Tariff value is fixed at
- 30% of transaction value in jewellery
- 60% of retail sales price in case of ready made garments
Example: 1
Suppose a manufacture makes ready made goods and sells them for 10 lacs.
Retail sales price of goods is 30 lacs
Rate of duty on these is 12.5%
Compute excise duty payable
View answer
Tarif value= 30% of retail sales price=30lacs x 30%=9 lacs
Excise duty payable=9 lacs x12.5%
=1.125 lacs
Example:2 Solve Ex.1 assuming it is a jewellery
View answer
Tarif value= 30% of transaction value=10 x 30%=3 lacs
Excise duty payable=3 lacs x12.5%
=0.375 lacs
Exam Questions
Question 9
Excise duty payable on cane molasses is Rs. 1,000 per ton. Excise duty on cane sugar is
12.5%. A manufacturer cleared 100 tons of cane molasses from his factory. He sold the cane
molasses @ Rs.15,000 per ton. Calculate the excise duty payable.
View answer
When excise duty is payable on the basis of a specific rate, the rate at which goods are
actually sold is immaterial. Therefore, since in this case, excise duty on cane molasses is
payable on the basis of tonnage (specific rate), rate at which they are sold is not relevant.
Thus, excise duty payable in this case will be Rs. 1,00,000 [Rs. 1,000 x 100 tons].