goods supplied to trust on charity.

[Anil Jangid]

please clarify whether we need to pay excise duty for goods supplied to charitable institutions at free of cost. The trust is registered and eligible for exemption under IT. Thanks in advance

AI Summary

Charitable trusts must pay excise duty on free goods; Rule 11 and Rule 8 require assessment at 110% cost. A query was raised regarding the obligation to pay excise duty on goods supplied free of cost to a registered charitable trust eligible for tax exemption. It was clarified that no exemption from Central Excise duty is available for such supplies, as outlined in several notifications, including Notification No.10/97-CE and subsequent amendments. Goods distributed as free samples must be assessed at 110% of the cost of manufacture according to Rule 11 and Rule 8. Another participant agreed with this explanation, confirming that excise duty is payable upon the removal of goods.