Calculation of 400 lakhs for readymade garments

[deepak gulati]

Respected Sir,

My Client is having turnover of ₹ 450lakhs in the previous year detail is as under :-

100 lakhs for unbranded garments having RSP < Rs. 1000 ;

150 lakhs having RSP >Rs. 1000/-;

100 lakhs having value is less than ₹ 1000 ;

100 lakhs branded and having value > ₹ 1000

450 lakhs

in the previous year

Please explain how to calculate turnover of ₹ 400 Lakhs for previous year.

[KASTURI SETHI]

Sh.Gulati Ji,

Point-wise reply is as under:-

(i) Not to be accounted for.

(ii) To be accounted for

(iii) Not to be accounted for

(iv) To be accounted for

You are eligible for the status of SSI on the basis of of your turnover in the preceding year.

[deepak gulati]

Thank-you kasturi ji.

If unbranded goods having RSP> 1000 whether the same will also counted .

Sir , please clarify for the current year, if last year's turnover is less than 400 lakhs

200 lakhs unbranded having RSP > 1000

100 lakhs Having branded goods > 1000

[KASTURI SETHI]

Sh.Gulati Ji,

While computing the turnover of ₹ 400 lakhs, the value of fully exempted goods are to be included/accounted for. While computing turnover of ₹ 1.50 crores, the value of fully exempted goods are not to be included. Only branded ready-made garments which have RSP of ₹ 1000/- and above are liable to Central Excise duty. For March, 16, the benefit of ₹ 12.50 lakhs in respect of ready made garments has been given. If the value for March, 16 is more than ₹ 12.50 that will be counted towards ₹ 4 crore.

[deepak gulati]

Thank you so much sir, i appreciate your views.

Sir Please clarify, whether selling of unbranded products having RSP >1000 /- into branded packing cover is included while calculating the limit of 1.50 crore?

[KASTURI SETHI]

Dear Sir,

By packing in branded cover means you are using brand name/trade name. CE duty has to be paid as no exemption is available.Duty paid goods are to be excluded for arriving at ₹ 1.50 crores.

[deepak gulati]

Thank you so much Kasturi Ji

AI Summary

Turnover calculation for ready-made garments: include fully exempt goods for higher threshold; exclude duty-paid branded goods for smaller threshold. Computation of turnover for ready-made garments requires including fully exempted goods when assessing the larger turnover threshold, while excluding fully exempted goods when assessing the smaller exemption threshold; unbranded low priced garments are not counted, unbranded and branded garments above the retail-price threshold are counted, and goods placed in branded packaging are treated as branded and liable to central excise with duty-paid goods excluded for the smaller threshold.