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TMI BlogJob Work under Central ExciseX X X X Extracts X X X X X X X X Extracts X X X X ..... repairing or reconditioning is done, no duty liability arises. On the other side, if job work amounts to manufacture, duty liability will arise and the fact who has supplied the raw material is immaterial. Now the question arises, who will bear the burden of duty liability in case of job-work? Normally, duty liability is of the actual manufacturer (Duty liability is of the job worker as he is the manufacturer) and not of the raw material supplier. However, if raw-material or semi-finished components are sent for job-work under Cenvat provisions or under notification no.214/86-CE no excise duty will be payable by the job-worker, duty liability is of manufacturer who is sending his inputs/ components for job work. In other cases, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich duty exemption is available under notifications, or e) by a manufacturer of dutiable and exempted final products, after discharging his obligation in respect of said goods under rule 6 of the CENVAT Credit Rules, 2002. Job work under Notification No. 214/ 86 Notification No. 214/ 86 provides for exemption from job work. Notification provides that 'Job worker' is exempt from all types of duties i.e. basic duty, special duty, additional duty (goods for special importance) and NCCD. The duty liability is of the supplier of raw material. The exemption contained in this notification shall be applicable to the goods, in respect of which the supplier of the raw materials or semi-finished goods gives an undertaking to the AC/ DC of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re as follows: - Job work under Notification no. 83/94 and Notification no. 84/94 - These notifications are applicable to SSI units having turnover below 150lakhs, who send the inputs for job-work . [For details see chapter no.7D 'JOB WORK AND SSI'] Job work under Notification no. 70/92 This notification provides exemption to goods manufactured in a factory as a job work and used by the specified undertakings in the manufacture of goods for supply to Ministry of Defence. The exemption contained in this notification shall be applicable to the goods, in respect of which the supplier of the raw materials gives an undertaking to the AC/ DC of central excise having jurisdiction over the factory of the job worker that aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Electronics Ltd 3. Bharat Dynamics Ltd 4. National Instruments Ltd., Calcutta 5. National Aerospace Laboratories 6. Indian Ordnance Factories belonging to the Central Government 7. Mishra Dhatu Nigam 8. Bharat Earth Movers Limited Valuation for job work - In case, where raw materials sent for job-work are not sent under Cenvat provisions or under any of the above notifications and if such job-work results in 'manufacture' of a product, duty liability will be of job worker. In such a situation assessable value will be calculated on the basis of cost of raw material plus job charges including processing expenses and the processor's (i.e. job worker's) profit. Thus, in case of job work, assessable will be the value at which the job ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owing are not includible in 'assessable value' - 1. Trader's or raw material supplier's profit and expenses (like advertisement, publicity, overheads) are not includible. 2. No further notional profit should be included, since job charges are already inclusive of the profit of the job worker. 3. Raw material cost should be exclusive of duty paid on raw material by the raw material supplier as this will be available as Cenvat credit while paying duty on finished goods. 4. Value of brand name will not be includible as brand name is undertaken by the assessee and not by the job-worker. 5. Cost of technical known-how supplied by the raw material supplier is not includible. If the raw material supplier and job worker are 'relat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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