Material not recieved within 180 days
This query is : Resolved
29 December 2015
if company sent material on job work and it does not recieved within 180days then we have to debit the party by the amount of excise duty of which we had taken credit. if we does not debit the party, then is their implication of interest? if yes, what will be the procedure to calculate it?
29 December 2015
Provisions related to Removal of goods for Job Work
Removal for processing/test- The inputs/capital goods can be removed as such or after partial processing to job worker for further processing, testing, repairs, reconditioning, or for manufacture of intermediate goods necessary for manufacture of final products or any other purpose without any duty payment.
Goods should be returned to factory/premises of service provider- After carrying out the operation/test/repair etc., the goods should be returned to the factory or premises of supplier within 180 days. If these are not received back within 180 days of their being sent out, manufacturer/ service provider should pay an ‘amount’ equivalent to Cenvat credit attributable to inputs/ capital goods. Payment can be through Cenvat credit or P LA. If the inputs/ capital goods come back after 180 days , then manufacturer/service provider can again take Cenvat credit of duty reversed by him.
If part of goods is received back 180 days, the obligation for debiting the credit shall arise only in respect of Cenvat credit attributable to that part which is not received within 180days.
No Reversal even if capital goods not returned within 180 days- Incase of Capital goods sent to job workers even if they are not returned by job worker within 180 days , Cenvat Credit is not required to be reversed .
Moulds and dies, jigs and fixtures are not required in 180 days- The requirement that the
capital goods/ input must come back within 180 days is not applicable to moulds and dies.
Removal for processing/test- The inputs/capital goods can be removed as such or after partial processing to job worker for further processing, testing, repairs, reconditioning, or for manufacture of intermediate goods necessary for manufacture of final products or any other purpose without any duty payment.
Goods should be returned to factory/premises of service provider- After carrying out the operation/test/repair etc., the goods should be returned to the factory or premises of supplier within 180 days. If these are not received back within 180 days of their being sent out, manufacturer/ service provider should pay an ‘amount’ equivalent to Cenvat credit attributable to inputs/ capital goods. Payment can be through Cenvat credit or P LA. If the inputs/ capital goods come back after 180 days , then manufacturer/service provider can again take Cenvat credit of duty reversed by him.
If part of goods is received back 180 days, the obligation for debiting the credit shall arise only in respect of Cenvat credit attributable to that part which is not received within 180days.
No Reversal even if capital goods not returned within 180 days- Incase of Capital goods sent to job workers even if they are not returned by job worker within 180 days , Cenvat Credit is not required to be reversed .
Moulds and dies, jigs and fixtures are not required in 180 days- The requirement that the
capital goods/ input must come back within 180 days is not applicable to moulds and dies.
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30 December 2015
yes sir, but if i don't reversed credit taken by me if material not come within 180 day then is there any implication of interest ?
30 December 2015
Interest is payable under Section 11 AA. The rate of interest is 18% per annum vide Notification No. 5/2011-CE (N.T) dated 1.3.2011.
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