Return of Watage by Job Worker to Principal Manufacturer

[Asked by Guest]

ours is packaging unit and also undertakes job work-converting paper & board in to Packaging Cartons.

Facts -Proncipal Manufacturere supllies Paper Board to Be converted in Cartons -Finished Products

          In Invoice of job work charges weight of Inputs contained in finished product and Wastage of Input is reported.So total quantity control in the invoices and also in  sub Chalans and finally in Main Job Work chalan is mentioned.

Input wastage is not physically returned to principal manufacturer but we  -job worker -remove along with our wastage on payment of Duty.But the principal manufacturer has apprhension that excis authorities would raise on demand on them.

What is correct procedure?

AI Summary

Waste removal on payment of duty: job worker need not return wastage if duty paid and documentary proof maintained.
Job workers need not return wastage to the principal manufacturer provided the wastage is removed on payment of excise duty and documentary proof of payment is maintained. It is advisable to pay duty for such wastage separately each month via a TR-6 challan and send copies with a detailed worksheet to the principal manufacturer. Parties should clarify whether duty on wastage is included in job-work charges or charged separately.