Discount in bill, Central Excise

[Mridul Sethi]

Sir,

Pls let me clear that, for excise duty calculation is discount contant is considered or not. Actually we raise bill a party in the below manner.

Qty	100
Basic Price	161.54
Basic Value	16154.00
BED@10%	1615.40
Cess @ 3%	48.46
Total	17817.86
Less: Discount @ 1.65% on Basic Price	266.54
Balance Value	17551.32
Sales Tax @ 2%	351.03
Bill Value	17902.35

 

My query is that is always excise duty is charged irrespective of discount as shown in above calculation.i.e.can we not charge discount on Basic price & then do billing on balance amount. Pls clear it.

Posts / Replies

[SANJIV KOTHARI]

No, excise duty is leviable on Basic price only. Your calculation is in line with law.

 

Sanjiv

[Mridul Sethi]

Sir, can you plz give me the reference of Rule/Act in this regard.

[Pradeep Khatri]

Please refer circular no. 354/81/2000-TRU dated 30-06-2000 in this regard.  Further, also refer chapter 3 Part III Para 2.5 (iv) of CBE&C's manual, 2001.

[raj kumar shukla]

IF THE DISCOUNT IS A GENUINE TRADE DISCOUNT AND KNOWN TO THE CUSTOMER PRIOR TO REMOVAL OF GOODS AND ACTUALLY TRANFERRED O CUSTOMER, WHY CAN'T THIS BE ABATED FROM BASIC PRICE?

[raj kumar shukla]

PLEASE ALSO SEE PARA 2.5 (2) IV OF MANUAL OF SUPPLEMENTARY INSTRUCTIONS.

[gourav singhal]

sir you r absolutely right. discount will be charged after excise. but excise duty is charged on abattment value of MRP.