9911796707
TMI BlogModvat Credit on Textile FabricsX X X X Extracts X X X X X X X X Extracts X X X X ..... as follows: (i) The cutoff point for the confessional rates of AED (ST) and BED, both at 5% applicable to 100% cotton fabrics has been increased to Rs. 30/sqm. (ii) The rate of BED in respect of other fabrics has been increased from 10% to 12% but that of AED reduced from 10% to 8%. (iii) "Composite mills" will function under conventional Modvat Scheme, except for fabrics processed on job-basis. 4. The implications in respect of composite mill as well as independent processor are discussed below:- COMPOSITE MILL (i) The definition of a composite mill has been modified so as to include only such composite mills who are engaged in the processes of spinning of yarn from fibres (mills engaged in drawing of filament varns alongwith weav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed after processing. It may be noted that for fabrics processed by a composite mill on job-basis, the deemed credit would be at the rate of 40% or 60%. (viii) In case of a composite mill, the credit of duty pad on inputs lying in stock on the transitional day will be available as per the provision of the rule 57H. This credit has been provided for on all inputs including yarn lying in stock as such or contained in grey fabrics lying in stock or contained in processed fabrics lying in stock or are used in the manufacture of processed fabrics which are cleared on or after 4th September, 1996. In respect of such stocks of grey fabrics and processed fabrics received on job work, provision has also been made to allow credit on the deemed basis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eased from 50% to 70% which is in lieu of duty paid on inputs by such processors except that on capital goods. In other words independent processors will get credit of duty paid on capital goods on actual basis. For all other inputs no actual credit will be permitted. In the case of cotton fabrics in deemed credit at 50% is also inclusive of duty paid on dyes, chemicals etc. Rate structure for Independent processor as well as multi locational mills BED Deemed Credit as a% of BED AED 1. 100% cotton fabric upto a value of Rs. 30/sqm. 5% 50% 5% 2. 100% cotton fabric of value exceeding Rs. 30/sqm. 12% 50% 8% 3. All other fabrics 12% 70% 8% 4.5 Deemed credit is in lieu of duty paid on fibres, yarns, dyes, chemi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of capital goods where the credit of actual duty paid will be available under sub rule (1) of rule 57A. 5.3 The reduction in BED rates from 20% to 10% in respect of various fabrics as proposed in the Finance Bill, 1996 has not yet become effective. The increased rate of BED as well as reduction in AED rates have been prescribed by amending notification Nos. 8/96-CE, 9/96-CE, 16/96-CE and 17/96-CE suitably. Necessary amendment will be carried out in the Finance Bill through official amendment. 5.4 The restriction of exemption for minor processes to only such units as do not have the facility of bleaching, dyeing or printing continues. In case a processor having facilities for bleaching, dyeing or printing also undertakes the minor process ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
