Types of Duties - Central Excise Practice Manual (OLD) - Central Excise

Chapter No. 02 Types of Duties (Central Excise) In Central Excise the following type of duties are levied and collected: 1 Basic Excise Duty (Called as CENVAT) Basic duty of excise (also called as CENVAT) is levied at the rates specified in First Schedule to Central Excise Tariff Act, 1985 (CETA). The rate of excise duty mentioned in the CETA is subject of various exemption notifications in this regard if any. General Rate of Excise duty is 12.5%. But the rate of duty may vary from product to product. (Central Excise First Schedule - Basic Excise Duty with Section Notes , Chapter Notes ) ( General Effective notifications ) ( Category wise effective notifications ) 2 Special Duty of Excise Special Excise duty (SED) is levied at the rates specified in Second Schedule to the Central Excise Tariff Act, 1985 (CETA). This duty is imposed on few selected items like Pan Masala, Polyester Filament Yarn, Motor Cars, Air conditioners, tyres, etc. On some products special excise duty is imposed at 8% and on certain other products it is levied at different rates. This duty is in addition to basic excise duty. However, notification no. 9/2006 CE dated 1/3/2006 exempts all goods falling under second schedule from the whole of special excise duty. In most of the cases the special excise duty has been merged with basic excise duty. 3 National Calamity Contingent Duty (NCCD) National calamity contingent duty (NCCD) is imposed under the provisions of Finance Act. It was first imposed vide section 136 of Finance Act, 2001. Only few items are subject to NCCD. Pan masala, Cigarettes, Hookah or gudaku tobacco, various varities of Jarda or tobacco, petroleum oil, polyester yarn, Certain passenger vehicles etc. are subject to NCCD. (Schedule of NCCD) (Effective notifications in respect of NCCD) 4 Additional Duty of Goods of Special Importance This duty is leviable under Additional Duties of of Excise (Goods of Special Importance) Act, 1957. In most of the cases the duties of Goods of Special Importance has been merged with the basic excise duty. Therefore, notification 11/2006 CE dated 1/3/2006 provides full exemption from the additional duties of goods of special importance. (Schedule of goods of Special Importance) (Effective Notifications in respect of goods of special importance) 5 Additional Duty of Textile and Textile Articles Additional excise duty on certain textile and textile articles is levied under Additional duties of Excise (Textiles and Textile Articles) Act, 1978. This duty is chargeable on the amount of excise duty chargeable under Central Excise Act, 1944. Notification no. 31/2004 CE dated 9-7-2004 exempts all goods from levy of additional duties of textile and textile articles. (Schedule of Additional duties of textile and textile articles) (Effective notifications in respect of textile an textile articles) 6 Additional Duty of Excise on Mineral Produces Additional duties of excise on Mineral Products are levied under Mineral Products (Additional Duties of Excise and Customs) Act, 1958. 7 Additional Duty of Excise on Medical and Toilet Preparation Additional duties of excise on Medical and Toilet Preparation is levied under Medical and Toilet Preparation (Excise Duties) Act, 1955. 8 Additional Duty of Excise (Surcharge) Finance Act, 2005 has imposed an Additional Duty on pan masala and tobacco products under section 85 of the Act. This additional duty is also called as 'Surcharge'. This duty is payable @10% of the aggregate of normal rate of excise duties payable. In certain cases the surcharge is specific. (Schedule of Surcharge) (Effective rate of surcharge) 9 Clean Energy Cess A Clean Energy Cess has been imposed w.e.f. 1.7.2010 vide section 83 of Finance Act, 2010 on gross quantity of raw coal, lignite and peat raised and despatched from a coal mine in India. This cess would be levied and collected as a duty of excise from coal mines. This cess would apply to imported coal as CVD. Tariff rate is ₹ 100 but effective duty is ₹ 50 per ton. Education Cess and Secondary Higher Education Cess is not payable on this cess. Any CENVAT Credit cannot be utilised for paying this cess. This will be payable only in cash. 10 Education Cess and Secondary Higher education cess Exemption from cess (EC + SHEC) on all excisable goods vide notification no. 14/2015- CE and 15/2015 CE ,dated 01-3-2015 11 Other Cess There are various types of cesses are levied under various statutory provisions for meeting out the different purposes. The difference between the duty and cess is that duty is for general purpose and revenue collected from duties can be utilized anywhere whereas the cess is imposed for specific purpose. Amount collected from cess is used for the specific purpose only. (Schedules of other Cess levied)