JOB WORK under Notification 214/86

[SRIVATSAN RAJAN]

My client holds a "Manufacturer" registration under Central Excise for Adhesives and Sealants. They want to buy/ import steel coils and get them converted into steel tubes on job work basis. Can they avail the benefit of Notification 214/86 , even though they do not have the "manufacturer" registration for "steel tubes", since the Notification uses only the word "manufacturer"

[Alok Kumar]

Dear Sir,

As the notification nimber 214/86, c.e is applicable only for the excisable goods which are subject to levy of central excise duty , you  can avail this exemption notification when the new product / goods are covered under central excise/ or included in the central excise registration cerificate.

it is important to mention here that once a manufacturer pays duty on its exisiting excisable goods he cannot claim exemption on his new manufatured goods.

we should also examine wherher such activity amounts to manufacture or not before deciding the duty liability on the said new goods.

alok kumar

[R K Rajwanshi]

1.  If your clinet buying f steel coil  for converstion into steel tube they can not avail exemption under 214/86, because process on purchased good can not be treated  as job work. 

2. If  steel coil received on behalf of any other manufacurer  than  your clinet may availe exemption  under notification 214/86  in case duty to be paid by final manufactuer other wise your client may be treat as deemed manufacturer and they will  pay excise duty on steel tube just because process which may be undertaken is subject to manufacture.

 

R K Rajwanshi

 

[YAGAY andSUN]

In our opinion you should opt Rule 10B of the Valuation Rules.