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CMA Final · Indirect Tax Laws and Practice · Transition to GST (Transitional Provisions)

Kaveri Pharma Ltd removed excisable goods without payment of duty to a laboratory for tests not amounting to manufacture before the appointed day. The goods return after the appointed day within the permitted period. For no tax to be payable, which condition must be met under section 141(4)?

The manufacturer and the job worker must both declare the details of inputs or goods held in stock by the job worker on the appointed day, in the prescribed form and manner and within the prescribed time. Without this declaration the exemption does not apply. The premises need not be registered.

  1. AThe laboratory must be a registered person under the existing law
  2. BThe goods must have been exported before returning
  3. CThe manufacturer and the job worker must declare details of the goods held in stock by the job worker on the appointed day, in the prescribed form, manner and timeCorrect
  4. DThe manufacturer must pay tax at half the normal rate on return

Explanation

Section 141(4) makes the tax exemption under sub-sections (1), (2) and (3) conditional on both parties declaring the details of goods held in stock by the job worker on the appointed day in the prescribed form, manner and time. Section 141(3) covers premises whether registered or not, so registration is not needed.

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