Excise duty - molasses

1832 views 3 replies

Ritzz

CA Final - Article

365 Points Joined January 2010

Dear Friends

I have a query.

Why is the Central Excise duty on Molasses payable by buyer and not by the manufacture? What is the logic behind it??

regards

Replies (3)

Chinnu Raj

CA Final Student B.Com

1067 Points Joined July 2012

Here is the logic for that, molasses is also a form of ethyl alcohol, and is effectively used for making country liquor. And in India we have the problem of illegal manufacturing of country liquor and also after consuming the country liquor many a time people lose their life, so this is a double edged sword for the government, so the government wanted put a check on that.

So the rule was made in such a manner to prevent mill molasses being used in illegal distilleries which evade very high duty on rum alcoholic drinks and also which operates illegally and are prejudicial to the public interest.

Ritzz

CA Final - Article

365 Points Joined January 2010

Thanks for replying! But i still have difficulty in understanding the logic.

I hope someone would explain the same in a layman's language.

Regards

Chinnu Raj

CA Final Student B.Com

1067 Points Joined July 2012

Hii Rohan,its nothing frnd.As the country liquor is harmful and many of them had losen their lives and in order to be in the safe side the people who purchase it should only pay the tax instead the company paying it.

Hope now you got it.......