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Exempted and dutiable goods

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..... Dear experts If one of client manufactures exempted goods and value is rs 8 crores and now he want to manufactures dutiable goods then benefit of 150 lakhs is available on dutiable goods or not means for the purpose of calculation of turnover of 150 lakhs whether clearances of exempted goods shall be clubbed or not Thanks in advance. - Reply By CS SANJAY MALHOTRA - The Reply = No, he can;'t be classified as SSI unit if the Turnover in previous F.Y. has crossed ₹ 4 cr. Benefit of SSI Notification No 08/13 is available if the Turnover does not exceed ₹ 4 cr in previous F.Y. and further the exemption of duty holds good for first taxable clearances of ₹ 1.50 cr, beyond which normal rate of duty applies. For arrivi .....

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..... ng at value of ₹ 1.50 cr, Export Turnover, Goods exempt from duty, Sales under Brands name, Sales to SEZ, EOU... - Reply By CS SANJAY MALHOTRA - The Reply = Please read the Notification as 08/2003 .... - Reply By KASTURI SETHI - The Reply = I endorse the views of Sh.CS Sanjay Malhotra, Sir. If a manufacturer makes clearances of more than 4 crores in its first year of the commencement of production, he is eligible for SSI exemption of ₹ 1.50 crore. - Reply By Mahir S - The Reply = Sir, It may be noted that while computing the limit of ₹ 400 Lakh, the turnover of goods exempted under any other notification (except clearances to FTZ, SEZ, 100% EOU, EHTP/STP, UN, etc. and specific job work notifications) has to be incl .....

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..... uded. If the goods are exempted by virtue of any notification, then the same are required to be included for computing the limit of ₹ 400 lakhs. However, if the goods are Non excisable, then it is not required to be included for computing the limit of ₹ 400 lakhs. Hence, you have to take decision based on whether the goods of ₹ 8 crores discussed in your query are exempted goods or non excisable goods, and thereafter confirm yourself if the SSI benefit in this case shall be available to you or not. - Reply By KASTURI SETHI - The Reply = Re-examined. Agreed fully with the replies of Sh.Mahir S, Sir and Sh.CS Sanjay Malhotra, Sir regarding computation of Rs.four hundred lakhs for eligibility as SSI unit in central Ex .....

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..... cise.Thanks to both experts. - Reply By Mahir S - The Reply = - Reply By KASTURI SETHI - The Reply = Sh.C.S.Sanjay Malhotra Ji, Sir, There is some snag in the software of TMI so I could not reach you. Moreover, you have not mentioned your email Id. in your profile. So I am posting my views on this forum. A manufacturer commence his business of production of specified goods(under Notification No.8/2003-CE ) in his factory for the first time i n 2015-16 and his turnover of four crores crosses on 12.3.16 . From this situation two points emerge:- 1. Will he not be entitled to threshold exemption limit of ₹ 1.50 crore? I am of the view that he is eligible for first clearance of ₹ 1.50 crore on the ground that his tu .....

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..... rnover of excisable goods was NIL during the preceding year (2014-15). (Emphasis supplied on Para 2(vii) of Notification No.8/2003-CE ). 2. When will he lose the status of SSI for Central Excise purpose? Since the manufacturer crosses turnover of ₹ 4 crores on 12.3.16, he will be no more SSI unit from 12.3.16 onwards. Since his turnover during the preceding year was NIL, so his status of SSI unit will remain intact up to 11.3.2016 and thus he will be eligible for first clearance of the value of ₹ 1.50 crore. 3. Will he lose the status of SSI unit for the whole year 2015-16 or from 12.3.16 onwards? I want your considered views for enrichment of my knowledge. I hope you will oblige me on this forum. Thanks .....

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..... a lot. With regards. K.L.SETHI - Reply By CS SANJAY MALHOTRA - The Reply = Respected Sir Sh. Kasturi ji, Always feel obliged to interact act with you as it always refreshes my memory. Sir you are absolutely correct and there is statutory background to your view points. Assessee should be meet the criteria of SSI Eligibility i nitially in terms of Investment in P M to be eligible for SSI Exemption under Notf 08/2003 of Central Excise. Unit is eligible for SSI Exemption upto First Turnover of ₹ 150 Lacs in the current year even if he has started Manufacturing operations from April 1 of the current F.Y. (Exemption is based on turnover of Previous Year). - This is similar to the concept in Service Tax, wherein Tax lia .....

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..... bility commences after ₹ 10 Lacs even if the service provider commences business in current F.Y. In short, no duty to be paid on the tax concessions claimed earlier on first turnover of ₹ 150 Lacs. From Next F.Y., duty is to be discarged from Zero point. SSI Status for the purpose of Central Excise Duty will not hold good from 01.04.2016 (from next F.Y,) as the assessee has availed Concessional of Excise Duty upto Ist Turnover of ₹ 150 Lacs during F.Y. 15-16 and afterwards have paid duty at the Normal Rate beyond turnover of ₹ 150 Lacs. (Hence turnover or than ₹ 400 Lacs does not matter in F.Y. 15-16 as duty have been paid off at normal rate beyond ₹ 150 Lacs turnover). Unit will not loose the s .....

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..... tatus for whole year. Tax concessions which SSI has enjoyed can;t be paid back. (Covered in Point No 1 above). My e-mail id is sanjaymalhotra.cs@gmail.com (Sir, you can connect anytime, would be honoured). - Reply By KASTURI SETHI - The Reply = Sh.CS Sanjay Malhotra Ji, Thanks a lot for validation of my views, Sir. I was a bit shaken when you informed me that I missed to write the word, 'NOT'. So I thoroughly perused all the relevant notifications word for word on the SSI issue before expressing my views again on this forum. However, efforts have not ended in smoke rather yielded better results as the concept is clearer to me now. Agreed with other parameter highlighted by you. .....

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..... Your email Id will be helpful to me in future.Thanks. With regards SETHI - Reply By CS SANJAY MALHOTRA - The Reply = Respected Sh Kasturi ji, Regret, I missed the phrase first clearances of your opinion. Your views are correct as per the provisions of law. - Reply By KASTURI SETHI - The Reply = SH. CS SANJAY MALHOTRA JI, Sir, Anyhow, upholding my views by you, has a great value for me. Really from the core of my heart. No exaggeration here. You always go into depth of the issue. It is a fact. Thanks a lot. - Exempted and dutiable goods - Query Started By: - varun arora Dated:- 8-3-2016 Central Excise - Got 11 Replies - Central Excise - Discussion Forum - Knowledge .....

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..... Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax .....

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