Indirect taxes
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Class room work teaching charts CA N.Rajasekhar M.com FCA DISA (ICAI)
CA CLUES
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Excise Charging section. Sec. 3 of CEA
I
III
rates Specified in I st & II nd Schedule of CETA
o
EOU, EPZ, STP, EHTP
Goods manufactured by Govt
II
As per
CE rules
Administrative Convenience (At the time of removal) as per-
Excisable Goods manufactured in SEZ
IV
When Goods removed to DTA (use in India) also
Pay 50% of BCD + Excise duty
Excluded excisable goods (No Excise duty)
Value is to be made as per
Manufacture under central excise sec 2(f) First part: Process- Incidental/Ancillary for completion of product
Manufacture
are
Customs valuation
Karya Palak Engineer vs. Rajasthan Taxation Board 2004 AIR (SC).
Excise duty payable
Name test/use test to apply to find out change
Mfg implies change, but every change is not a manufacture. In the process new product should emerge with new name, different use, different character, then only manufacture
Output should be New Product.( It is mandatory) Voluminous- Judicial rulings to decide
Delhi cloth mills (SC) Ujagar Prints (SC) Parle products (SC) Around 78 listed. Process mentioned in Emergence of section/Chapter notes of New Product is Central excise tariff Not relevant
Second part: Deemed Manufacture
Deemed manufacture concept upheld in Empire Industries (SC)
CA
VI
Pay as per
Collection Of duty by Govt.
CL
V
Excise duty
Manufacture/ Production of Excisable goods in India
on
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Levy (fixing liability)
Dept. cannot demand duty on goods stored in factory/ godown/ warehouse
SD Fine Chemicals (SC)
Purpose – raising additional revenue by taxing activities which lead to substantial value addition
CA N.Rajasekhar FCA,DISA(ICAI) Chennai 9444019860,
[email protected] Body building of vehicles, Audio video recording in tapes, Galvanizing of iron steel, conversion of powder in to tablets, Refining of edible oils Drawing wire from rod,. Branding and labeling (Apparels & Clothing Accessories) Packing from bulk to Smaller containers, labeling or relabeling, alteration of retail price or doing any process goods making marketable for Sch III of CEA (MRP Valuation goods)-
1.Value addition in the packing activity is mandatory to call as deemed manufacture and levy of ED.
2.If good are already marketable, mere packing and repacking them is not a manufacture. 3. Labeling/relabeling should include declaration or alteration of retail sale price. mere labeling or relabeling will not be ‘deemed manufacture Mumbai vs. BOC (I) Ltd. 2008 (226) ELT 323 (SC 2
India for the purpose of Excise duty DTA (Domestic Tariff Area) All States and Union Territories including J &K
Land 1
EOU, EHTP, STP, EPZ For removals to DTA
Land 2
SEZ (Excluded area For the purpose of India)
Land 3
India
Excise duty Liability Attract (Duty payable.)
Up to 200 Nautical Miles- Exclusive Economic Zone
Sea 1
Sea
Excise duty liability do not attract (Excise duty not payable)
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