Please Help: Excise duty on amount of rent for scrap
Posted Date : 08-Sep-2011 , 03:31:58 pm | Posted By CA. Jainendra Sahu
whether excise duty on rent recieved by seller from the buyer of scrap material for non removal of scrap in period provided for the same should be payable or not? if yes then what % of exice duty is applicable?
Category : Excise | Answers : 1 | Comments : 2 | Hits : 557
Answers
Answer By: Ashish Karundia
Dear Friend,
If it is established to the satisfaction of the excise authorities that the rent received has nothing to do with the sale consideration of the waste (i.e. sale price of the waste was the only sale consideration (transaction value as per Section 4(1)(a) of Central Excise Act, 1944, then no excise duty will be paid on the same. However, this view may be contended by the department, in which case, the same needs to be litigated at the appropriate judicial forum.
Further, the rate of excise duty depends upon the classification of the product. Therefore, the same needs to be seen as per the Central Excise Tariff Act.
If it is established to the satisfaction of the excise authorities that the rent received has nothing to do with the sale consideration of the waste (i.e. sale price of the waste was the only sale consideration (transaction value as per Section 4(1)(a) of Central Excise Act, 1944, then no excise duty will be paid on the same. However, this view may be contended by the department, in which case, the same needs to be litigated at the appropriate judicial forum.
Further, the rate of excise duty depends upon the classification of the product. Therefore, the same needs to be seen as per the Central Excise Tariff Act.
Comments
CA VIPIN GARG
09-Sep-2011 , 08:55:22 amDear Sahu Ji, I don't think that there will be any excise duty on the above case as rent received is nothing to do with the manufacturing process and excise is leviable only when there is manufacturing of anything.....................
CA. Jainendra Sahu
10-Sep-2011 , 11:59:54 amThank you