Applicability of excise duty and cst towards price variation

This query is : Resolved

BALAJEE (Querist)
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16 March 2012 We (Larsen & Toubro Ltd) are executing a construction turnkey contractor for Karnataka goverment. Part of this contract,we have procured supply materials from various vendors and the price variation for such supply materials are applicable as part of the contract.

Now, while calculating price varition bills, our vendor has claimed with us the price variation amount of the materials including Excise duty and Central Sales tax. we have paid the same to our vendors. However, while we claim the price variation bill with our client, they donot accept the excise duty and CST amount.
kindly clarify whether excise duty and CST is applicable for the price variation bills.

SARATHY RP

SARATHY RP (Expert)
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31 May 2012 Excise Duty and CST is payable on the price variation. In fact there will be interest payment also in case of Excise Duty from the original clearance date till the differential duty is paid.