Master TDS & TCS Provisions with Critical Issues. Register Now!

Purchases by a SEZ Unit

Anuj Tyagi (A.M.-Purchase) (24 Points)

20 February 2009

How can EXCISE BENEFIT be claimed in case of excise registered supplier raise Invoice from outside non-SEZ area to a Unit in SEZ area. [As per my understanding : the supplier in such a case can’t avoid the Excise Duty charging in the Invoice as he is registered in Excise & SEZ Unit can’t claim the CENVAT. Ultimately , the cost will increase by 10.32% in Input material as supplier shall intend to claim the rebate for what he has paid while pruchasing the raw material from his supplier].

Reply
Follow
Share

4 Replies

Sachin (Chartered Accountant) (419 Points)
Replied 20 February 2009

Dear Anuj,

As Per Rule 5 of the Cenvat Credit Rules, 2004 You can claim the refund but there are certian definite procedure of it. please write me in my email id sachinagarwalcallb @ gmail.com with full details.

Upgrade to CAclubindia Pro. Subscribe Now!

Rajesh Kumar (Advocate- Tax) (7806 Points)
Replied 20 February 2009

Supply to SEZ is physical export, hence no need tp send material on payment of duty. Material can be sent on ARE-1, under bond. Alternatively, duty can be paid on ARE-1 and the duty paid can be claimed as rebate. Further alternatively, refund can also be taken under Rule 5 of the Cenvat Credit Rules, as suggested by Sachin.

Further, for supply to SEZ all other export benefits like advance authorisation, DEPB, Drawback, EPCG etc. is available.

Girish (Dy.Manager) (35 Points)
Replied 18 February 2011

Is it possible to a excise registered trader to issue the ARE-1 against delivery to SEZ unit for sales duty free material.

Further if a DTA trader ( excise registered ) sales material on excise challan to SEZ unit and charging the excise duty. is it possible that the SEZ unit can claim refund of such excise duty paid on that material.

Pls. guide me at my id also girishrawal2004 @ gmail.com. Txs n regards

U S Sharma (glidor@gmail.com) (21063 Points)
Replied 18 February 2011

Originally posted by : Girish

Is it possible to a excise registered trader to issue the ARE-1 against delivery to SEZ unit for sales duty free material.

-ARE-1 is for manufacturer part , not to be used by traders.

Further if a DTA trader ( excise registered ) sales material on excise challan to SEZ unit and charging the excise duty. is it possible that the SEZ unit can claim refund of such excise duty paid on that material.

-in such case the trader has to send the ARE1of SEZ to manufacturer and obtain goods under ARE1 and bond from principal, and deliver the same to SEZ, here the bond/CT-1/ARE1 all will carry the name of manufacturer only..

Pls. guide me at my id also girishrawal2004 @ gmail.com. Txs n regards