Modvat

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

22 November 2011 We are a manufacturing company sold goods to a trader who doesn't have excise registration and do not avail excise benefit.The said trader after 3 month returned the said material but we have already paid the excise duty for the said sale. Now I would like to know how or what shall be the procedure to return the material so that we can take the benefit of the excise already paid.Early response shall be highly solicited.

Is any body there to help me out.

Querist : Anonymous

Querist : Anonymous (Querist)

24 November 2011 Somebody help me. Please.

PUNEET GOYAL

PUNEET GOYAL (Expert)
Follow

24 November 2011 The above problem is dealt by Rule 16 of Central Excise Rules, 2002.

RULE 16. Credit of duty on goods brought to the factory. — (1) Where any goods on which duty had been paid at the time of removal thereof are brought to any factory for being re-made, refined, re-conditioned or for any other reason, the assessee shall state the particulars of such receipt in his records and shall be entitled to take CENVAT credit of the duty paid as if such goods are received as inputs under the CENVAT Credit Rules, 2002 and utilise this credit according to the said rules.

(2) If the process to which the goods are subjected before being removed does not amount to manufacture, the manufacturer shall pay an amount equal to the CENVAT credit taken under sub-rule (1) and in any other case the manufacturer shall pay duty on goods received under sub-rule (1) at the rate applicable on the date of removal and on the value determined under sub-section (2) of section 3 or section 4 or section 4A of the Act, as the case may be.
Explanation. - The amount paid under this sub-rule shall be allowed as CENVAT credit as if it was a duty paid by the manufacturer who removes the goods.

(3) If there is any difficulty in following the provisions of sub-rule (1) and sub-rule (2), the assessee may receive the goods for being re-made, refined, re-conditioned or for any other reason and may remove the goods subsequently subject to such conditions as may be specified by the Commissioner.

PROCEDURE:

1. U sud state the particular of such return in ur records.

2. Material sud be return by the customer under any letter or challan.

3. For taking cenvat credit u sud keep triplicate copy of invoice issued by u at the time of sale along with above challan or letter.

4. Maintain detail of process undertaken after receipt of material. Whether the said process is manufacturing or not.

5. At the time of removal of said goods pay an amount equal to cenvat credit taken or calculated on the value determined u/s 4/4A as the case may be.

If u r satisfied by my reply then say thanks by clicking on "THANK USER".

Upgrade to CAclubindia Pro. Subscribe Now!