How can we save excise duty on indirect export

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Amit Rajoria

Admin Executive

23 Points Posted on 20 April 2012

How can we save tax on indirect export? We got an order from foreign country for steel piping material, we situated at gurgaon and we pass on the order to the manufacturer situated at mumbai, as we are neither manufacturer nor registered in Excise Dept. We are registered in VAT/CST, Service Tax and having the IEC code for import and export. We usually imported goods from foreign country and export to foreign country as well. Further, I know that Export is free from all type of duty, but being a merchant or indirect exporter this time, our mumbai vendor (will export final goods on our behalf) will raise invoice to us with charging us excise duty of 12.36% and upon giving him a Form H, he will not charge VAT/CST to us. So, in this case, I want to know that how can we save excise duty as well, being a merchant or indirect exporter??? our vendor in mumbai is registered in excise as well as in VAT/CST and Service Tax also.

Replies (8)

praveen

Chartered Accountant

5709 Points Posted on 20 April 2012

See there is only one way for you now. You have to get registered under the excise law and then claim the input and ask for refund. I think its under RULE 5

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nilesh

Indirect Tax

91 Points Posted on 20 April 2012

there is may one option if your vendor will agree,

vendor will dispatch the material against UT - 1, (direct export)

DAYANANDA K N

ACCOUNTS EXCECUTIVE

541 Points Posted on 20 April 2012

I dont think you can save on excise duty. One way you can reduce the burden by caliming duty drawback under customs act Sec 75. Please check.

Regards

Dayananda

satya

Executive Excise

1312 Points Posted on 21 April 2012

Hi, Neelesh,

It is not UT-1, I think it is CT-1 (Merchant Exports). for Manufacturer Exports purpose , you have to obtain a Letter of Under Taking from your Asst/Deputy Commissioer of CEx.

Prabhat Kumar

Advocate & Consultant

1820 Points Posted on 23 April 2012

You should take benefit of the notification No. 42/2001(N.T.) Central Excise dated 26.06.2001. In your case you act as a merchant exporter and obtained the CT-1 certificate after executing the B-1 bond. Then you will be able to procure the goods to be exported without payment of duty. There after you can export the goods and submit proof of export for discharging your bond obligation.

Sunil Kumar G

AGM Taxation

446 Points Posted on 04 May 2012

Completely agree with Mr. Prabhat Kumar. As a merchat exporter you should buy under CT-1 after execution in B-1 Bond. There is no requirement of Letter of Undertaking.

shubham agiwal

student

23 Points Posted on 19 July 2015

MY CLIENT EXPORT THE FINISHED GOODS THROUGH MERCHANT EXPORTER.

WHAT DOCUMENTS REQUIRED TO BE SUBMITTED IN EXCISE DEPT. AS PROOF OF EXPORT.FOR DIRECT EXPORT OR EXPORT THROUGH MERCHANT ?

AS I KNOW

1. ORIGINAL A.R.E ( CERTIFIED BY CUSTOMS IN TWO COPIES)

2. BILL OF LADING

Niraj Kumar Sinha

Sr. Officer SPSIL

469 Points Posted on 20 July 2015

For Direct Export: ORIGINAL A.R.E ( CERTIFIED BY CUSTOMS IN TWO COPIES), Shipping Bill and Bill of Lading.

For Merchant Export: Merchant Exporter will obtained a certificate as proof of Export from his Excise Commissionerate and he will provide you this. This will be submitted by you to your Excise department as proof of export.