Chetan Agrawal

Dear Sonika, excise duty can be levied only on the goods which are mentioned in Central Excise Traiff Act, 1985('CETA'). Since readymade garments and textile made-up are covered under chapter 61,62 and 63 of CETA therefore they are excisable and hence they are chageble to excise duty on their manufacture. However, till now duty is not required to be paid in relation to readymade garments because of a generel exemption notification no.30/2004-C.E dated 9th July 2004 which provides that no duty is required to be paid in respect of the readymade garments subject to the condition that Cenvat credit of the duty paid on inputs is not availed. But now this exemtion has been witdrawn in respect of the BRANDED readymade garments vide Notification No. 12/2011 –C.E. dated 1st March 2011. Further, notification no. 12/2011 –C.E. (N.T.) dated 24.3.2011 provides that declared the tariff value of the readymade garments and textile made-up to be 45% of the RSP. Thus duty is required to be paid @10.3% on 45% of the value of RSP declared. However, it is also important for you that there is an exemption notification for small scale manufaturers i.e. 8/2003 which provides exemption from excise duty on the clearence (sale) upto Rs.1.5 crore. Therefore, you are required to pay excise duty only if you are affixing any brandname on your product and your sale exceeds Rs. 1.5 crore. hope this is suffice. in case any more clarification is required please provide the detailed facts of yous case.