We have to pay excise for supply of non excisable items?

This query is : Resolved

sekhar (Querist)
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26 February 2010 We were executing the works contracts. We were the manufacturers of steel structures for industrial and commercial godowns. In this part we were purchasing the M.s.plates, sheets, m.s.strips, I.S.M.B, M.S.Angles, Squares, Rounds with Excise from manufacturers and also without excise from traders and also purchasing non excisable products like lighting sheets, turbo ventilators and self drilling screws . I had little doubt regarding the supply. We are doing one work in this work it includes all the above excisable rawmaterials (structures)for constructing the shed and also we were sending the non excisable goods like lighting sheets for fixing of lights and self drilling screws for fixing of sheets and turbo ventilators for cooling solutions. We were paying excise duty on raw materials (Structures)Now i had doubt regarding non excisable suply of lighting sheets, screws & turbo ventilators, whether we have to pay excise for that non excise items or not? we were fixing the above non excise items on our structures. so we have to pay excise duty on the non excisable purchases also? or not? please give me solution.

Thanking you

Raja

M Prabhakar Menon

M Prabhakar Menon (Expert)
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26 February 2010 The concept of works contract tax is wrt Sales Tax/VAT law there is no such provision under excise regulations.There is a provision in the central excise law for "Job Works" and use of Form 57F and related records keeping and accounting.Excise duty is charged on goods manufactured including deemed manufacture on the final output/product.Where non excise paid goods are used u cannot claim cenvat benefit on those items.