TaxTMI 
TaxTMI 
An item was exempted from Excise when it was produced. When it was sentout of factory the central government withdraws the exemption. Whether excise duty will be payable on it or not?
Regards,
Mridul Sethi
Exempted Item
30 May 2012 
2 Replies 
1107 Views Asked by
Excise duty arises at the time of removal; withdrawal of exemption before clearance makes duty payable.
Taxability is determined at removal: if an item manufactured while exempt has its exemption withdrawn before clearance, excise duty is payable on removal because excise liability attaches to manufacture but is assessed and collected at the point of clearance. (AI Summary)
Taxability is determined at removal: if an item manufactured while exempt has its exemption withdrawn before clearance, excise duty is payable on removal because excise liability attaches to manufacture but is assessed and collected at the point of clearance. (AI Summary)