Central excise on branded garments.

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

03 September 2011 KIND ATTN.SIR
==============
A FIRM IS A MANUFACTURER OF BOTH EXPORT AND DOMESTIC READYMADE GARMENTS.THE FIRM MANUFACTURES THE GOODS IN THE SISTERN CONCERN NAME'S BRAND AND SELL THE BRANDED READY GARMENTS TO THE SISTER CONCERN.
AT THIS JUNCTURE I WISH TO GET CLARIFICATIONS:
1. IF THE MRP VALUE IS DISCLOSED TO THE MANUFACTURER BY THE SISTER CONCERN, THE DUTY IS LEVIED @45% ON MRP AND DUTY RATE IS 10%
2. IF THE MRP VALUE IS NOT DISCLOSED TO THE MANUFACTURER BY THE SISTER CONCERN AND THE DUTY IS LEVIED ON TRANSACTION VALUE OF THE MANUFACTURER @10%.
IN THIS CASE , THE SISTER CONCERN THE PURCHASES THE GOODS AND MARKETS THE GOODS AT MRP. WHETHER THE SISTER CONCERN HAS TO LEVY THE DUTY 10% FOR THE GOODS VALUE @45% ON MRP.WHETHER THE SISTER CONCERN CAN ALSO CLAIM INPUT CREDIT FOR THE DUTY PAID FOR THE PURCHASES MADE FROM THE MANUFACTURER . KINDLY CLARIFY.
WITH REGARDS
CA.P.SHANGAR

U S Sharma

U S Sharma (Expert)
Follow

06 September 2011 1)sister concern is not a manufacturer in this case, so the sister concern does not have any relation to charge excise or avail cenvat credit.

2) as said, sales through sister concern ( related party) the sale value adopted by sister concern would be the assessable value for manufacturer.

3) branded goods rates will follow for manufacturer, and manufacturer will not be in position to avail SSI benefits.

Querist : Anonymous

Querist : Anonymous (Querist)

06 September 2011 KIND ATTN. SIR
KINDLY CLARIFY IF THE MRP VALUE IS NOT DISCLOSED TO THE MANUFACTURER BY THE MARKETING CONCERN.

WITH REGARDS
CA.P.SHANGAR

Upgrade to CAclubindia Pro. Subscribe Now!