There could be various situations which we have examined separately as follows:
A. Goods Earlier exempted now exemption withdrawn./ Not liable or nil rated in Central Excise tariff
• Goods removed prior to 10.7.2012 not liable: This would be even if finished goods are removed to depots or warehouses. Subsequent sales should have stamp that these goods have been manufactured and removed from factory prior to 10.7.12 to avoid seizure in between.
• Goods at job workers premises in progress, in stock at factory/ies liable
• Whether manufacturing own / unbranded goods: If so then the value of manufactured goods in 13- 14 is to be examined. [ including exempted goods] This is to determine whether the SSI exemption of Rs. 150 Lakhs is eligible for goods removed after 10 July 14.
• If branded goods or not SSI then liable from 10th July midnight.
• Registration of factory/ies, dealers who supply major material under CE
• Stock taking and availment of credit on stocks in hand
• Invoice/ Delivery documents format with adequate disclosure’s.
• Paying duty after adjusting credit by 5th of August 2014
• Filing of returns by 10th August 2014.
B. Added to Process amounting to Manufacture in Chapter notes.
• First time goods made liable or process amounting to manufacture – Liability from the notified date.
• Procuring all inputs under duty paying documents
• Removing all finished goods after they are manufactured promptly to the customer or depot.
• Getting registration etc as in case of A above and all subsequent activities thereon.
C. Reduction in rate: This maybe unlikely. However if this happens all goods in factory still to be removed when removed would be at lower rate from 10th July midnight.
D. Increase in rate: All goods in factory would be removed at higher rate from 10th July Midnight.
E. Exempted: All goods post midnight of 10july would not be on payment of duty mentioning that these are removed post 10th July if document not clear. Further the cenvat credit on raw material, WIP, FG which are still in stock may require to be reversed.
Post Budget 2014 – Service Tax
The changes possible are only by way of change in rate, withdrawal of exemption or addition to negative list/ exempted services. See template.
Post Budget 2014- Customs
The changes would depend on the filing of the Bill of Entry for imported goods as well as those which are removed from the bonded warehouse. See template.
Template for IDT
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Impact of Budget - Template- Indirect Taxes- [Normal Applicability unless specifically set out] |
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Central Excise |
Applicable from |
Applicable to |
Not Applicable to |
|
1. Increase in rate [ from 2-4 or 12 -14] |
Midnight 10th July |
Fin. Goods in Factory |
Goods removed to depot |
|
FG with JW- Third party |
Goods in Transit to customers |
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Inputs "as such"- cr. reversed |
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2. Decrease in rate [ from 12 -10] |
As above |
As above |
As above |
|
3. Earlier exemption withdrawn |
As above |
As above |
As above |
|
Stock Taking of RM/ WIP/FG needed |
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Evaluation of SSI etc |
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|
4. Earlier nil rate now levied for 1st time |
As above |
As above |
As above |
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Stock Taking of RM/ WIP/FG needed |
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|
5. Deemed Manufacture added |
On passing of Bill + |
Goods deemed mfred after date |
Fin. Goods in Factory |
|
Stock Taking of RM/ WIP/FG needed |
On Pres. Accent |
Goods removed to depot |
|
|
Evaluation of SSI etc |
Goods in Transit to customers |
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6. MRP added |
wef date notified |
goods removed after date |
same as above |
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Service Tax |
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a. Increase/ decrease |
Maybe dt specified |
services after such date/ invoice raised/advance received[could be 2 out of three post change then increase/decrease applies] |
Completed Service-risk could be |
|
POTR as Relevant* |
taxed as change in effective rate |
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b. Additional to Negative List + Exempt. |
Maybe dt specified |
Services provided after such date |
completed services |
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POTR as Relevant* |
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c. Withdrawal from Negative + exempt. |
As above |
services after such date taxed |
Completed Service |
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* POTR may be amended.- However date |
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rendering service maybe important.-wrt Constitution |
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Customs Duty |
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i. Increase/ Decrease in rate |
10 July Midnight |
BOE filed after 10th |
BOE filed before 10th |
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BOE filing |
Goods in Warehouse pn 10th-not |
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crossed customs frontier |
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ii. Exemption/ Withdrawal |
As above |
As above |
As above |
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AL IDT |
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Rules / Notification normally date specified |
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Provisional Collection Act may have to |
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be seen. |
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Areas of Doubt: |
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Changes in exemptions entries-what if dates from when applicable not specified |
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Retrospective amendments-beneficial/detrimental |
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