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Manufacturing and trading

jayantpandey09 (Others) (24 Points)

24 September 2012

Hi , I need some help .

I have one trading unit in Delhi in which we do a bit of small manufacturing. Last year we did a total turn over of 3 Crores in which 20-30 Lakhs was in manufacturing. Now we are setting up a new plant in noida in which we are planning to do trading and manufacturing both. But we are sure that for the first finantial year our total turn over will not go beyond 5 crores in which 3.5-4 crore will be trading and <1 crore will be manufacturing. Yes our manufacturing products and trading products are different. We will not trade the product we manufacture.

I don't want to come under excise right now. So whether i can remain out of excise with above credentials.

Please advise the maximum limit as well.

Thanks

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2 Replies

U S Sharma (glidor@gmail.com) (21063 Points)
Replied 24 September 2012

using seperate place of business and godowns for trading goods is preferred,

as under excise, where the goods are manufactured, no duty paid goods are allowed to enter, which are not to be used in manufacturing, department may lead to conficsation of such goods if found within the area of manufacturing.

as excise is matter of manufacturing mainly, so its always better not to do trading with same establishment, however if the assessee want to do so, then its must not to use the manufacturing yard for trading purpose.

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DEEPAK ROHERA (Senior Accountant) (285 Points)
Replied 24 September 2012

Mr. Pandey,

There is single problem in your case that you can do trading and manufacturing in under the same floor, but can do one another thing that you made another firm on which you send you raw material for job work pupose and take back after that you can do trading of the same product as per this you doest be registered and trade your manufactured product