Page 72 - DCOM308_DCOM502_INDIRECT_TAX_LAWS

Unit 4: Various Authorities under Excise Law

Notes
GE, in answers provided through a spokeswoman, told us that it fully disclosed the
investment changes as well as the reason behind them. “We don’t think,” the company
went on, that the rule “allows too much discretion.”
But its top tax executive, John Samuels, said at a conference last year that the ability to
defer taxes on overseas profits gives companies an incentive to shift them abroad. It’s “a
heads-I-win, tails-I-break even situation,” Samuels said.
Question:

Analyse the case and Discuss the case facts

Source: http://features.blogs.fortune.cnn.com/2011/04/04/ges-taxes-a-case-study/
4.22 Summary

 Under section 3 of the Central Excises and Salt Act, 1944, the basic excise duty is charged on
all excisable goods other than salt.

 The goods must be produced or manufactured in India.
 The rates applied are as per the schedule to the Central Excise Tariff Act, 1985.
 Section 3 of Additional Duties of Excise (Goods of Special Importance) Act, 1957 states that
the levy and collection of additional excise duty is authorized with respect to the goods
mentioned in the schedule to the Act.
 This duty is charged in lieu of sales tax under different enactments like industries
development, medicinal and toilet preparations, sugar etc.
 The duty received is shared between the State and Central Governments.
 Special excise duty is attracted on all excisable goods on which Basic Excise Duty under the
Central Excises and Salt Act, 1944 is levied.
 This duty is charged as per the Section 37 of the Finance Act, 1978.
 Every year since then, the Finance Act specifies whether the duty is to be levied and
collected or not for that financial year.

4.23 Keywords

Manufacturer: Manufacturer is a person who actually manufactures or produces the excisable
goods.

Maximum Retail Price: MRP is the maximum retail price that shall be chargeable to final
consumers.
Personal Ledger Account: PLA is the current account prepared for keeping the account of duty
paid and duty payable.
Set-Off: Set-Off mean adjusting the duty paid on inputs with the duty payable on finished goods.
Tariff Value: Tariff Value is the value fixed by government from time to time for valuation of
certain excisable goods.
Trade Parlance Theory: The theory states that the goods must be classified in the CEA, in the
sense in which it is understood in the trade.

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