100% EOU, SAD 4% OR 2% CST, WHICH IS APPLICABLE IN DTA SALE., Central Excise

[SANJAY SURYAWANSHI]

Sir,

In 100% EOU, DTA sale, if Customer has given 'C' form, in this case SAD 4% (As per Customs Tariff Act 1975,Sub Sec 5 of Sec.3) is applicable or 2% CST against 'C' is applicable.

As per Customs Tariff Act 1975, 3(5), which ever is higher is applicable.

Please Clarify.

Posts / Replies

[Arun Kumar Singh]

If you have sale the inputs as it is then all duty will be applicable same. If you have cleared the goods after manufacturing of final product then only Excise and vat will be applicable.

[hikal ltd]

CST 2% only applicable as SAD is exempt once Sales Tax is Payable...

[SANJAY SURYAWANSHI]

Sir,

Thanks for reply.

In this case SAD is not exempt. Question is SAD 4 % is applicable or 2% CST against Form 'C', is applicable?

Regards,

Sanjay V.S.

[hikal ltd]

If you are paying CST 2% with C Form, then no need to pay SAD 4%, If sales tax is exempt then you have to pay SAD, current case you are paying Sales Tax, which is not exempt. Hence you mat pay only CST.

[SANJAY SURYAWANSHI]

But Section 3(5) of The Customs Tariff Act 1975 say which is higher to be paid. In this case 4% SAD is higher than 2% CST against 'C' Form.

[hikal ltd]

Please refer case law - 2014 (2) TMI 922 - CESTAT MUMBAI