banner_ad

treatment of discounts for assessble value

EXICSE (Legacy) 2243 views 4 replies

how r various discounts treated for arriving at assessable value viz.

 

qty discount

trade discount

cash discount

 

pls help i am taking dec 2010 cwa inter exams

reg

ajay

cwa inter

 

Replies (4)

in the eyes of excise department , the invoice value is to be taken for calculation of tax liability. balance discounts if allowed prior to invoice value is ok, but post invoice, nothing can be claimed.

transaction value will become assessable value on the basis of net amount paid or payable hence all discount whether   cash or trade etc. will be excluded

All discount will be taken for calculated Assessable value.   if it is shown in invoice that will also taken for calculating excise duty amount.

Firstly u have to understand term :

Quantity Discount:

Incentive offered by a seller to a buyer for purchasing or ordering greater than usual or normal quantity of goods or materials, to be delivered at one time or over a specified period.

 

Trade discount :

Amount or rate by which the catalog, list, or retail price of an item is reduced when sold to a reseller. It is the reseller's profit margin and usually varies directly with the quantity of the item purchased


 Cash Discount:

Incentive offered by a seller to a buyer for settling the invoice immediately on delivery or in a period substantially shorter than the conventional period in that industry or market.

Answer:

All discount is deductible which made at the time of sale of goods for transction value (sec.4) . however discount given in nature of compensation for low grade quality material supplied after sale of goods is not allowed.


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Related Topics
Loading
Company
ARTICLESHIP 15 May 2026
ARTICLE ASSISTANT, TRAINEE AND PAID ASSISTANT

YOGESH KAPOOR AND ASSOCIATES

New Delhi

B.Com

View Details
Company
26 May 2026
CA / MBA (Finance) / CMA / M.Com (Finance)

Sri Aurobindo Gnostic Centre of Education

New Delhi

CA

View Details
Company
ARTICLESHIP 08 June 2026
Internal & Taxation Article

O P Bagla & Co LLP

New Delhi

CA Inter

View Details
Company
ARTICLESHIP 15 May 2026
Audit Assistant / Article Trainee / Intern

SSGS and Associates

Chennai

CA Inter

View Details
Company
ARTICLESHIP 14 May 2026
CA ARTICLE

PRAVEEN GARG & CO

Faridabad

CA Foundation

View Details
Company
26 May 2026
Senior Accountant cum purchase Manager

Vardhaman Group of India

Pimpri Chinchwad

CA Inter

View Details
Company
ARTICLESHIP 31 May 2026
Article Assistant

KPRS And Associates

New Delhi

CA Inter

View Details
Company
23 May 2026
Article Assistant

Geeta Manchanda & CO.

New Delhi

CA Inter

View Details