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Depot transfer

Jeevesh Mehta (Advocate- Corporate Commercial & Indirect Tax Advisory) (861 Points)

19 July 2010

Dear All, Kindly read as belo: Manufacturrer A in noida wants to open a sales office in Haryana. At the time of clearing the goods from factory at noida to sales office at Haryana... what would be the implications under excise... can this transfer be done without payment of duty? Or it has to be duty paid transfer under provisional asessment? Please advise... Regards

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3 Replies

Kapil (ds) (92 Points)
Replied 19 July 2010

Hi Jeevesh...

Depot transfer can very well be made by the said firm but only after applicable duty payable on Normal Transaction Value defined under rule 2(b) of C. E. Valuation Rules, 2000. At the subsequent sale from depot, the assessee will not be liable to pay excise duty and the Buyer can take CC of the duty so paid.

Hope that above xplanation helps u..

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Jeevesh Mehta (Advocate- Corporate Commercial & Indirect Tax Advisory) (861 Points)
Replied 20 July 2010

Thanks Kapil...

Prabhat Kumar (Advocate & Consultant) (1912 Points)
Replied 20 July 2010

No, goods can not transferred without payment of excise duty. when the goods transferred to the depot, the value should be normal transaction value of such goods at the depot at a particular time. It means the value for the purpose of the excise will be the value of the goods at a particular date at the depot and at this price excise duty is to be paid at the time of clearance of the goods from the factory.