Levy of excise

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

19 March 2013 Friends:

In case of lubricants. MR.A who is owner of a brand name Suppose IDT. Now He give this brand name to Mr. B and Mr. C on royalty basis to use it for manufacturing of lubricant oil with a condition that the final product only to be sold to him.Turnover of Mr. B & Mr. C is Rs. 145 Lacs each.

Now my question is that is Mr. A, Mr. B and Mr. C are require to get their registration under excise law.

Please explain as soon as possible.

Regards:
CA Sandeep K Agrawal
Email: sacaj7@gmail.com

Rajeev Kumar Garg

Rajeev Kumar Garg (Expert)
Follow

19 March 2013 Dear Agarwal Ji,
Yes, Mr. B and Mr. c are required to get their registration as per excise rules.
Value based S.S.I. Exemption under notification no. 8/2003-CE dtd. 01.03.03 is not permissible in the case of manufacturing under other name & brand. Therefore, excise duty is applicable from 1st day of the year.
Amount against royalty paid to "A" by "B" & "C" is related to servise tax under the category of "Intellectual property service", therefore, "A" is required to get registration in service tax who will charge service tax from "B" & "C" on their bill and pay to department.
Thanks.
RAJEEV KR. GARG
(Consultant, Custom, Excise & Service Tax)
If you are satisfy with reply, pl. click on "Thank user".
Thanks.

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

20 March 2013 Dear RKG,

Thank you.

Is there any excise liability on Mr. A? If not than please give the ref. of rules or any case law. which may me present in before of excise department in case of any discrepency,

Regards
Ca Sandeep K Agrawal

Upgrade to CAclubindia Pro. Subscribe Now!