LEVY OF EXCISE DUTY AND COMPLIANCE

[S.C. WADHWA]

We are manufacturers of food products falling under chapters 7,20 and 21.                                                                                         

items falling chapter 7 are of nil rate of duty.                                                                                                                       

we are paying duty on items falling under chapters 20 and 21 @2.06% and not availing cenvat on input.                                  

Now we want to trade in one item manufactured by a unit of the same group falling under chapter 19041090.                                     

They are paying duty @ 6% and availing cenvat on input. If they sold said item in loose then there is nil rate of duty.                         

We want to purchase the said product at nil rate of duty but being a food product in how much bulk packing the said                       

material be purchased so that the same may be treated as loose packing ( simply used plastic bags without any brand name.)

we will pack the material according to our requirement and fix MRP accordingly and pay duty @2% after getting abatement on MRP.

Please also advise whether it involves any compliance with excise authorities i.e. whether we are required                                          

to inform excise authorities.                                                                                                                                                       

 

AI Summary

Unit container classification determines excise rate; goods in unit containers attract standard duty while loose bulk may be nil.
Whether goods under sub heading 19041090 attract nil duty or the tariff rate depends on whether they are "put up in unit containers"; unit container clearances fall under the Third Schedule and are valued under Section 4A using MRP rules with abatement where applicable, and may permit CENVAT for the supplier. The term "bulk" is not defined and unit container status is a factual determination affecting duty liability and SSI exemption applicability under turnover aggregation rules.