INTER UNIT SALE / STOCK TRANSFER

[SANJEEV JADHAV]

Recently we will start our second unit near to our existing factory. We are manufacting panels from our Unit I. Fabrication required for manufacture of panels will be get from our new Unit i.e. Form Unit II. We have taken excise registration for both units seperately. Old unit is as Unit I and new unit as Unit II. We required information for below points : 1. Can we send material i.e Plates from Unit I to Unit II for job work and get process the same from Unit II. 2. What precautions we have to consider while making job work ? 3. If we decide to take option to sale goods from Unit II to Unit I instead of job work, then what formalities we have to complete for the same to Excise. 4. If we decide to go with sale, then what will be the Sales tax for the same. Please clarify above points.

[YAGAY and SUN]

You would have to comply with the Rule 8 and Rule 9 of the C.E. Valuation Rules if you want to sell it to your other unit.

In case of Jobwork, service tax would be applicable, if not amounting to manufacturing or on final goods duty is not being paid.

AI Summary

Inter-unit sale compliance requires adherence to central excise valuation rules; jobwork arrangements may attract service tax liability. For inter-unit sale of goods between separately excise-registered units, compliance with Rule 8 and Rule 9 of the Central Excise Valuation Rules is required to determine assessable value. Where processing is structured as jobwork, the transaction may attract service tax unless the operations amount to manufacture or duty on the final goods is otherwise discharged.