16. Credit of duty on goods brought to the factory.-

(1) Where any goods on which duty had been paid at the time of removal thereof are brought to any factory for being re-made, refined, re-conditioned or for any other reason, the assessee shall state the particulars of such receipt in his records and shall be entitled to take CENVAT credit of the duty paid as if such goods are received as inputs under the CENVAT Credit Rules, 2002 and utilise this credit according to the said rules.

(2) If the process to which the goods are subjected before being removed does not amount to manufacture, the manufacturer shall pay an amount equal to the CENVAT credit taken under sub-rule (1) and in any other case the manufacturer shall pay duty on goods received under sub-rule (1) at the rate applicable on the date of removal and on the value determined under sub-section (2) of section 3 or section 4 or section 4A of the Act, as the case may be.

Explanation:- The amount paid under this sub-rule shall be allowed as CENVAT credit as if it was a duty paid by the manufacturer who removes the goods.

(Above Explanation has been inserted vide NTF. NO. 17/2003-CE(N.T.), DT. 13/03/2003 for further amendments)

(3) If there is any difficulty in following the provisions of sub-rule (1) and sub-rule (2), the assessee may receive the goods for being re-made, refined, re-conditioned or for any other reason and may remove the goods subsequently subject to such conditions as may be specified by the Commissioner.

16A. Removal of goods for job work, etc.-

Any inputs received in a factory may be removed as such or after being partially processed to a job worker for further processing, testing, repair, re-conditioning or any other purpose subject to the fulfillment of conditions specified in this behalf by the Commissioner of Central Excise having jurisdiction.(Above Rule 16A. has been inserted vide NTF. NO. 17/2003-CE(N.T.), DT. 13/03/2003 for further amendments)

16B. Special procedure for removal of semi-finished goods for certain purposes.-

The Commissioner of Central Excise may by special order and subject to conditions as may be specified by the Commissioner of Central Excise, permit a manufacturer to remove excisable goods which are in the nature of semi-finished goods, for carrying out certain manufacturing processes, to some other premises and to bring back such goods to his factory, without payment of duty, or to some other registered premises and allow these goods to be removed on payment of duty or without payment of duty for export from such other registered premises.

16C.- Special procedure for removal of excisable goods for carrying out certain processes.-

The Commissioner of Central Excise may, by special order and subject to such conditions as may be specified by him, permit a manufacturer to remove excisable goods manufactured in his factory, without payment of duty, for carrying out tests or any other process not amounting to manufacture, to any other premises, whether or not registered, and after carrying out such tests or any such other process may allow,-

(a) bringing back such goods to the said factory without payment of duty, for subsequent clearance for home consumption or export, as the case may be, or

(b) removal of such goods from the said other premises, for home consumption on payment of duty leviable thereon or without payment of duty for export, as the case may be:

Provided that this rule shall not apply to the goods known as “prototypes” which are sent out for trial or development test.

(Rule 16C has been substituted vide NTF. NO. 26/2006-CE(N.T.), Dt. 28/12/2006)

[OLD-

16C. Special procedure for removal of excisable goods for carrying out tests.-

The Commissioner of Central Excise may, by special order and subject to such conditions as may be specified by the Commissioner of Central Excise, permit a manufacturer to remove excisable goods manufactured in his factory for carrying out tests to some other premises and to bring back such goods to his factory, without payment of duty, or to some other registered premises and allow these goods to be removed on payment of duty, or without payment of duty for export from such other registered premises:

Provided that this rule shall not apply to the goods known as "prototypes" which are sent out for trial or development test. ]

(Rule 16B. & 16C. has been inserted vide NTF. NO. 01/2004-CE(N.T.), DT. 08/01/2004)

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