Skip to main content

Excise Notifications

Dear Professional Colleague,

Mystery of Confusing Notifications on applicability of Excise Duty on Textiles, Mobile phone, Note books, Spectacles, Calculators, Water filters, Sauces and ketchups, Bicycles, etc.
The Central Board of Excise and Customs ("the CBEC" or "the Board") has issued three Central Excise Notifications apparently to clarify when manufacturers can avail exemption or concessional rates of CE duty.
·         Notification No.34/2015-Central Excise, Dated: July 17, 2015, amending Notification 30/2004-CE, which provides for an exemption for certain textile articles
·         Notification No.35/2015-Central Excise, Dated: July 17, 2015, amending Notification 1/2011-CE, which prescribes an effective rate of 2% duty on certain goods
·         Notification No.36/2015-Central Excise, Dated: July 17, 2015, amending Notification 12/2012-CE:
-         Condition 16: Exemption for certain goods either wholly or partly – steel, Aluminium, Tablet Computer, Mobile handsets
-          Condition 20 Clause (a): Exemption for certain goods – Copper
-          Condition 25: Exemption for certain goods – fertilisers, goldsmith wares
-          Condition 52A: Exemption for certain goods – bunker fuels, solar water heater
Objective of these amendments are that the Manufacturer seeking to claim Nil rate of duty or 2% duty or any other Concessional rate of duty under the amended notifications:  
·         Procure Inputs/capital goods which are used for manufacture of excisable goods, on which "appropriate duty has been paid", be it Central Excise duty or the Additional duty of Customs;
·         Input services which are utilized for manufacture of excisable goods on which "appropriate service tax has been paid".
·         Manufacturers claiming the exemption should not avail CENVAT credit of duty/tax paid on inputs, capital goods, input services.
Issues arise because of these amendments: Whether the Manufacturer cannot claim Nil rate of duty or 2% duty or any other Concessional rate of duty under the amended notifications if:
·         Inputs/ capital goods is not liable to excise duty or where excise duty is nil, i.e. No excise duty is paid on Inputs/ capital goods which are used for manufacture of excisable goods.
·         Input Services is not liable to service tax or where service tax is exempted.
Because of the said amendments, there is hue and cry among the diverse section of manufacturers, manufacturing – Readymade garments, Mobile phone, Note books, Spectacles, Calculators, Water filters, Sauces and ketchups, Bicycles, etc.
Mystery resolved by the Board:
Now, the Board has issued three Notifications No. 37/2015-CE, 38/2015-CE, 39/2015-CE, dated July 21, 2015, to correct the mystery created by the Notification Nos. 34/2015-CE, 35/2015-CE and 36/2015-CE dated July 17, 2015 and issued a Circular No. 1005/12/2015-CX dated July 21, 2015, clarifying apprehensions have been raised about the use of the phrase of "appropriate duty". In this regard, an Explanation has been inserted in the  Notifications No. 30/2004-CE dated July 9, 2004, Notification No.1/2011-CE dated March 1, 2011 and Notification No. 12/2012-CE dated March 17, 2012 so as to clarify that the appropriate duty or appropriate additional duty or appropriate service tax for the purposes of the said notifications/entries includes NIL duty/ tax or Concessional duty/tax, whether or not read with any relevant exemption notification for the time being in force.
Hence, the domestically manufactured goods covered under these Notifications/Entries continue to be exempt from Excise duty or subject to Concessional rate of excise duty, as the case may be as they were prior to July 17, 2015.
Hope the information will assist you in your Professional endeavours. In case of any query/ information, please do not hesitate to write back to us.
Thanks & Best Regards.
Bimal Jain
FCA, FCS, LLB, B.Com (Hons)


Popular posts from this blog


CONTENTS SR. NO. CHAPTER PAGE NO. INTRODUCTION STOCK & RECEIVABLES AUDIT VERIFICATION OF STOCK & DEBTORS PROCEDURE OF STOCK AUDIT VERIFICATION OF SECURITIES ANALYTICAL REVIEW INTERNAL CONTROL QUESTIONNAIRE STOCK b) BOOK DEBTS LIST OF DOCUMENTS TAKEN AS WORKING PAPERS SPECIMEN INSPECTION REPORT SPECIMEN MANAGEMENT REPRESENTATION LETTER CHAPTER 1 INTRODUCTION: Banking is an important sector of the economy of any country and for the development of the economy a healthy banking system is a must. After the liberalization of the economy, the banking system has undergone a total change in India. There is hard competition in the banking industry to survive in the current circumstances. With the purpose to have better financial discipline & to ensure uniformity in accounting norms RBI introduced the concept of assetclassification & income recognition as per the recommendations of Narasimhan Committee. It was also suggested to classify the advances given by banks into Performing & Non Perfor…

Excel Add-in to convert amount in figures to words by Premal

AmtInWords.xla is attached to this mail. It is an MS Excel Add-in written by me to convert amount available in figures to words.
Copy the attached file to the folder where excel stores the add-ins. (To know where excel stores the add-ins, open any workbook, click on Tools - Add-ins - Browse)
Then open an excel workbook. Click on Tools - Add-ins - Browse - Give the path to this Addin - Ok
You can use the functions AmtInWords and AmtInWordsUS in any worksheet. The syntax is:
=AmtInWords(decimal number/cell reference, [currency code])
=AmtInWordsUS(decimal number/cell reference, [currency code])
Examples follow:
=AmtInWordsUS(B3) ' Shall give the amount in millions (US format)
=AmtInWordsUS(B3,"USD") ' Shall give the amount in millions (US format) and in US currency (Dollars)
=AmtInWords(C4,"GBP") ' Shall give the amount in lakhs and in UK currency (Pounds)
The system shall N…

A Complete Guide to sections 54 & 54F Exemptions - T.V. GANESAN CS

A Complete Guide to sections 54 & 54F Exemptions T.V. GANESAN CS If an individual transfers any long-term capital asset and plans to reinvest the sale proceeds in a new residential house property then he would be eligible to claim exemption under sections 54 and 54F of the Income-tax Act, 1961 subject to fulfilment of certain conditions. In the last couple of years there has been a phenomenal increase in the sale of properties resulting in capital gain including but not limited to the land owners giving the land to the developers and entering into Joint Development Agreement, receiving more than one flat from the builder and yet avoiding capital gains tax. In this article the author has enumerated various decisions and judgments of the Tribunals and the High Courts which have liberally interpreted the provisions of the Income-tax Act and extended the capital gains exemptions to the assessees. Introduction 1. Out of the various investment options available, investment in real estate …