Respected CA's,
We have a major concern. We are a trading company and are registered with Central Excise and have a Central Excise number.
Our agreement with the client who is a Steel Manufacturing Company is to supply them raw materials at Rs.30/KG with Transportation but excluding CST & Excise Duty. We are purchasing this particular raw material from our supplier at 26.2/KG on Ex-Works basis and we are paying Excise duty of 12.3%, CST of 2% & TCS of 1% on this 26.2/KG.
Our concern is should we charge our client an excise duty on Rs.30/KG or is it such that we can collect only the same amount of excise duty which we have paid i.e we have to collect 12.3% excise on 26.2/KG.
We want to charge excise duty on Rs.30/KG because if we charge excise on 24.9/KG our client will come to know the price at which we are purchasing and there would be a hard bargain. Please guide on this. Thanks.
CAclubindia
