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Government of India
Ministry of Finance
(Department of Revenue)
Tax Research Unit
*****
Circular No. 1045/33/2016-CX
New Delhi, the 26th July, 2016
To,
Principal Chief Commissioners / Chief Commissioners of Central Excise (All);
Principal Chief Commissioners / Chief Commissioners of Customs & Central Excise
(All);
All Director Generals of Customs, Central Excise & Service Tax
Madam / Sir,
Subject: Taxability of stock on February 29, 2016 – Excise duty imposition on
articles of jewellery in the Budget 2016-17 – regarding
In this year’s Budget, central excise duty of 1% without input and capital goods
tax credit or 12.5% with credit was imposed on articles of jewellery falling
under heading 7113 of the First Schedule to the Central Excise Tariff 1985.
Subsequent to that, the Government had set up a Sub-Committee of the High Level
Committee, headed by Dr. Ashok Lahiri to interact with Trade & Industry on
issues relating to procedure and compliance relating to excise duty of articles
of jewellery. The Sub-Committee has given its report on 23.06.201 6, which has
been accepted by the Government.
2. The Sub-Committee in its report has examined in detail excise duty liability
on stock on 29th February, 2016 and has given its recommendations on the issue.
Accordingly, it is hereby clarified that:
i. All jewellery manufactured and removed, on or before February 29, 2016, from
the premises of the job workers or any other premises where such articles of
jewellery were manufactured, and
(a) lying at different premises (including branches) of the principal
manufacturer, or
(b) sent on approval to potential customers, will not be liable to excise duty.
Furthermore, no stock declaration is required to be filed by a jeweller for this
purpose with the jurisdictional central excise authorities.
ii. For the stock lying, as on February 29, 2016, with the job worker or any
other premises where articles of jewellery were manufactured [including finished
articles of jewellery as well as work in progress], the manufacturer or
principal manufacturer, as the case may be, shall self-assess excise duty
liability on such articles of jewellery or articles of jewellery manufactured
out of such work in progress, received on and after 1st March, 2016, at the
point of first sale of such articles of jewellery as per the Articles of
Jewellery (Collection of Duty) Rules, 2016.
3. Hindi version will follow. Trade Notice/Public Notice may be issued on the
above lines.
4. Difficulties faced, if any, in implementation of this Circular may be brought
to the notice of the Board.
(Anurag Sehgal)
Under Secretary to the Government of India
F. No. 354/25/2016 – TRU (Pt.-I)
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