EXCISE EXAMPTION LIMIT FOR BRANDED GARMENT MANUFACTURER

Dear Rajesh jee,



 



Thanks for the reply, I will be glad if u put more light on it.



1.     My last  year turnover is below 1.5 crore but current year turnover will touché 2.5crore so what about 2011-12, I mean the first clearance is 1.5 crore for next year but what is 2nd clearance and how to deal with it.

- for current year 2010-11 your turnover is liable to excise duty above 1.5 crore.

- for 2011-12 you can avail benefit or exemption of 1.5 cr without input credit or pay duty from zero with input credit. 



2.      You have mentioned (Turnover shall be calculated as section 4 value of Centtral Excise. Presently it is 40% of the Retail sale price  )  but let me give more details.

- The excise duty levy on branded ready made garments will be based on Retail Sale price, with abatement of 40%. That means, the excise duty will be levied at 10% on 60% of the retail sale price. 

The product that I make are sold in  anchor stores like Shopper’s stop under my brand name under the SOR basis ( sold otherwise returned back )  and we put the MRP on the product, in return they deduct their margin of 34% and 5% VAT and pay us the remaining 61% for whatever is sold and unsold ones are returned to us, plus during the SALE period the MRP less 40% discounts to customers = sold price less their margin of 34% and 5% VAT is deducted and we get the balance payment, in this case how the calculation will be made ?

- get VAT registration and then dealer will not deduct VAT from you.

3.     Do we have to follow any specific format of invoice when we becomes eligible to pay duty ?

- excise invoice is available in market with vendors who are dealing in forms and registers.

4.     For future business can I have 2 different companies ( both different or same proprietor or partners or directors )  and manufacture the goods under the common brand name ( one single brand name for both companies ) to avail the exemption limits ? or their has to be different brand names for both the companies ?

- in excise such concepts does not work usually, coz they have broader network of anti evation and when get caught the turnover get clubbed, so the benefits may be seen instant but painful at the end. 

Please advise,



Thanking u in advance.



Regards.



Bobby.