Transaction Value

[Krishan Gopal]

Dear Sir,Please advise, if the customer supply machinery free of cost under the rule 4(5) (b), would there any impact on calculating the transaction value of manufactured product.

AI Summary

Amortized Machinery Cost Must Be Included in Product's Excise Duty Value, Not VAT/CST, Per Central Excise Rules. A user inquired about the impact of customer-supplied machinery on the transaction value of a manufactured product under Central Excise rules. An expert advised that the value of such machinery should be amortized over its production capacity and included in the product's cost for excise duty calculations. However, VAT/CST should not include this amortized cost. The user further asked about invoicing methods, and the expert clarified that the amortized cost per piece must be included in the invoice's assessable value for Central Excise Duty, but VAT should not be applied to this cost.