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Mritunjay

ca final new

74 Points Posted on 23 January 2011

Is it Correct???????????

Q. The goods manufactured by B& Co. were chargeabe to excise duty @ 10%. From 1-3-2011 additional excise duty @ 8% was imposed on such goods. On 4-3-2011, B & Co removed goods valuing Rs. 200000 out of lot manufactured prior to 1-3-2011. Compute the amount of excise duty payable on such removal?

Ans: The goods manufactured by B& Co. were not liable to additional excise duty prior to 1-3-2011 but were made subject to such additonal duty w.e.f. 1-3-2011. Hence no additional duty can be charged on the goods manufactured prior to 1-3-2011 even if they are removed on or after 1-3-11.

According to my opinion rate of excise duty shall be levied at such which is prevalent on the date of removal of goods. Hence such goods should be subjected to additional excise duty.

Replies (1)

pravin

student

44 Points Posted on 02 February 2011

Dear Mritunjay

Excise duty arise once the goods are manufactured. Hence the duty liability should be discharged when the goods are removed.

so in your case the goods are subjected to 10% duty when they are finished hence this duty liability has to paid to the govt. on the date of removal.

Even though add. duty is imposed on the goods, will not be applicable to goods. because the duty was not in force when the goods are taken as finished. so there is no liability to pay add. excise duty.