Rate of Excise duty in case of Supplimentary Invoice
We are supplying the automobiles parts to an automobiles co. we had supplied some parts during the time of Jan- 2012 to March-2012, now automobile company has increased & amended the purchase order retrospectively the price of our parts supplied to them from our co.
Now, we have to raise the supplementary invoice due to the rate revision for duty difference but, the rate of excise duty has been change from 10% to 12% from 17.03.2012., So if today, I want to raise the Excise invoice what should be the rate of Excise duty i.e 10 or 12%.
Pls. give your opinion on the issue with supporting rules, regulation, case law etc.
Posts / Replies
Rate of duty would be rate prevailing at the time of clearance of excisable goods.it would be 10% in your case. see rule 5 of central excise rules.pl note that at the time of issuing supplementary invoices, no goods are being cleared.
You may have to pay the interest while raising the Supplementory invoice.
Yes. Rule 5 of Central Excise Rule, 2002 is the governing rule and accordingly, you should pay duty @ 10.3% along with interest from the due date till the date of payment. Your customer can take credit of the duty paid by you in terms of Rule 9 of Cenvat Credit Rule, 2004 wherein supplementary invoice is a prescribed document to avail the credit.
Rate of duty at the time of removal of good is relevent i e clearance from factory.You may refer the Supreme court judgement in Wallace Flour Mills com ltd vs CCE (1989 (9) TMI 106 - SUPREME COURT OF INDIA)=44 ELT598C also confirmed in Newman Press case .
In the above case the rate at the time of removal was 10% .Any retrospective amendment in PO does not change the dare of removal .Hence rate will be 10% on supplies relating prior to 17.3.2012 .In my view you should raise supplementry bills immediately on issue of amendment by OEM so that liability is discharged before the due date i e up to 5th of next month and no interest shall be leviable on the same