dispatch of excisable goods

[Guest]

Dear Sir,

Can we remove the excisable goods from the factory on the Next day of the invoice date( In that case the date and time of removal on the invoice will be shown as actual date of dispatch).Is there any compulsion in the excise Law to remove the goods on the same day invoice is made.

e.g

goods are invoiced on 26/09/11 . The stock is redueced accordingly in the computerised system.

Goods are physically dispatched on 27/09/11 with the date and time of removal shown in the invoice as 27/09/11 and date of preparation is shown as 26/09/11

[Arun Kumar Singh]

Yes, you can remove the goods next date after preparation of invoice.

[Guest]

Dear sir

1. another doubt on this issue, if the goods are invoiced on end of the month say 31st march and physical movement can be done on 1st April

2. If the goods are invoiced on 2nd April can we move the goods physically after two days I:e on 5th April.

Please clarify me on these two cases in depth

Regards

Vijayaraghavan T G

[Rajagopalan Ranganathan]

Sir,

Now duty is paid on 5th (for other mode of payments) or on 6th (for payment through electronic mode) you need not worry about the removal goods immediately after preparation of Invoice. Under old provisions duty payable is to be debited in PLA or Credit Account before removal of the goods. Now this condition for removal goods is not there in the statute. Therefore you have to remove the goods within reasonable time from the time of preparation of invoice. If invoice is prepared on 26.09.11 the removal should take place before 24 hrs on 26.9.2011. If you remove the goods on 27.9.2011 it is advisable to cancel the invoice dated 26.9.2011 and prepare a fresh invoice.

Regarding removal goods on 31st March, the only condition as per rule 8 of Central Excise Rules, 2002 is that the duty should be pa on 31st March itself. Now duty paid goods can be retained inside the factory the removal can be made on 1st April.

In my opinion if you are sure that the excisable goods will be removed on certain day then you prepare the invoice. Otherwise prepare the invoice on the day in which all arrangements like availability of transpor etc., are made to remove the excisable goods.

[Mahir S]

Sir,

For all clearances effected in the month of March, the duty has to be paid on 31st March. Hence, it is advised that the physical movement for goods invoiced on end of the month say 31st March should not be done on 1st April i.e. in next financial year.

For goods invoiced on 2nd April and to be removed on 5th April - It would be advisable to cancel the invoice and issue a new invoice on 5th April, with due intimation to the excise department.

The above submission is based on assumption of the law.

Also refer to Issue Id : - 107250 dated : - 28-08-2014 on the said topic.

[YAGAY andSUN]

Dear Vijaya,

Invoices are primary and statutory documents through which goods are removed for following purposes, viz:-

1. Sale
2. Samples
3. Stock Transfers
4. Free Supplies
5. Rejection etc.

Invoices are required to prepare under following statutory laws, Acts, Rules, provision etc, viz:-

1. Central Excise
2. Customs (Import Export)
3. VAT/CST/Entry Tax
4. Service Tax (Finance Act, 1994)

Except Finance Act, 1994, under other legislatures after putting the time and date of removal on invoice, should be removed within 1 hours, otherwise department may doubt that on the same invoice goods are being removed again and again. Such kind of non compliance has been booked as offense under the legislatures as mentioned in above point no from 1 to 3. Extended time can be availed under the provisions of respective legislatures due to non availability of transport, violence, curfew and strikes etc.

Regards,

YAGAY and SUN

(Management and Indirect Tax Consultants)

AI Summary

Invoice timing and removal of excisable goods: post-invoice dispatch permitted subject to duty-payment timings and reissued invoices when delayed. Goods may be dispatched after invoice preparation provided duty-payment and documentary requirements are observed; the previous obligation to debit duty accounts before removal has been relaxed but removals should occur within a reasonable time and invoices should be cancelled and reissued if the actual dispatch date differs materially. Special caution applies at the fiscal-year end because duty for clearances in the last day of the year must be paid then; while duty-paid goods may remain in the factory, physical movement that crosses the year-end requires careful compliance. Invoicing is a primary statutory record and some regimes expect removal shortly after the invoiced removal time, with relief for disruptions.