Originally posted by : Rajat
	Originally posted by : preeti Can anyone plz post answer of Q -1 (d)-VAT calculation My answer (may be wrong) VAT Liablitty (4% on 15, 12% on 20, 4% on 10) = 3,40,000 VAT Input Credit = (4% on 20 & 12% on 20) = 3,20,000 Net VAT payable = 20,000   Inputer credit not allowed for exempt sales ... but credit allowed for inputs used in production of CG.

This answer is correct... but answer can be1,40,000/- VAT payable also... by not taking credit on input used in manufacturing of capital goods.... But in any case giving notes & assumptions should be advisable.

how abt 1b

For Q1e - I agree with Sriram

Cost of development to be excluded & cost of selling agent commission to be included for CIF and on that 1% landing cost to be added

AV = 5,60,613

Originally posted by : Rajat
	For Q1e - I agree with Sriram Cost of development to be excluded & cost of selling agent commission to be included for CIF and on that 1% landing cost to be added AV = 5,60,613

Yes your answer is absolutely right Rajat. AV = 5,60,613

Q1c - Taxable Value = 36,00,000 / tax = 92,700

Ans 1 b)

Own brand domestic clearance                                     120

Clearance for exports                                                    50

Clearance for Captive consumption                                40

                                                                                    210

Less: Basic exemption from duty                                   150

                                                                                      60

Add: Others branded goods manufactured in Urban

         Area (100-70)                                                      70

                                     Excise Duty Leviable value       130

                           Excise Duty on above @ 12.36%      16.068

Note : 1) Others branded goods have to be cleared by payment of duty

2) Clearance for export & captive consumption are not to be included only for calculation of SSI benefit of Rs 400 lakhs. So tax is levied on them as well.

3) Others branded goods manufactured I Rural area is exempt from levi of duty.

My Note : This answer is my own which I did in exam… I don’t know its correctness. I have a doubt whether clearance for export & captive consumption is eligible for slab deduction of 150 lakhs or not. But clearance of others branded goods should be cleared by payment of duty only… slab deduction of 150 lakhs is not available on those.

Originally posted by : Rajat
	Q1c - Taxable Value = 36,00,000 / tax = 92,700

@ Rajat : I think that 30 lakh is not to be included in AV as it becomes reverse charge as per Rule 2 (d) of ST Rules & taxable in the hands of consigner.... 

answer may be as follows... but I still have doubts about this answer...

Service to Unregisterd firm              600000

Composite Service                            200000

                       AV                                   800000 

Less: Abatement @ 75%                 600000          

                  Taxable Value                  200000

Service Tax @ 10.3%                         20600/-

Note : Clearing & forwarding agent services provided will not be taxed under GTA services..... Cenvat Credit is not available on GTA 72000/-............... Food grains are exempt unhder GTA.

Hey can anyone tell me if we write the judgement of the cases asked in the exam correctly without quoting the caselaw name .. hw many marks will be awarded... what is the usual marking scheme followed .. not just in idt but for all papers.. can anyone please....

Thank you.

Originally posted by : Lavanya V
	Hey can anyone tell me if we write the judgement of the cases asked in the exam correctly without quoting the caselaw name .. hw many marks will be awarded... what is the usual marking scheme followed .. not just in idt but for all papers.. can anyone please.... Thank you.

If you dont quote the case law name, it doesnt matter... maximum they can deduct 1 mark for it... But your answer should be exactly relating to the question asked.... For Ex: yeaterdays paper for that 'SIMCARD' problem if you write that Kerala High Court Judgement in Idea Mobile Communication, without quoting case law name, you will get 4 out of 5 for sure.

Originally posted by : Sriram
	Ans 1 b)     Own brand domestic clearance                                     120 Clearance for exports                                                    50 Clearance for Captive consumption                                40                                                                                     210 Less: Basic exemption from duty                                   150                                                                                       60 Add: Others branded goods manufactured in Urban          Area (100-70)                                                      70                                      Excise Duty Leviable value       130                              Excise Duty on above @ 12.36%      16.068   Note : 1) Others branded goods have to be cleared by payment of duty 2) Clearance for export & captive consumption are not to be included only for calculation of SSI benefit of Rs 400 lakhs. So tax is levied on them as well. 3) Others branded goods manufactured I Rural area is exempt from levi of duty.   My Note : This answer is my own which I did in exam… I don’t know its correctness. I have a doubt whether clearance for export & captive consumption is eligible for slab deduction of 150 lakhs or not. But clearance of others branded goods should be cleared by payment of duty only… slab deduction of 150 lakhs is not available on those.

Sirram... Initial clearance of 1.50 cr need to be calculated which will be 1.20 of own brand + 0.30 of other brand in rural area. So on this 1.50 cr exemption claimed

Value of clearance of export + exempted goods is alread exempt and to be ignored in calculation of 1.50 cr limit.

So eventually 70 lac of other brand name (urban) is to be taxed + Clearance for Captive Consumption i..e 40 lac

Either answer will be duty on only 70 lac  (captive exempt)

OR   answer will be duty on both i.e 110 lac (captive non exempt)

Personally, in my paper I have levied duty on captive consumption also since it is removed (cleared) from the factory and not consumed within the factory

Originally posted by : Sriram
	Ans 1 b)     Own brand domestic clearance                                     120 Clearance for exports                                                    50 Clearance for Captive consumption                                40                                                                                     210 Less: Basic exemption from duty                                   150                                                                                       60 Add: Others branded goods manufactured in Urban          Area (100-70)                                                      70                                      Excise Duty Leviable value       130                              Excise Duty on above @ 12.36%      16.068   Note : 1) Others branded goods have to be cleared by payment of duty 2) Clearance for export & captive consumption are not to be included only for calculation of SSI benefit of Rs 400 lakhs. So tax is levied on them as well. 3) Others branded goods manufactured I Rural area is exempt from levi of duty.   My Note : This answer is my own which I did in exam… I don’t know its correctness. I have a doubt whether clearance for export & captive consumption is eligible for slab deduction of 150 lakhs or not. But clearance of others branded goods should be cleared by payment of duty only… slab deduction of 150 lakhs is not available on those.

 I think exports sale and captive consumption are not to be considered for 150k clearance

Originally posted by : Sriram
	Originally posted by : Rajat Q1c - Taxable Value = 36,00,000 / tax = 92,700   @ Rajat : I think that 30 lakh is not to be included in AV as it becomes reverse charge as per Rule 2 (d) of ST Rules & taxable in the hands of consigner....  answer may be as follows... but I still have doubts about this answer... Service to Unregisterd firm              600000 Composite Service                            200000                        AV                                   800000  Less: Abatement @ 75%                 600000                             Taxable Value                  200000 Service Tax @ 10.3%                         20600/-   Note : Clearing & forwarding agent services provided will not be taxed under GTA services..... Cenvat Credit is not available on GTA 72000/-............... Food grains are exempt unhder GTA.

Yes Sriram u r right .. I made blunder. I was aware of Reverse Charge but in module in one problem they didnt mention registered/unregistered and took total freight as taxable service.. So based on that I thought GTA only pays service tax. Second mistake I made of exempting Composite Service & classifying it under the head of Cargo handling...bu hu hu hu full 5 marks gone.

Dear Raj,

The Captive consumption is not forming part of exemption of 400 lacs for SSI.

For VAT on capital Goods, The Input credit will be 50% for First yr of installation and balance in the subsequent year provided there is use and possession .Also the Depreciation cannot be claimed in the input tax availed on capital goods.

Regards,

C.P.Viswanathan

(CA final GRII)

Originally posted by : Viswanathan.C.P
	Dear Raj, The Captive consumption is not forming part of exemption of 400 lacs for SSI. For VAT on capital Goods, The Input credit will be 50% for First yr of installation and balance in the subsequent year provided there is use and possession .Also the Depreciation cannot be claimed in the input tax availed on capital goods.   Regards, C.P.Viswanathan (CA final GRII)

With due respect to your answer, Sir VAT as being a state subject is different from state to state... But in exam we have to do it as a whole for India... & as per the scheme of VAT a state can have its own rule... like either not giving Input credit on VAT at all, or giving full credit or as u said 50% in 1st year and so on... So as per me, u can do any of the solution, but should give appropiate not & assumption for your answer...

@ Rajat & James : You both may be right... I really dont know the exact provisions regarding this, & also the fact that till now I have not done or seen any Excise Duty audit, Practically also I dont have any kind of experience...