Industrial/Institutional sales

[RAJ KUMAR RAJKUMAR]

 Sir,

i am working for the cement Company. We have different Excise Structure Trade /Non trade. for Trade Parties. Mrp rate is appicable. ex rate 12%+ADV Rs.120/- P/Mt.

For Non trade Parties Excise duty on Transaction value is applicable. Here there is no  specfic duty will be appilicable.No. Rs.120/- Advalerm

Recently i have observed that our Marketing office is sending the material to some of the parties with the excise rate of Non trade.12% on transaction value.

for showing a party Trade /non trade what are points need to be observed. and its excise Notification No.

Have we to collect any declaration or certification from the party that they are insitution/Industrial

How to identify a party industrial/ Institutional/Mere trader.

Kindly gude me in this.

Regards,

[YAGAY andSUN]

While issuing Sale Order or receiving Purchase Orders to/from your potential customers, you may ask them, what would be the usage of Cement for them, whether Institutional or Re-Selling.  As there is no requirment to mention the MRP on the goods intended for the institutional purpose under Legal Meterology Act, therefore, by discussing or by obtaining the Undertaking you may get rid off, this requirement to mention MRP on the Institutional packagings.

AI Summary

Buyer classification as institutional or trade determines whether excise is charged on transaction value or under MRP rules. Classification of purchasers as institutional/industrial or trade/reseller controls whether cement sales follow an MRP based excise structure or are charged on transaction value. To apply institutional/non trade treatment, the seller should ascertain the buyer's intended use when placing or receiving orders and obtain a written undertaking confirming institutional status. The Legal Metrology Act does not require MRP marking on goods intended for institutional purposes, so documenting customer classification and obtaining undertakings supports applying non MRP institutional packaging and the transaction value excise approach.