Proceduire for Job Work on material supplied by registered dealer

[SRIVATSAN RAJAN]

I am a registered dealer under Central Excise. I import Steel Coils in my name. I supply the same to my Job Worker free of cost. Job Worker converts the same into pipes and the pipes are despatched from the Job Worker's factory to my customers. I want to follow the below mentioned procedure:

1. I will raise an Excise Invoice (Stock Transfer) Invoice showing the name and factory address of my Job Worker;

2.The Job Worker will take CENVAT Credit in their RG 23A; convert the raw materials into pipes and raise an Excise Invoice on me, for the full value of the tubes and charging excise duty on full value and debiting his RG 23A;

3. I will raise my invoice on my customers and despatch the goods;

4. There is no need to follow Notification 214/86 which applies only to manufacturers

5. CESTAT Chennai Bench has held in Mahadev Industries Vs Commissioner of Central Excise that the ownership is not required to avail the CENVAT Credit; so long as their name and factory adreess are shown in the CENVAT availing documents.

6. please confirm that the above mentioned procedure is in order

AI Summary

Dealer Seeks Confirmation on Excise Duty Process for Steel Coil Conversion; Questions Notification 214/86 Applicability A registered dealer under Central Excise imports steel coils and supplies them to a job worker free of cost. The job worker converts the coils into pipes, which are then dispatched to the dealer's customers. The dealer proposes to raise an Excise Invoice to the job worker, who will take CENVAT Credit, convert the materials, and raise an Excise Invoice back to the dealer. The dealer will then invoice the customers. The dealer seeks confirmation that Notification 214/86 is not applicable and cites a CESTAT ruling supporting their procedure. A respondent queries the payment of excise duty on the conversion process.