29 November 2013
There is a publishing house which publishes spiritual books and DVDs.
Books are printed from various printers.The publishing house gives the content. Two mode of printing was used. 1. Publisher supply paper and printer prints the book. 2. Printer uses his own paper and print the book.
Dvds are replicated with vendors who charge excise duty with abatement which we pay the vendors.
Now, the observation is as follows:
Being a manufacturer of excisable goods which are chargeable to nil rate of excise duty or are falling under head where rate is Blank. Further, as per Rule 9(2) (i), persons who manufacturer excisable goods which are chargeable to nil rate of excise duty are fully exempted from the duty by a notification subject to the declaration to be made in specified Form.
Hence, the publisher was asked to register under excise or submit the declaration form.
Now the point of contention is as follows:
The point of taxation arises only on the account of manufacture. As per Excise Act, the job-worker (printer) is the manufacturer under both the circumstances. Deemed manufacturer is not arising as price is the sole-consideration for awarding the order and there is no principal to principal basis.
Hence, the publisher is not a manufacturer and hence need not register under excise or file a declaration to such effect.
01 December 2013
Your observation is correct, the liability of Paying Excise Duty is on the actual manufacturer i.e. JOB WORKER and the same is always liveable on TRANSACTION COST by the manufacturer (including cost of Raw Material).
As you said your product is exempted from the Excise Duty, it is not payable. However, as a probationary measure you can always ask your JOB WORKER to furnish, his EXCISE REGISTRATION NUMBER and a under taking from him that EXCISE DUTY is not payable and being exempted vide Tariff Entry No. ___ as well Notification No. ___ and also as a manufacturer it will be his sole liability to pay Excise Duty if it arise.
CAclubindia
