Excise duty pass on input clear as such as

474 views 2 replies

Ashok Swain

Sr. Accountant

31 Points Joined August 2011

We are registered as manufacturer in excise. We import goods, pay 12.5%CVD, 4% SAD and some of materials sell to manufacturers (excisable invoice). But we are able to pass only CVD (as excise duty) and not SAD, as we have to charge VAT which we have to pay to sales tax dept. Eg: Import CIF:100/-......CVD paid:12.5/-......SAD paid:4/-(approx). Excise invoice:100+12.5(excise duty)+4(VAT)=116.5/-. Now this VAT is collected and paid to sales tax. We only passed Rs.12.5(as excise) out of Rs.16.5 paid to customs. We Or am I making a mistake in invoicing? Any information/help appreciated.

Replies (2)

Madhukar N Hiregange

Chartered Accountant

39039 Points Joined September 2008

Imported goods when sold to other manufacturers- 2 options.

Opt-1: Avail credit of CVD + SAD and pass on both as Rule 3(5) does not bar. Cusotmer avails credit of whole of excise.

For past year also you can raise an invoice only for SAD not collected and charge the VAT on that if customer willing to reimburse. He would get the whole of SAD credit.

Opt- 2: Avail only CVD credit and go for refund of SAD showing proof of having paid VAT. Bit more cumbersome. Some dealers prefer this route when they sell to cusotmers who are not interested in credit of excise duty.