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Excise SSI Exemption Issue

CA. Saurabh Mishra (Practice) (104 Points)

16 June 2011

HI Friend ,

Kindly suggest me the issue related to SSI exemption with appropriate suportive evidence that is if two seperare corporate entity with same shareholder can claim the SSI exemption ( Rs.150 Lakh ).

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5 Replies

U S Sharma (glidor@gmail.com) (21063 Points)
Replied 16 June 2011

each pan holder ( individual/ firm/company) has been entitled to get its share of exemption,

be careful not to use common plateform or cross trading between both the entities, otherwise it will be taken as evasion under valuation act.

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CS Nadeem Ahmed Siddique (Company Secretary) (354 Points)
Replied 17 June 2011

If the total turnover for each individual firm is less than 4 crore it can avail the exemption of 1.50 crore without availing cenvat credit. However if the two firms are inter-connected the turnover of both the firms will be clubbed to determine the exemption limit.

There was a landmark case of Bata India Ltd. in this regard.

dhiraj (Logistics coordinator) (56 Points)
Replied 15 July 2011

Hi, We are just starting our operations in india as SSI unit. Now we have applied & registered for SSI unit,Excise ,VAT & CST registration. Now we are going to import all our inputs from UK and after assembling on it the Final goods wil be Exported to UK Back.(we are paying all the customs duties for both import & Export)

My question is

1) Do we need to take Refund of the duty paid on Imports separetely for Customs & excise duties.

2) Can we take credit of the paid import duties while making export with payment of duty.

3) As SSI unit what are the benifits are applicabe to us in case of Import & exports. ?

4) As for SSI units after turnover of 4CR for domestic sale they are applicable for ED in Excise .. Is it also applicable in our case of Exports only

U S Sharma (glidor@gmail.com) (21063 Points)
Replied 15 July 2011

Originally posted by : dhiraj

- you can perform the process under bond

2) Can we take credit of the paid import duties while making export with payment of duty.

- only cvd + EC is cenvatable, balance are not

3) As SSI unit what are the benifits are applicabe to us in case of Import & exports. ?

- under imprt and export, SSI unit has no special benefit

4) As for SSI units after turnover of 4CR for domestic sale they are applicable for ED in Excise .. Is it also applicable in our case of Exports only

- each unit is required to pay duty from 1st clearance, however to promote SSI sector, excise is charged on SSI manufacture, after 150 lacs, and the manufacturing unit loose its SSI status after 400 LACS. i e once reached to 400 lacs, the unit will loose its SSI facility and can not claim 150 lacs exemption in forthcoming year(s)

When you are going to be indian counter part of UK based parent company, you may need FEMA/RBI/DGFT clearance 1st.

1 Like

dhiraj (Logistics coordinator) (56 Points)
Replied 18 July 2011

Thanks a lot Sir, Now the inputs we are importing are going to attract basic custom duties as per below 34 % of the material - 0% BCD 61 % of the material - 10% BCD 5 % of the material - 8 % BCD Now after loosing the SSI exemption which shceme shall be suited for the import of the above said materials..

Regards

Dhiraj