duty calculation

[Dalia Felix]

we manufacture certain goods belonging to Chapter 16 of CETA. The goods are not seen in Third Schedule to CETA. An abatement of 35 % is declared in the abatement notification. the goods are packed and cleared in 'unit containers'. How the excise duty is to be calculated? based on MRP or on transaction value?

[PAWAN KUMAR]

Dear Sir,

Duty is to be calculated on MRP. As per your statement, there is an abatement of 35%. For example : If MRP is ₹ 100/-, Less abatement of 35% i.e. ₹ 35/-, Net assessable value would be ₹ 65/- on which duty is to be charged @ 12.36%.

[PAWAN KUMAR]

Dear Sir,

As you are manufacturing goods packing them in unit container. As per my view, both the options are available. If you are putting MRP on each container and it is your final price, then MRP based assessment will apply according to S.No.110 of Noti.No.49/2008-CE (NT) dt. 24.12.2008 as amended. This is irrelevant that your product is not under third schedule. The rate would be MRP - less abatement = assessable value of goods on which 6.18% rate of duty apply.

If you opt for transaction value of your unit container as final price, 6.18% of such value would be the rate of duty.

AI Summary

Excise Duty on Goods Under Chapter 16: Calculate Based on MRP with Abatement or 6.18% on Transaction Value A query was raised regarding the calculation of excise duty for goods manufactured under Chapter 16 of the Central Excise Tariff Act (CETA) that are not listed in the Third Schedule. With a declared abatement of 35%, the question was whether duty should be calculated based on the Maximum Retail Price (MRP) or transaction value. The response indicated that if MRP is marked on the unit containers as the final price, duty should be calculated on the MRP after abatement. Alternatively, if the transaction value is used as the final price, duty would be calculated at 6.18% of that value.