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Clarification on procedure

Joginder Singh Bhatia (PROPRIETOR) (37 Points)

31 October 2011

A want to start new small buisness as trader ( No manufacturing activity) in metal Scrap, Expected yearly turnover 50 lakhs

He is planning to purchase scrap from B (Manufacturer & having Excise registration) & C (manufacturer Not registered with Excise)

Now B will charge A - ED but C will not charge ED

A want to sell all material to D ( Big scrap dealer registered under Central Excise)

My Questions.

1.Whether A can get registration with Cetral Excise as turnover is small?

2.Can he take ED credit when purchases from B ?

3. Can he pass on full ED credit to D on sale or any part of ED ?

4. Whether ED to be Charged on Sale to D on scrap purchased from C without ED credit.?

5. Expected purchase are about 40 lakhs/annum from B and 10 lakhs/annum from C. Will it be worth registring with Excise.?

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4 Replies

Harsh Adhyaru (Sr.Officer) (38 Points)
Replied 31 October 2011

i want to file refund claim of duty paid of capital goods which are cleared after 10 year of the life and that time depriciation value become nil as per depriciation law, so how can i apply for refund on duty paid and in which format i have to file refund of duty paid on capital goods after NIL value in books of account and cleared as as such.

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Joginder Singh Bhatia (PROPRIETOR) (37 Points)
Replied 31 October 2011

This is not answer to my query. Request some expert to answer my query

U S Sharma (glidor@gmail.com) (21063 Points)
Replied 01 November 2011

Originally posted by : Joginder Singh Bhatia

A want to start new small buisness as trader ( No manufacturing activity) in metal Scrap, Expected yearly turnover 50 lakhs
He is planning to purchase scrap from B (Manufacturer & having Excise registration) & C (manufacturer Not registered with Excise)
Now B will charge A - ED but C will not charge ED
A want to sell all material to D ( Big scrap dealer registered under Central Excise)
My Questions.
1.Whether A can get registration with Cetral Excise as turnover is small?

- dealer registration is not dependent on turnover, from Rs 1/- dealer registration is valid.

2.Can he take ED credit when purchases from B ?

- A can not take input credit but can pass the ED charged by B to D by issue of excise dealer invoice and maintaining the records in RG23D.

3. Can he pass on full ED credit to D on sale or any part of ED ?

- A can pass on all duty paid by himself while selling to D, 100% duty transfer on 100% stock purchased from B.

4. Whether ED to be Charged on Sale to D on scrap purchased from C without ED credit.?

- No, dealer can not charge ED by self, he can pass on only the original duty charged by manufacturer to next buyer.

5. Expected purchase are about 40 lakhs/annum from B and 10 lakhs/annum from C. Will it be worth registring with Excise.?
- he can sell goods on commercial invoice for all goods, and can issue cenvatable excisable invoice for the quantity , he received with duty paying document. he can not issue cenvatable invoice for the goods which are not accompanied with duty paying documents.

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U S Sharma (glidor@gmail.com) (21063 Points)
Replied 01 November 2011

Originally posted by : Harsh Adhyaru
	i want to file refund claim of duty paid of capital goods which are cleared after 10 year of the life and that time depriciation value become nil as per depriciation law, so how can i apply for refund on duty paid and in which format i have to file refund of duty paid on capital goods after NIL value in books of account and cleared as as such.

You have to use the credit in clearance of taxable goods / services from your factory of production, no cash refunds possible except "claim of rebate against export"