Budget 2011-2012 - Central Excise - Relief Measures:

5.1 Full exemption from excise duty has been provided in the following cases:  

. Air-conditioning equipment, panels and refrigeration panels for installation of cold-chain infrastructure for preservation, storage or transport of agricultural produce and apiary, horticultural, dairy, poultry, aquatic & marine produce and meat as well as processing thereof.;  

. Conveyor belt systems for use in cold storages and in mandis and warehouses for the storage of food grains and sugar  

. Goods required for the expansion of an existing mega/ ultra mega power project subject to specified conditions  

. Specified parts of sewing machines (other than those with inbuilt motors)  

. Parts of power tillers when cleared to another factory of the same manufacturer for manufacture of power tillers  

. Cotton stalk particle board  

. Enzymatic preparations for pre-tanning of leather  

. Colour, unexposed cinematographic film in jumbo rolls of 400 feet and 1000 feet  

. Pipe fittings required for a water supply project  

5.2 Concessional duty of 1% is being provided for the following:  

. Sanitary napkins, baby and clinical diapers and adult diapers  

. Water filters using pressurized tap water but no electricity and their replaceable kits  

5.3 Excise duty is being reduced from 10% to 5% on:  

. Kits for the conversion of fossil fuel vehicles into hybrid vehicles and parts of such kits  

. Grease proof paper and glassine paper  

. To prescribe that the process of repacking from bulk to retail packs, labeling or re labelling of containers or adoption of any other process to render the product marketable shall be a process amounting to manufacture through the insertion of a Chapter Note in  Chapter 22.  

. To prescribe that the process of conversion of ores into concentrates shall be a process amounting to manufacture through the insertion of a Chapter Note in Chapter 26.  

. To prescribe that the process of refining of gold dore bars shall be a process amounting to manufacture through the insertion of a Chapter Note in Chapter 71.  

. To prescribe that the process of galvanisation shall be a process amounting to manufacture through the insertion of a Chapter Note in Chapter 72.  

6.10 The First Schedule to the Central Excise Tariff Act (CETA) is also being amended to incorporate the latest editorial changes in the Harmonized System of Nomenclature (HSN). These changes will come into effect from 01.01.2012.  

6.11 Parts, components and assemblies of vehicles falling under chapter 87 excluding vehicles of headings 8712, 8713, 8715 and 8716 were notified under section 4A of the Central Excise Act with effect from 27.02.2010. Subsequently, parts, components and assemblies of certain vehicles falling under chapter 84 were also notified under these provisions with effect from 29.04.2010. However, these goods were not simultaneously included in the Third Schedule to the CETA. These are now being included in the Third Schedule retrospectively w.e.f. 27.02.2010 and 29.04.2010 respectively.  

6.12 Amendments are being made in the Schedule to the Additional Duties of Excise (Goods of Special Importance) Act, 1957 to remove sugar and textile and textile products from its purview. This would enable the State Governments to levy VAT on these items.  

6.13 According to Note 5 the repacking of perfumes from bulk packs to retail packs, labeling or re-labeling of containers is a process amounting to manufacture. In the case of traditional perfumes, commonly known as „Attar., this repacking is done at the point of retail sale to the customer in the retail shops. As a consequence, retail shops are required to obtain registration and comply with all the formalities of Central Excise law. The trade has represented that this poses a heavy compliance burden. Full exemption from excise duty has been provided to such goods when removed from retail shops after they are subjected to any of the process specified in the said Note provided that the manufacturer pays the duty on such goods when cleared in bulk from the factory on value representing the retail sale price. If the retail sale price is not required to be or not printed, then the value shall be the value at which such goods are sold in retail at a time nearest to the time of clearance from the factory. The notification also provides that the manufacturer shall observe the procedure specified by the jurisdictional Commissioner. (Notification No.18/2011-CE dated the 1st March, 2011 refers.)