Government of India
Ministry of Finance
(Department of Revenue), New Delhi
Subject: Problems faced in availing Modvat on Bill of Entry/ 52A Invoice in the name of registered Office/Head Office but credit to be availed by the factory- Regarding.
Attention of the Board has been invited to difficulties faced by the manufacturers in availing the credit under rule 57G/ 57T where:-
(i) the Bill of Entry has been filed in the name of the registered office/ head office of the manufacturer for the inputs to be used in his factory.
(ii) Imported goods lying in customs dock area/ bonded warehouse are diverted to manufacturing units in whose name Bill of Entry has not been filed.
(iii) domestic duty paid goods consigned to manufacturing unit are diverted in whole or part from a duty paid godown of the manufacturer of such diversion is affected transit.
2. The issue has been examined by the Board.
3. It has been decided that credit should not be denied where the Bill of Entry is in the name of registered office/ head office provided that:-
(a) the entire consignment covered by the said Bill of Entry is received it the factory in original packed conditions.
(b) triplicate copy of Bill of Entry/ duplicate copy of the Bill of Entry generated on EDI system is endorsed by the registered office/ head office to the effect that consignment covered by the Bill of Entry are delivered to manufacturing unit for availing credit.
4. Where the imported goods are still in Customs dock area and the manufacturer/ importer decides to divert/ transfer the goods, a declaration by the manufacturer/ importer can be made on the reverse of triplicate copy of Bill of Entry/ duplicate copy of the Bill of Entry generated on EDI system by the manufacturer/ importer that consignments are being delivered to the unit (name of the unit) for availing credit and endorsed by the Proper Officer of Customs for enabling the manufacturing unit to avail credit.
5. In case where the imported goods are lying in the bonded warehouse from where diversion takes place either of entire consignment or part consignment, credit can be permitted provided ex-bond Bill of Entry is filed for such entire/ part consignments and that a declarations is made on the reverse of the said ex-bond triplicate copy of the Bill of Entry/ duplicate copy of the Bill of Entry generated on EDI system to the effect that consignments are delivered to a unit (name of the unit) for availing credit.
6. In all cases duty paying documents on the basis of which credit has been availed in aforesaid cases, should be submitted to the Range Superintendent for the necessary verification and defacing/ endorsement,
7. In case of split consignments and other type of cases not covered by the preceding paragraphs the inputs can be cleared on the payment of duty as envisaged under rule 57F/57S and on the basis of such duty paying documents credit can be availed.
8. Pending cases may be decided in the light of the above.
9. The above instructions may be brought to the notice of the field formations.
10. Trade interest may also be suitably informed.
11. The receipt of this Circular may please be acknowledged.