TaxTMI 
TaxTMI 
Ours is a snacks co. The Sales returns is almost 4% of our sale. Our Price list for our products keeps on changing atleast once in a month. We receive sales returns from our distributors. We value our stocks approximately since we do not have any record on which price it is sold. Is it right. Is there any case law.
Valuation of Sales Return
24 Jan 2011 
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Valuation of sales returns: adjust Cenvat credit and notify excise; remission possible for unmarketable goods, duty on removal.
Sales returns must be segregated, recorded in Form V and notified to the excise office; if not inspected the goods may be reconditioned. Cenvat credit taken on returned goods must be adjusted on removal: pay duty if resale is at a higher price, reverse credit if at a lower price. Unmarketable returned goods may qualify for remission of duty; replacements are treated as removals subject to excise duty, with duty payable at removal and VAT/CST not applicable. (AI Summary)
Sales returns must be segregated, recorded in Form V and notified to the excise office; if not inspected the goods may be reconditioned. Cenvat credit taken on returned goods must be adjusted on removal: pay duty if resale is at a higher price, reverse credit if at a lower price. Unmarketable returned goods may qualify for remission of duty; replacements are treated as removals subject to excise duty, with duty payable at removal and VAT/CST not applicable. (AI Summary)