Skip to Content
author's profile photo Former Member
Former Member

subcontract scenario

Dear All

I have a scenario,

my company supplies the raw material to sub-contractor directly from vendors place, we will rec the finished product from sub contractor. pls advise how to utilize the excise duty credit.

Rgds

Ragavv

Add a comment
10|10000 characters needed characters exceeded

Related questions

4 Answers

  • author's profile photo Former Member
    Former Member
    Posted on Oct 07, 2010 at 11:26 AM

    Hi,

    Let me give you an example. I do not have a system where I can perform excise transaction. I am trying to guess you can test.

    You raise a PO for the raw material to vendor A. In the PO vendor you will mention as the sub con vendor. When you do GR it will be 101 wit special stk indicator O. Capture and post excise excise invoice against this 101. Now for the sub con part try creating a challan against this 101 and the other process continues. Try this and let meknow how it works.

    Regards

    Naveen

    Add a comment
    10|10000 characters needed characters exceeded

  • author's profile photo Former Member
    Former Member
    Posted on Oct 07, 2010 at 12:42 PM

    As far as I know, the party receiving the goods is eligible for cenvat credit.

    Hence when the material is sent from the vendor to the subcontractor, the subcontractor takes the excise credit.

    Hence you will not be able to utilize the credit.

    Now, if the subcontractor gives you a refund of the credit they have taken, the adjustment can be made via a credit memo entry (either via FB60 or MIRO). But there will be no excise entry.

    Regards,

    Aroop

    Add a comment
    10|10000 characters needed characters exceeded

  • author's profile photo Former Member
    Former Member
    Posted on Oct 07, 2010 at 12:53 PM

    hii

    Might be like this we can do ..

    Any way you will be receiving the invoice for raw material from vendor.

    So better receive the material only in system and later transfer material to subcontractor place only in system. But physically material will go directly to subcontractor place from ur vendor.

    So in this way u can avail the CENVAT .

    If this is wrong , can some body give the me explanation why its wrong ??

    Thanks

    Add a comment
    10|10000 characters needed characters exceeded

  • author's profile photo Former Member
    Former Member
    Posted on Oct 07, 2010 at 03:04 PM

    Hi dear

    In PO you can mentioned that material will directly delivered to Subcontractors place. You should ask your SC Vendor to confirm the material receipt in writing. Then you can enter GR in your company through MIGO where in you credit cenvat..

    Or else if SC vendor credits the cenvat he has to send you credit memo for the cenvat amount

    Regards

    Mandar

    Add a comment
    10|10000 characters needed characters exceeded

Before answering

You should only submit an answer when you are proposing a solution to the poster's problem. If you want the poster to clarify the question or provide more information, please leave a comment instead, requesting additional details. When answering, please include specifics, such as step-by-step instructions, context for the solution, and links to useful resources. Also, please make sure that you answer complies with our Rules of Engagement.
You must be Logged in to submit an answer.

Up to 10 attachments (including images) can be used with a maximum of 1.0 MB each and 10.5 MB total.