MRP based duty on Computer peripherals

[CA Dinesh Kumar Agrawal]

The Central Government vide Notification No. 6/2008 C.E.(NT) dated 24.1.2008 has notified that provisions of clause (ii) of section 133 of the Finance Act, 2007 will come into effect from 25.1.2008. Clause (ii) of section 133 of Finance Act, 2007amends Third Schedule of the Central Excise Tariff Act.

In terms of Section 2(f)(iii) of the Central Excise Act,

(i) packing or repacking of goods in a unit container, or

(ii) labelling or re-labelling of containers including the declaration or alteration of retail sale price on it, or

(iii) adoption of any other treatment on the goods to render the product marketable to the consumer

in relation to goods notified under the Third Schedule of the Central Excise Tariff Act amounts to manufacture.

In view of the above, any of the aforesaid activity in relation to the following goods, which are mainly computer peripherals, will amount to manufacture and accordingly will be subjected to excise duty.

Further, the Government has also amended Notification No. 2/2006-C.E.(N.T.) dated the 1.3.2006, to include aforesaid goods w.e.f. 25.01.2008 in the list of notified goods and henceforth, these will be subject to excise duty on the basis of MRP declared on the package after allowing abatement as notified under Notification No. 5/2008 C.E.(NT) dated 24.1.2008.

In view of the above, goods as listed below will also be subject to levy of additional duty of customs (CVD) on MRP basis.

S/No	Tariff Heading	Description of goods	Rate of excise duty	Abatement rate
71A.	8443 31 00 or 8443 32	Printer, whether or not combined with the functions of copying or facsimile transmission	16%	25%
71B.	8443 32 60 or 8443 39 70	Facsimile machines	16%	25%
71C.	8443 99 51	Ink cartridges, with print head assembly	16%
"74A.	8471 30	Portable digital automatic data processing machines , weighing not more than 10 kg, consisting of at least a central processing unit, a keyboard and a display	12%*	25%
74B.	8471 60	Input or output units  whether or not containing storage units in the same housing including combined input or output units, Graphic printer, Plotter, other printers, Keyboard, Scanners, Mouse etc.	16%	22.5%
"81A.	8517 62 30	Modems (modulators-demodulators)	16%	25%
81B.	8517 69 60	Set top boxes for gaining access to internet	16%	24%
"92A.	8528	Monitors of a kind solely or principally used in an automatic data processing machine	16%	25%
92B.	8528 71 00	Set top boxes for television sets	16%	24%

*Notification No 6/2006 dated 1.3.2006