Procedure U\R 4(6) of CCR-2004

[sukhvinder singh]

Dear all,

Please confirm me the procedure as permision provided under sub rule 6 of rule 4 of  Cenvat Credit Rule, 2004 under central excise 

Also clear what about the state sale tax and central sale tax formalities    

Thanks

[YAGAY and SUN]

Cenvat CreditRule 4 (6):-  The Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, having jurisdiction over the factory of the manufacturer of the final products who has sent the input or partially processed inputs outside his factory to a job-worker may, by an order, which shall be valid for a financial year, in respect of removal of such input or partially processed input, and subject to such conditions as he may impose in the interest of revenue including the manner in which duty, if leviable, is to be paid, allow final products to be cleared from the premises of the job-worker.

This above Rule Should be read with RULE 10A. CENTRAL EXCISE VALUATION  (DETERMINATION OF PRICE OF EXCISABLE GOODS) RULES, 2000 Where the excisable goods are produced or manufactured by a job-worker, on behalf of a person (hereinafter referred to as principal manufacturer), then, -

(i)	in a case where the goods are sold by the principal manufacturer for delivery at the time of removal of goods from the factory of job-worker, where the principal manufacturer and the buyer of the goods are not related and the price is the sole consideration for the sale, the value of the excisable goods shall be the transaction value of the said goods sold by the principal manufacturer;
(ii)	in a case where the goods are not sold by the principal manufacturer at the time of removal of goods from the factory of the job-worker, but are transferred to some other place from where the said goods are to be sold after their clearance from the factory of job-worker and where the principal manufacturer and buyer of the goods are not related and the price is the sole consideration for the sale, the value of the excisable goods shall be the normal transaction value of such goods sold from such other place at or about the same time and, where such goods are not sold at or about the same time, at the time nearest to the time of removal of said goods from the factory of job-worker;
(iii)	in a case not covered under clause (i) or (ii), the provisions of foregoing rules, wherever applicable, shall mutatis mutandis apply for determination of the value of the excisable goods :

Provided that the cost of transportation, if any, from the premises, wherefrom the goods are sold, to the place of delivery shall not be included in the value of excisable goods.
Explanation. - For the purposes of this rule, job-worker means a person engaged in the manufacture or production of goods on behalf of a principal manufacturer, from any inputs or goods supplied by the said principal manufacturer or by any other person authorised by him.

Furthe, you would have to obtain permission from the concerned authority regarding Rule 4(6) of the Cenvat Credit Rule.

While issuing invoice from the place of jobworker, applicable rate of VAT/CST as applicable will be charged by you in your invoices.

AI Summary

Cenvat credit permission allows clearance of final products from job-worker premises subject to valuation and compliance conditions. Permission by the Deputy or Assistant Commissioner may allow removal and clearance of inputs or final products from a job-worker's premises for a financial year subject to revenue-protective conditions including duty payment procedures. Valuation rules treat goods manufactured by a job-worker for a principal: transaction value applies where the principal sells at removal to an unrelated buyer; where goods are moved for later sale, normal transaction value at or about the same time governs; other valuation provisions apply mutatis mutandis. Transport cost from place of sale to delivery is excluded. Job-worker is defined as one manufacturing on behalf of a principal. VAT/CST must be charged on invoices issued from the job-worker's place.