09 April 2017
Revati Industries has a factory at Lonavala and two branches at Vapi and Silvasa. The goods are produced at a cost of 170 per unit. The transport cost to Vapi is 35 per unit and to Silvasa are 30 per unit. Profit @20% on cost is added. During March 2015, quantity manufactured was 25000 units. Out of this 7500 units were sent to Vapi and 6500 units were sent to Silvasa. The sales during month were:- a) Lonavala 9000 units to Local customer Lonavala 2000 units to overseas buyer b) Vapi 6500 units to local customers c) silvasa 5500 units were captively consumed. Calculate excise duty payable @12.36%.
18 July 2024
To calculate the excise duty payable by Revati Industries, we need to determine the assessable value of goods manufactured at each location and then apply the excise duty rate of 12.36%.
Let's break down the calculation step-by-step:
### Step 1: Calculate the Manufacturing Cost per Unit Manufacturing Cost per Unit = Cost of production + Transport cost to respective branches - Cost of production per unit = ₹170 - Transport cost to Vapi per unit = ₹35 - Transport cost to Silvasa per unit = ₹30
**For goods sent to Vapi:** Manufacturing Cost per Unit to Vapi = ₹205
**For goods sent to Silvasa:** Manufacturing Cost per Unit to Silvasa == ₹200
### Step 2: Calculate Assessable Value Assessable Value is the value on which excise duty is calculated. It includes manufacturing cost plus any other charges up to the place of removal (factory gate in this case).
**For goods sent to Vapi (7500 units):** Total Assessable Value to Vapi = Manufacturing Cost per Unit to Vapi * Quantity sent to Vapi Total Assessable Value to Vapi = ₹1,537,500
**For goods sent to Silvasa (6500 units):** Total Assessable Value to Silvasa = Manufacturing Cost per Unit to Silvasa * Quantity sent to Silvasa Total Assessable Value to Silvasa = ₹1,300,000
**Excise Duty Payable on goods sent to Vapi:** Excise Duty to Vapi = Total Assessable Value to Vapi * Excise Duty Rate Excise Duty to Vapi = ₹190,071
**Excise Duty Payable on goods sent to Silvasa:** Excise Duty to Silvasa = Total Assessable Value to Silvasa * Excise Duty Rate Excise Duty to Silvasa = ₹160,680
### Step 4: Total Excise Duty Payable Total Excise Duty Payable = Excise Duty to Vapi + Excise Duty to Silvasa Total Excise Duty Payable = ₹350,751
Therefore, the excise duty payable by Revati Industries for the goods manufactured and sent to Vapi and Silvasa during March 2015 is ₹350,751 at the rate of 12.36%.
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