Manufacture at customer location
Kuldeep
(Querist) 25 August 2011
This query is : Resolved
Dear Experts,
If a manufacturer of heavy machinery - say - heat treatment furnace (CETSH 8417000) manufactures the product at customer site. That is - the manufacturer purchases sub assemblis from vendors. He brings these sub assemblies (inputs)to his own factory and then sends to customers site. Then at customer site he actually manufactures the final product - i. e. heat treatment furnace. There is no doubt about the manufacture of the furnace. It is manufactured at customer site from these sub assemblies (inputs). My doubts are:
1. The manufacture takes place outside the manufacture's factory. It takes place at customer's factory. Customer's factory is already an excise registered factory for his own manufacture.So what about registration for the HT furnace manufacturer? Can / should he register a part of the customer's factory for his HT furnace manufacture activity?
2. The sub assemblies (inputs) will be purchased at the manufacturer's factory and then be sent to customer's factory for manufacture of final product (HT Furnace). What procedure to be followed for removal to customer's factory? Because this is not removal under Rule 4(5) (a) to job worker.
3. Can the manufacturer avail cenvat credit of the sub assemblies (inputs)? Can the department take a stand that these inputs are not used in the factory of manufacturer?