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Excise duty liability on empty bags,corrugated boxes & wooden scrap.

Central Excise - Started By: - Swapneswar muduli - Dated:- 7-2-2016 Last Replied Date:- 10-11-2016 - Dear Sir,If we removed the scrap items like empty poly bags, empty corrugated box, wooden pallet scrap from our factory.In the above case excise duty liability will attract or not ? As these scraps are not our process scrap.RegardsSwapneswar Muduli. - Reply By YAGAY AND SUN - The Reply = Settled legal position say no payment of excise duty is required on such goods. But as per the amended provisi .....

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in rule 6, in sub-rule (1), after the proviso, the following Explanations shall be inserted, namely: - Explanation 1. - For the purposes of this rule, exempted goods or final products as defined in clauses (d) and (h) of rule 2 shall include non-excisable goods cleared for a consideration from the factory. Explanation 2. - Value of non-excisable goods for the purposes of this rule, shall be the invoice value and where such invoice value is not available, such value shall be determined by using .....

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in terms of Board s Circular No. 721/37/2003-CX., dated 6-6-2003 based on the judgement of Supreme Court in the case of M/s. West Coast Industrial Gases Ltd. Vs.CCE. Reversal of credit is also not warranted. But these are not non-excisable goods as you have mentioned. On the basis that non-excisable goods are included in the definition of Exempted Goods , you have arrived at the conclusion that an amount of 6% is to be paid under Rule 6(3) of Cenvat Credit Rules, 2004, this is not correct inasmu .....

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elow:- Circular No. 721/37/2003-CX., dated 6-6-2003 This Board's Circular is still in force. As per Section 2 (d) of Central Excise Act, excisable goods means goods specified in [[the First Schedule and the Second Schedule] to the Central Excise Tariff Act, 1985 (5 of 1986)] as being subject to a duty of excise and includes salt; irrespective of the fact that whether CE duty is chargeable NIL by virtue of tariff rate or through any notification. Non-excisable goods are those which are not sp .....

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ed 1.3.2015. To cap it all, Board's circular should prevail. Dear Sir, Pl. let me know if I am in the wrong. - Reply By Mahir S - The Reply = In a number of cases, the Tribunal had to look at the issue of dutiability of empty barrels, empty containers, wooden crates, cardboard boxes and gunny bags in which duty-paid inputs were received. The Tribunal had, in almost all the cases, held that Modvat/Cenvat credit need not be reversed, as the packing materials in which the inputs were received w .....

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e of reversal of proportionate credit, it must be noted that any material required for manufacturing would necessarily be received in packed condition and removal of these packing material would not amount to removal of input.For instance, when chemicals are received in barrels, the removal of empty barrels, by any stretch of imagination, cannot be construed as removal of chemicals.This being so, it therefore appears that the question of reversal of credit under rule 6 utilized on the chemicals .....

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y By NANDAKUMAR PANICKER - The Reply = Dear all, I would like invite your kind attention to the explanation 1 inserted vide notification No. 6/2015 CE-NT dated 01.03.15 which states: for the purpose of this rule, exempted goods or final products as defined in clauses (d) and (h) of rule 2 shall include non-excisable goods cleared for consideration from the factory With the above, I feel that one has to pay 6% on the consideration received on such non-excisable goods. Please enlighten me. Thanks .....

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