Excise On frieght insurance and packing

[jitendra pal]

Sir,

our Company is supplying hardware items to some state government electricity boards

where we have two seprate orders one is for ex works price + excise + cst or vat

and other order is for freight and insurance which is fixed and on average basis

please suggest if excise is applicable on fright and insurance amount also or not

AI Summary

Assessable value: freight and insurance included when delivery occurs beyond factory gate or are notionally charged.
Freight and insurance are excluded from assessable value when goods are sold ex-works and such charges are actually and separately borne by the buyer; they must be included where delivery occurs beyond the factory gate or where freight/insurance are charged notionally or included in the invoice price. Cenvat credit for service tax on freight/insurance is generally not available where the point of clearance is the factory gate and the buyer bears those charges; entitlement to credit depends on who pays and documentary proof of actual payment.