transfer of finished goods on de-merger.

[PRANAB PANDA]

Dear Experts

Our unit is an integrated Stainless Steel Plant and the existing Coke Oven i.e. Coke manufacturing facility will be transferred to new unit formed as per the scheme of de-merger.

Presently we are maintaining Daily Stock Register for all the products i.e. Stainless Steel products and also the Coke which is manufactured in Coke Oven Plant.

After de-merger, the Coke Oven facility will be transferred to separate legal entity and we will take separate Excise Registration for that entity.

In this context my specific query is the modality of transferring the closing stock of Coke finished goods / coal tar from the Daily Stock Register of our unit to newly formed entity.

[KASTURI SETHI]

Before transferring/shifting all types of stock intimate the jurisdictional Range Officer. Get dated signature of Inspector of Range. In the letter give all the details regarding de-merger etc. Stock is to be transferred on regular invoice book maintained by you at present. Write the words, "Stock transfer" to ---------name of new unit. Give reference of letter written to Range. Since you are to remove excisable goods, the same are to be removed on routine invoice under Rule 11 of CE Rules. All documents regarding shifting must be kept as records in both units.

[PRANAB PANDA]

Thanks for the valued advice and my specific query is that can the newly formed unit be able to avail cenvat credit on the basis of stock transfer as per invoice issued under rule 11 of Central Excise Rule,2002.

Thanks

Pranab Kumar Panda

[KASTURI SETHI]

Yes, undoubtedly. You will have to quantify and intimate the jurisdictional Assistant Commissioner, in charge of Division Office as well as Range Officer. You are to work out the exact amount of cenvat credit you are entitled to. And certify the same and the department may check the exact admissible amount.

AI Summary

Cenvat credit on stock transfer allowed when excisable goods are moved under prescribed excise rules following departmental intimation. Transfer of excisable finished goods on de merger must be preceded by intimation to and dated acknowledgment from the jurisdictional Range Officer, effected on the regular invoice book with the words 'stock transfer' and a reference to the de merger communication, and all shifting documents retained by both units. The transferee may claim Cenvat credit based on that stock transfer invoice after quantification, certification and intimation to the Assistant Commissioner and Range Officer, subject to departmental verification.