related notification/law

[kamal chordia]

We are selling Textrusing Machines which we purchased second hand  without payment of excise dutty, Threfore please confirm that while selling the same today are we charged excise duty in the invocie or not.

if any notification /law , please confirm

Further what description  we mentioned in the invoice while selling the above second hand goods.

[YAGAY andSUN]

Since you have not paid any excise duty on the purchase of second hand machinery and obiviously you must haven't availed the CENVAT credit, further, while selling this second hand machinery you would not have done any work which tentamount to manufacturing, therefore, no Central Excise Duty will be paid.

While issuing invoice reference of the purchase invoice must be mentioned on the face of the sale invoice for one to one correlation.

[kamal chordia]

we are also for the same opinion but where in excise law it mentioned that procurement of second hand machine without excise duty would be cleared without payment of excise duty at the time of  sale 

 

 

[YAGAY andSUN]

The Liability of Excise duty is on manufactured goods and for convenient purpose it is collected on the removal of manufactured goods.  If the goods are not being manufactured then no excise duty will be paid on such goods. Further, documentory evidence will play crusial role that no excise duty was levied on second hand goods and no CENVAT credit was availed.

The two tests (i.e. Manufactured and Marketability ) determines the exigibility of excise duty on any goods. It is further clarified that no where in the Central Excise Laws, have been mentioned that procurement of second hand machine without excise duty would be cleared without payment of excise duty at the time of  sale.  It will be decided on the material facts. 

 

[rajkumar shukla]

very well explained.

 

AI Summary

Excise liability on resale: second hand machinery typically not dutiable if not manufactured and no CENVAT credit availed. Excise liability for resale of second hand machinery depends on whether the goods were manufactured and fit for marketability; if no manufacture occurred and no CENVAT credit was availed, resale will not automatically attract excise. Sellers must retain and reference original purchase invoices to demonstrate one to one correlation and establish that no excise was paid or credit claimed. There is no specific statutory exemption for resale of second hand machines purchased without excise; exigibility is decided on material facts and documentary evidence.