GOVT NOTIFICATION NO 51/96-CUSTOM DATED 23/07/1996, Central Excise

[JOSEPH MATHEW]

We have received a certificate of registration from IIT Chennai for Excise exemption in terms of Govt Notification no 51/96-Customs dated 23/07/1996 and Central Excise duty exemption in terms of Govt.Notification No 10/97-Central Excise dated 01/03/1997 as amended from time to time.

My query is this certificate says that we have not to pay excise, however our customs says we have to pay @6% excise duty. Kindly clarify,.

regards

Joseph Mathew

Posts / Replies

[Rajagopalan Ranganathan]

Sir,

Notification No. 51/96-CUS dated 23.07.1996 states that 5% duty is leviable and exempt from whole of additional custom leviable under section 3 of Customs Tariff Act. Under Central Excise, Notification No. 10/97-CE dated 01.03.1997 exempts the said goods from the whole of excise duty leviable. Therefore any goods imported for research purupose is leviable to 5% duty and any goods procured from domestic manufactures is fully exempted.

[JOSEPH MATHEW]

Sir,

We do not keep finished goods seperate in our warehouse for goods supplied to R&D. However we take credit for raw materials purchased for production. As per tje excise officer, he is asking us to charge 6% excise for the goods sold and the party has given notification for the same.

Please guide us is this right.

[Mahir S]

Sir,

refer sub rule (6) of rule 6 of cenvat credit rules 2004, wherein 6 % reversal is not required. in all other cases, it is mandatory for the 6 % reversal under rule 6.

[GANTI SARMA]

As per the notification 10/1997, you have to maintain separate records and your are not eligible to avail credit on inputs used in exempted final goods. Other wise you have to pay 6% on assessable value.