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07 - Excise For Dealers PDF
07 - Excise For Dealers PDF
07 - Excise For Dealers PDF
Lesson Objectives
On completion of this lesson, you will be able to understand
Excise duty or Duty of Excise is a tax on goods produced or manufactured in India and intended
for consumption in India. The Excise duty is levied at the time of production or manufacturing but
for convenience is collected at the time of removal.
It is an indirect tax on the manufacturer or producer which is passed on to the ultimate consumer.
The levy and collection of duty of Excise is provided under the authority of the Central Excise Act,
1944, at the rates specified under the Central Excise Tariff Act, 1985. The duty is commonly
referred to as the Basic Excise Duty. Certain items like fibre, yarn and so on also attract Additional
Excise Duty under the Additional Duties of Excise (Textiles and Textile Articles) Act, 1975.
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Registration of Dealers
Every Dealer or Importer issuing Cenvatable Invoices should be registered with the jurisdictional
Range Superintendent as per the procedure prescribed in Rule 9 of the Central Excise (No. 2)
Rules 2001. The registration is valid only for the premises for which it is granted. In cases where
the manufacturer or dealer, has more than one premise, it is necessary to obtain a separate regis-
tration for each premise.
The registration numbers are PAN based 15 digit alpha numeric. The first part denotes 10
character (alpha numeric) Permanent Account Number issued by Income tax authorities and the
second part comprises of a fixed 2 character alpha code which is as follows:
S.No. Category Code
1. Central Excise Manufacturers XM
2. Registered Dealers XD
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This is followed by three character numeric codes – 001, 002, 003, which denotes the number of
premises registered by the manufacturer or the dealer.
CENVAT Credit
A manufacturer or producer of final products is allowed to take tax credit known as CENVAT credit
on the following payments:
i. Duty of excise specified in the First and Second Schedule to the Excise Tariff Act (ED).
ii. Additional duty of Excise leviable under Additional Duties of Excise (Textile and Textile Articles)
(AED [T and TA]).
iii. Additional duty of Excise leviable under Additional Duties of Excise (Goods of Special Impor-
tance) (AED [GSI]).
iv. The National Calamity Contingent duty (NCCD) leviable under Finance Act.
v. Education Cess on excisable goods.
vi. Additional Duty leviable under Customs Tariff Act.
A manufacturer of excisable goods can avail of CENVAT credit for duty paid on the inputs
purchased and utilise the same for the payment of excise on any final product.
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Setup:
Go to Gateway of Tally of Monnet Ispat & Energy Ltd. and press F11: Features (Statutory &
Taxation Features).
Set Enable Dealer – Excise to Yes
Set Set/Alter Dealer Excise Details to Yes
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4. Unit Mailing Name: The Mailing Name entered in the company creation will be displayed as
the Unit Mailing Name. If required, it can be altered.
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Name entered in the Unit Mailing Name will be used in all Excise Reports.
5. Excise Registration (ECC) No.: Enter 15 digits Excise Registration Number (ECC) of the
Company/Unit, e.g. MIEBA3201RXD001
6. Date of Registration: Enter the date of Excise registration, e.g. 01-05-2001
7. Other Details: In this section enter Range, Division and Commissionerate details
Range: Enter the code Name and Address of the range under which your company is reg-
istered.
Code: Enter Range Code as 060372
Name: Enter Range Name as Yelanka II
Address: Enter the Range Address
Division: Enter the code Name and Address of the division under which your company is
registered.
Code: Enter Division Code as 0903
Name: Enter Division Name as Division II
Address: Enter the Division Address
Commissionerate: Enter the code Name and Address of the Commissionerate under
which your company is registered.
Code: Enter Commissionerate Code as 06
Name: Enter Commissionerate Name as Bangalore IV
Address: Enter the Commissionerate Address
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Specify the VAT TIN No., Inter-state Sales tax and Company’s PAN / Income – Tax No
details.
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The completed Excise Sales Voucher Type screen is displayed as shown below:
Step 1:
Go to Gateway of Tally > Accounts Info. > Ledgers > Create
1. Enter the Name of the Supplier in the Name field. E.g. Bhargavan Steels.
2. Select Sundry Creditors as the group name in the Under field.
3. Set Maintain Balances Bill by Bill to Yes and enter the Default Credit Period if any.
4. Set Inventory Values are affected to No
5. In the Mailing Details and Tax Information section enter the supplier contact details, Income
Tax and the Sales Tax numbers.
6. Enable Set/Alter VAT Details to Yes to display the VAT Details sub screen.
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The default type of purchases depends upon the status of the supplier,
whether he is a Manufacturer / First Stage Dealer / Importer / Second Stage
Dealer/ Agent of Manufacturer/Purchase from Importer.
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Ensure that the completed Sales – Excisable Goods ledger appears as shown below:
Inventory
Ledger Under Type of Duty/Tax VAT/Tax Class values are
affected
Input VAT @ 4% Duties & VAT Input VAT @ 4% No
Taxes
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Set/Alter Duty Details: Set this field to Yes to view the Duty Details screen.
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The following chart shows the flow of purchase and sales between the Manufacturer, Agent of
Manufacturer, First Stage Dealer or Second Stage Dealer and the passing of CENVAT Credit by
the Selling Dealer.
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The Excise Duty, Education Cess and Secondary Education Cess amounts are auto-
matically calculated on the basis of the configuration in the stock item master.
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14.In the Bill-wise Details screen, specify the Type of Ref as New Ref and type BS/101 in the
Name field.
15. Press Enter to accept the screen.
16.Type the details of the transaction in the Narration field.
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4. The dealer is required to issue only one invoice per consignment ,if all the packages in the con-
signment are despatched in one lot. However, in cases where the consignment is despatched
in batches either on the same day or different days or loaded on more than one vehicle, a sep-
arate invoice is made for each lot or consignment.
5. Each Cenvat Invoice issued by the location bears a printed serial number, beginning from the
1st of April of the year. The starting serial number as well as formats for recording the excise
can be easily intimated to the commissioner, whose jurisdiction the company falls. An acknowl-
edgement of such an intimation can be obtained.
6. Records and Invoice generated through computer are also recognised. The serial number
likely to be used in the forthcoming quarter should be intimated to the Assistant Commisioner.
A revised intimation is sent when the serial numbers are exhausted.
Setup:
Create a ledger – Output VAT @ 4%.
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18. Press Enter to accept the Voucher and print the Sales Invoice.
The default sales voucher type can be used for invoicing non-excisable
goods.
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2. Press F12: Configure (Invoice Printing Configuration) and Set the following to Yes.
Print Date and Time
Print Trader Supplier Info
Print Purchase Excise Duty details
Print Purchase Assessable Value
The completed Printing Configuration screen is displayed as shown below:
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The print preview of First Stage Dealer's Sales Invoice of Excisable Goods to a second stage
dealer is displayed as shown below:
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This Invoice displays the Excise details of the buyer, seller and manufacturer in accordance with
the Excise rules. It reveals the Item history, including the details of the purchases with their
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respective tariff and duties. This serves as an evidence for the passing of CENVAT Credit to the
subsequent dealer/ manufacturer.
It also specifies the manufacturer’s name, address and Excise details besides recording the date
and time of the removal of goods from the dealer’s premises. The Invoice is marked as the First
Stage Dealer, depicting the position of the selling dealer and has to be authenticated by the
authorised signatory in the relevant space provided in the document.
Go to Gateway of Tally > Display > Statutory Reports > Excise Reports > Dealer > Excise
Stock Register
Select Hot Rolled Coils and press Enter to display the stock register.
To print the Stock Register press Alt+P
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Go to Gateway of Tally > Display > Statutory Reports > Excise Reports > Dealer > Excise
Purchase Bill Register
In Selected Excise Unit screen
By default, Monnet Ispat & Energy Ltd appears in Name of Excise Unit field
Select Hot Rolled Coils from the List of Excise Stock Items and press Enter
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The Excise Purchase Bill Register of Monnet Ispat & Energy Ltd., is as shown.
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Go to Gateway of Tally > Display > Statutory Reports > Excise Reports > Dealer > Sales and
Purchase Extract
In the Sales and Purchase Extract printing screen,
Press Backspace and in Excise Unit field select Monnet Ispat & Energy Ltd. from the
List of Trader Excise Unit
Specify the From date as 1-4-2009 and To date as 30-4-2009
Specify Place and Date
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The printed Sales and Purchase Extract of Monnet Ispat & Energy Ltd. is as shown.
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Go to Gateway of Tally > Display > Statutory Reports > Excise Reports > Dealer > Form RG
23D > Select All Items to view Form RG 23D for all Items
In Selected Excise Unit screen
By default, Monnet Ispat & Energy Ltd appears in Name of Excise Unit field
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Sales Returns
On 25-4-09, Jaykanth Engineering returned Hot Rolled Coils, the details of which are as
given below:
Item Description Quantity Rate VAT
Hot Rolled Coils. 5 MT 600 4%
Setup :
In the F11: Features (Accounting Features),
Set Use Debit/Credit Notes to Yes
Set Use Invoice mode for Credit Notes to Yes
Set Use Invoice mode for Debit Notes to Yes
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Ensure that the completed Excise - Sales Returns Voucher Type appears as shown below:
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Select BS/101 as the Supplier Invoice No. from the List of Purchases.
Type the returned Quantity as 5 in the Quantity Return column.
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In the case of Debit Notes/ Credit Notes, the accounting and VAT ledgers
used earlier to account for purchases / sales entries, should be used in a
reverse order. This will reverse the effect of the sales/ purchase transaction.
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Go to Gateway of Tally > Display > Statutory Reports > Excise Reports > Dealer> Excise
Stock Register
The Excise Stock Register after the Sales Returns will appear as shown below:
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Practice Exercise
1. Jayanth Industries Pvt Ltd., dealing in cold rolled coils, has a bank account in SBI with an
opening balance of Rs. 800000.
Given below are the transactions for the month of May 2009. Create Jayanth Industries Pvt Ltd.
and pass the following transactions:
In the F11: Features (Statutory & Taxation Features), Enable Excise for
Dealers and VAT to Yes.
Create the following Voucher types and select/enter the fields as given in the table:
Name of Voucher Type of Abbr. Method of voucher Use for
Types Voucher Numbering
Dealer Excise
Excise - Purchases Purchase Ex - Purc Automatic Yes
Excise - Sales Sales Ex- sal Automatic Yes
Excise-Sales Returns Credit Note Ex-C/Note Automatic Yes
Create the following Ledgers in the masters and select/ enter the fields as given in the
table:
Name of the Ledger Under Maintain balances Excise
bill-by-bill Details
Vishveshwara Steel Industries Sundry Creditors Yes Yes
Ashok Engineers Sundry Debtors Yes Yes
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Create the following Ledgers in the masters and select/ enter the fields as given in the
table:
Name of the ledger Under Inventory Used in VAT/Tax
Values are VAT Class
affected Returns
Purchases - Excisable Goods Purchase Yes Yes Purchases @
Accounts 4%
Sales - Excisable Goods Sales Yes Yes Sales @ 4%
Accounts
Create the following Ledgers for VAT and enter the fields as given in the table below:
Name Of the ledger Under Type of VAT/Tax Class Inventory
Duty/Tax values are
affected
Input VAT @ 4% Duties & VAT Input VAT @ No
Taxes 4%
Output VAT @ 4% Duties & VAT Output VAT @ No
Taxes 4%
Create the following Units of Measure and enter the fields as given in the table below:
Type Symbol Formal Name Number of
Decimal Places
Simple MT Metric Tonnes 0
Create the following Stock Items and enter the fields as given in the table below:
Name Under Units Excise Details
Cold Rolled Coils Primary MT Yes
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Points to Remember
Excise duty is tax charged on goods manufactured and consumed
within India.
Goods to be Excisable must satisfy the three basic conditions i.e, it
must be movable, marketable and specified in the Central Excise Tariff
Act.
CENVAT Credit is the set-off of duty paid on inputs used in the manufac-
ture of final products, against the duty liability on such final products.
Only the registered dealers are eligible to pass on or avail as the case
may be the CENVAT Credit.
Tally.ERP 9 permits you to create specific voucher types like Excise-
Purchase & Excise-Sales for entering the excise related transactions.
Supplier/ Buyer details can be entered during invoice entry.
Tally.ERP 9 permits you to generate & print both Cenvatable & Non-
Cenvatable Sales Invoice.
A Registered Dealer is required to maintain Statutory Reports like Stock
Register of the cenvatable goods & Quarterly Return of the Excise Duty
paid. Tally.ERP 9 permits you to generate and print these Statutory
Reports.
Tally.ERP 9 also allows you to make adjustments in the records for the
sales return of Cenvatable goods and view its effect in the Statutory
Reports.
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