Types of excise duties

Types of excise duties

1. Dr.P.Ravichandran, M.Com ., M.B.A., M.A (Astrology)., M.Phil., Ph.d. , D.C.P., D.L.L & A.L., P.G.D.C.A., P.G.D.P.M & I.R., Associate Professor of Commerce, Commerce Research Centre, S.B.K.College , Aruppukottai . e-mail id : [email protected] Mobile: [phone] & 9080030090 TYPES OF CENTRAL EXCISE DUTIES

2. TYPES OF CENTRAL EXCISE DUTIES Basic Excise Duty (BED) Special Excise Duty (SED) Additional Excise Duty (AED) CESS National Calamity Contingent Duty (NCCD)

3. Basic Excise Duty  Excise Duty, imposed on all excisable goods other than salt produced (or) manufactured in India.  This duty is levied at the rates specified in the Schedule-I to Central Excise Tariff Act , 1985. Currently , the general rate of excise duty on non-petroleum products is 12%. This duty is applicable to majority of the excisable goods.

4. Special   Excise Duty  Some commodities like pan masala and cars have special excise duties levied on them. These items are covered under Schedule-II to the Central Excise Tariff Act, 1985.

5. Additional   Excise Duty Charged on goods listed in Schedule-III.  This tax is shared between the C entral and S tate Governments and charged instead of sales tax .  It is levied with the object to either curb the demand / consumption of a particular commodity (or) generate revenue resources from those commodities .

6. Education Cess  EC was levied on excisable goods manufactured in India @ 3% (2% EC and 1 % SHEC) of the aggregate duties of excise levied on such goods.  Education cess and SHEC leviable on excisable goods are fully exempted by Finance Act, 2015.  i.e ., No EC and SHEC shall be payable w.e.f . 1-3-2015 .

7. National Calamity Contingent Duty (NCCD)  It is imposed on pan masala, branded chewing tobaccos, cigarettes, domestic crude oil and mobile phones.  This rate is 1% on Basic Excise Duty.

8. Clean Energy cess A clean energy cess has been imposed w.e.f . 1-7-2010 on gross quantity of raw coal , lignite and treat raised and dispatched from a coal mine in India. The rate of duty is ` 50 per ton and it must be paid in cash.

9. GOODS For an item to be considered goods for the purpose of the levy of central excise duty, it must satisfy two requirements: 1.Movability Goods must be movable. Duty cannot be levied on immovable property. Central excise duty cannot imposed on plant and machinery. 2.Marketability Goods must be marketable. The goods must be known in the market and must be capable of being bought (or) sold.

10. As per Article 366(12) of the Constitution of India, “Goods” means all materials, commodities and articles.  Materials – wood, timber etc., used by the carpenters.  Commodities – chairs, tables etc., sold by the furniture dealers.  Articles – chairs, tables etc., used by a company in its administrative office.  It is not necessary that these can be seen, heard (or) smelled, but they are being capable of being felt is sufficient.  Accordingly the Gas, Steam and Electricity etc. also goods. GOODS

11. GOODS Excisable Non-Excisable Dutiable [including partly exempted ] Non Dutiabl e Nil D uty Fully E xemp ted Goods not specified in Tariff [i.e. CETA, 1985, I Schedule] Goods specified in Tariff, b ut rate of duty is blank

12. EXCISABLE GOODS  For the liability of duty of central excise to arise , the item in question should not only be goods, it should also be excisable goods .  Articles which are included in the Central Excise Tariff Act, 1985 (CETA) are called as Excisable goods.  i.e., G oods become excisable if and only if, it is mentioned in the Central Excise Tariff Act, 1985.

13. Non - excisable goods Non – excisable goods are those goods which have not been clearly mentioned in the CETA, 1985 before they are manufactured. i.e., - N o rate has been specified against any goods listed in the schedules then, such goods shall be non – excisable goods. For example, Live Animals, mentioned in chapter 1 of 1 st schedule to the Tariff, no duty has been specified against them.

14. Dutiable goods Dutiable goods mean excisable goods which have a rate of duty greater than 0%.

15. Non – dutiable goods Non–dutiable goods are those excisable goods not liable to duty of excise on account of:  1 . Rate of duty being ‘NIL’ in the Tariff schedule;  2 . On account of 100% exemption;  3 . On account of any other reason; i.e., not manufactured (or) not marketable.

16. Non – duty paid goods Non-duty paid goods are different from non-dutiable goods. Non-duty paid goods are those, which are removed clandestinely (i.e. secretly) without invoice , to evade duty.

17. Exempted goods Excisable goods do not become non – excisable after being fully exempted by notification. They continue to be listed in the schedules to the Tariff as being subject to a duty of excise.

18. Nil – rated goods Even goods with nil rate of duty, if find an entry in the schedules to the Tariff, are excisable goods , because nil rate is also a rate of duty. Goods with nil rate of duty cannot be treated as non – excisable.