Tooling Cost Amortisation, Central Excise

[Mayige Gowda]

Dear Friends,

I am proud to become a member TMI Family and I wish you everyone A Happy New Year in advance.

I have two queries on Tool Amortisation; 1) I will be amortising the Tool Cost as Cost Accountact certificate for the product manufactured out said tool. As per CA tool life is 50000 nos but Tool gets spoiled after completion of 10000 nos. Now whether I require to pay duty balance tool cost!!??

2) Secondly,  First I make the supplies to customer and after some months I realise the tooling cost from customer for the goods supplied earlier. In this senario how to treat the excise duty liability!!?

Thanks in advance for your valuable replies

Posts / Replies

[r.rajkumar kumar]

1.yes the balance duty is payable.total duty forthe tool less already amortized and balance tobe paid.

 

2.as per the p.o. from customer tools cost is payabale by the customer . hence amortisation of tool cost must charge from the begning. if your supplied with out amortisation now amortisation cost must charge for the earlier spplies and pay duty with interest. for the arrears.