Job-Work for Unit situated in Excise exempted Zone

[Guest]

We are manufacturing Brass sheets & strips (Excisable Item). We wish to know if Job-work of brass scrap, generated from excise paid finished Brass strips, can be converted to finished form without paying of excise duty if the buying unit is situated in excise exempted state such as Uttaranchal etc.

[Alok Kumar]

Dear Mr. Parivesh Goel,

The goods which have been covered under the relevant central excise AREA BASED exemption notification does not mention the the goods / activity being presently manufactured by you or the goods on which you intend to get the job work done in the state of Uttarakahand.

Considering the same you will not get any exemption from duty of Central Excise on the said goods/ activity.(had these been brass handicrafts goods you could  get the exemption).

Alok Kumar

Advocate

[Mahaganapathi V]

Sir

There are specific exemtions to SEZ, EOUs etc and any sale to such units which are located under these areas are not liable to pay Excise duty, Sales Tax or Service Tax. These exemptions are available to those units under the act itself.

In your case you are not exempted from excise duty. However you can claim refund or adjust the cenvat with other taxable sales made to other category of purchasers.

Mahaganapathi.V

AI Summary

Excise exemption for area-based zones does not extend to job-work on excisable brass scrap without specific notification. Area-based excise exemptions apply only to goods and activities expressly covered by the relevant notification; job-work on brass scrap from excise-paid finished brass strips is not exempt merely because the buyer is located in an exempted zone. Specific exemptions for regimes like SEZs and EOUs exist, but absent coverage the supplier remains liable for central excise and may instead seek refund or adjust CENVAT credit as permitted by law.