amortization cost is applicable on foc sale

[sagar shekhar]

dear sir,

i have send some part on FOC invoice to our customer can you please confirm amortization is applicable or not

[YAGAY andSUN]

Yes, it is applicable. Since Excise duty is on removal, not on sales of goods.

[PARTHASARATHY V]

When the Mould, Dies or other products provided to manufacture of agreed product, which will cover under the Valuation Rule 6 of 2006 ( which includes technical drawing, kowhow etc). Clearance made from supplier must suffer excise duty, whether it is for sale or FOC. Excise duty to be charged along with amortization cost for the goods cleared.

AI Summary

Amortization Costs Apply to Free-of-Charge Goods; Excise Duty Charged Under Valuation Rule 6 of 2006 A query was raised regarding the applicability of amortization costs on goods sent on a free-of-charge (FOC) basis. Two responses clarified that amortization costs are indeed applicable. The first response explained that excise duty is charged on the removal of goods, not their sale. The second response noted that when molds, dies, or other products are used in manufacturing, they fall under Valuation Rule 6 of 2006. Consequently, excise duty, along with amortization costs, must be charged on goods cleared, whether for sale or FOC.