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I have exceeded my SSI limit of 1.5 crores towards supply of semi-finished goods to my client and did not deposit the Excise Duty leviable on that extra clearance. But my client has deposited the entire Excise Duty applicable on that clearance without availing any CENVAT benefit. Though I am liable to pay the fine of Rs. 5000/- on each offence under the Excise Act, can they demand the entire Excise duty leviable on that clearance despite the fact that my client has already deposited the same? Can the Excise department demand double Excise Duty on the same clearance?
Free Member, Joined :02/05/2004
No of Topics Posted : 1
Reply/Comments : 1
The contribution of Small Scale Sector in the industrial growth of the Indian economy and to the Gross Domestic Product is significant. The Small Scale Sector has for itself a special dispensation in the Central Excise law in order to make it competitive in the domestic and global market. Central Excise duty concessions have been extended to the units in the small-scale sector based on their turnover so as to facilitate them to graduate by availing these concessions in a graded manner. Manufacturers of specified commodities having clearances not exceeding Rs. 3 crores in the preceding Financial Year are eligible for this exemption. Thus, this SSI can claim an exemption for clearance up to Rs. 3 crores
Hi Aparajita, I need clarity on this please - I was under the belief that for a turnover of 3 crores the exemption limit was granted on 1.5 crores of clearance of excisable goods during 2010-11. When the sale of Excisable goods exceeds 1.5 crores, excise duty was applicable. From your comment above it seems that clearance of excisable goods of 3 crores was exempt.
Secondly, My query regarding whether the Excise Dept can demand Double Excise Duty on the same clearance as per details above?
Free Member, Joined :02/05/2004
No of Topics Posted : 1
Reply/Comments : 1
Hi Mr.Sanjiv,
Thank you for the response.
The main principle is that there can be no double taxation on excise duty if there is cascading tax burden on the transaction.
Your client had paid excise duty without availing CENVAT benefit. You have also paid excise duty but without the extra clearance. So according to the above principle, this transaction has resulted in cascading effect as both parties have paid tax for the same goods.
Since the client's client has not availed CENVAT credit, he can claim refund for the same. However our client's liability may be different in that scenario.
Since your client has not availed CENVAT credit, he can claim refund for the same.
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