INDIRECT TAX LAWS & PRACTICE. Paper-18. Syllabus Set-1. Answer of Postal test Paper. Set-1.

Transcription

1 Paper-18 Syllabus-2016 Set-1 Answer of Postal test Paper Set-1

2 SECTION-A Q.1 B. i. 50% ii. CBEC iii. Receiver iv. Third Party Export v. 4% i. Form H ii. Gross Product Variant iii. Central Excise law 2002 iv. Supply of goods and service in return for provision of services C. i. True. The basic concept of CENVAT CREDIT is to avoid the cascading effect of duty. Cascading effect of duty (i.e. duty on duty) happens where excise duty is levied at every stage of manufacture. ii. False. Service means [Section 65B(44) w.e.f ] any activity for consideration carried out by a person for another and includes a declared service. But excludes: (a) IMAGE Immovable property Money Actionable claim Goods sold (including Deemed sale) Employee to the Employer (b) fees payable to a court or a tribunal iii. False. iv. True v. True. Assessment includes provisional assessment, self-assessment, re-assessment and any assessment in which the duty assessed is Nil [section 2(2) of Customs Act, 1962]. Q.2 The given statement is not valid: CENVAT credit not allowed in respect of exempted final products or final products on which duty paid is Nil and the goods in respect of which the benefit of an exemption under Notification No. 1/2011- CE, dated is availed i.e. goods on which 1% excise duty has been paid. B. The given statement is valid: As per Rule 2(1) of the Cenvat Credit Rules, 2004 (w.e.f ), input service includes services used in relation to setting up, modernization, renovation or repairs of a factory, premises of provider of output service or an office relating to such factory or premises. Input service used for repair or renovation of factory or office is available.

3 B. C. Service Tax Registration is required if the taxable turnover of the service provider during the previous year exceeds Rs 9 lakhs, or the service provider is acting as an input service distributor irrespective of his turnover. Service provider provided services under the brand name of another person. the service receiver is liable to pay service tax being recipient of service under Reverse Charge.

4 Q. 3 B. Q. 4 As per Section 13 of the Central Excise Act, 1944, only Central Excise Officers (CEOs) of the rank of Inspector of Central Excise and above may arrest after getting the prior approval of Commissioner of Central Excise. Central Excise Officer can arrest any person, whom he has reason to believe to be liable to punishment under Central Excise Act, 1944 or Rules B. (a) Authorisation and Customs Clearances for both imports and exports may be granted on self-declaration basis; (b) Fixation of Input Output Norms (SION) on priority by the Norms Committee i.e. within 60 days. (c) Exemption from compulsory negotiation of documents through banks. The remittance receipts, however, would continue to be received through banking channels by way of e-brc by DGFT.

5 (d) Exemption from furnishing of Bank Guarantee in Schemes under FTP. (e) Two Star Export Houses and above are permitted to establish export warehouses. (f) Three Star and above Export House shall be entitled to get benefit of Accredited Clients Programme (ACP) as per the guidelines of CBEC. (g) Status holders shall be entitled to export freely exportable items on free of cost basis for export promotion subject to an annual limit of Rs10 lakh or 2% of average annual export realization during preceding 3 licensing years, whichever is higher. (h) Manufacturer exporters who are also Status Holders shall be eligible to self-certify their goods as originating from India. C. Q.5 Aggregate sale price inclusive of CST = Rs 93,55,800 (i.e., 1,01,55,800 8,00,000) CST is Rs 1,83,447 (i.e. Rs 93,55,800 x 2/102) Note: 1. Excise duty forms part of sale price. Hence, it should not be deducted. 2. Incentive on sales received from manufacturer should not be deducted from sale price. 3. Deposit for returnable containers does not form part of sale price and hence, Rs 8 lakh has to be deducted from sales turnover. 4. Sales returns of Rs 87,550 should not be deducted from the sale price since the goods were returned after 6 months from the date of sale. B. Standard Input Output Norms or SION in short is standard norms which define the amount of input/inputs required to manufacture unit of output for export purpose. Input output norms are applicable for the products such as electronics, engineering, chemical, food products including fish and marine products, handicraft, plastic and leather products etc. SION is notified by DGFT in the Handbook, and is approved by its Boards of Directors. An application for modification of existing Standard Input-Output norms may be fi led by manufacturer exporter and merchant-exporter. The Directorate General of Foreign Trade (DGFT) from time to time issue notifications for fixation

6 or addition of SION for different export products. Fixation of Standard Input Output Norms facilitates issues of Advance License to the exporters of the items without any need for referring the same to the Headquarter office of DGFT on repeat basis. Q. 6

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