Excise duty payable on Sales tax paid at NPV value

[Asked by Guest]

Dear Sir, Is excise duty required to be paid on sales tax paid at concessional rate on Nov value, pls explain , pls give any reference regarding this, thanks and regards

[PAWAN KUMAR]

Dear Sir,

As per my view, no central excise duty is not payable on sales tax component.

[YAGAY and SUN]

Dear Sandesh,

Please check Maruti Suzuki judgment and Super Synotex pronounced by SC. In our opinion you would have to pay the Excise duty on such amount.

Regards,

YAGAY and SUN

(Management, Business and Indirect Tax Consultants)

[Mahir S]

Yes, and the said issue also clarified by the department.

[Santosh Mali]

Excise Duty need not be paid on NPV Calculated. As NPV is value which Assessee is has to pay to department.

But, Excise Duty liability may arise on Difference between Actual Sales Tax Liability and NPV.

As this is the value which have not paid or payable to Department and recovered the same from Customer.

As per Section 4 - closing line reads as --- "but does not include the amount of duty of excise, sales tax and other taxes, if any, actually paid or actually payable on such goods"

If Sales Tax department treat/ enact above difference as "Deemed Payment" in that case Excise Duty Liability may not arise.

AI Summary

Excise duty on sales tax component may arise where NPV is not treated as actually paid by the taxpayer.
Whether excise duty is payable on a sales tax component computed at Net Present Value (NPV) depends on whether that NPV is regarded as "actually paid or actually payable"; if treated as unpaid tax recovered from the customer or as a deemed payment by the sales tax authority, excise may be leviable on the difference between actual sales tax liability and the NPV, with the exclusion in Section 4 on taxes actually paid or payable being determinative.