exemption Benifit under notification 30/2004

[HIMANSHU JARIWALA]

Dear Sir,

Company XYZ Pvt. Ltd. Manufacturing Fully Drawn Yarn from chips which is excisable and further process FDY to produce Monofilament yarn which is also exisable because copany has facility to produce FDY as per Notification No. 30/2004-CE. Now If another firm purchase FDY from XYZ Pvt. Ltd. and produce Mono Filament Yarn then also excise is applicable to other firm on productuion of Monofilament Yarn? The Pvt. ltd. Company and firm has Common Directors as Partners.

AI Summary

Monofilament Yarn by Purchasing Firm Exempt from Excise Duty if No Cenvat Credit Claimed Under Notification No. 30/2004. Company XYZ Pvt. Ltd. manufactures Fully Drawn Yarn (FDY) and Monofilament Yarn, both excisable under Notification No. 30/2004-CE. A query was raised about whether another firm, purchasing FDY from XYZ and producing Monofilament Yarn, is subject to excise duty. The response clarified that under Notification No. 30/2004, exemption from excise duty applies if no Cenvat credit is claimed on inputs. Therefore, the purchasing firm is not liable for excise duty on Monofilament Yarn production, and the shared directors between the companies do not affect this exemption.