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Waste Generated during Job work u/r 57 f(3)

Rajeev Nair (Finance Professional) (510 Points)

28 December 2008

Waste generated during job work by an excisable manufacturer for another company registered under excise is liable to be dispossed paying liable excise duty or not ?

Second thing the material processed and sent for job work is not an excisable commodity it is earth mineral and completely exempted under excise -

Ration is 100 Kg send for Processing

Returned 58 Kg - rest - 42 Kg is waste [ It is not returned back and not quantifiable - the waste is thrown out with water after process by job worker ]

Please clarify -

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1 Replies

Rajesh Kumar (Advocate- Tax) (7806 Points)
Replied 30 December 2008

As a general rule waste & scrap generated during job work is excisable and appropriate excise duty should be paid.

If however, the waste or scrap generated is not metioned in CETA, or if mentioned in CETA attracts nil rate of duty; such waste and scrap may not be dutiable.

The waste mentioned by you has not been generated, in fact it is lost. Further, it is not sold as the waste generated in not marketable- in such situation, such waste is not dutiable.