Charging Section of Excise

As per Section 3 of Central Excise Act,

There shall be levied and collected in such manner as may be prescribed,

 “A duty of excise on all excisable goods

(excluding goods produced or manufactured in special economic zones [SEZ])

which are produced or manufactured in India

and at the rates set forth in the First Schedule to the Central Excise Tariff Act, 1985”

Important Points

• Excise duty is charged only on GOODS and not on Services
• Goods must be EXCISABLE GOODS
• Excise duty is charged only on MANUFACTURE
• Manufacture must be in INDIA
• Rates of Excise are mentioned in First Schedule of CETA

Exam Questions

Q1

Examine whether central excise duty is leviable in the following situations:-

ABC Maintenance Services Ltd. provided maintenance services for refrigerators and airconditioners.

-a-

No. Excise duty is leviable on manufacture of excisable goods. However, activity of
maintenance of refrigerators and air conditioners is not 'manufacture' as it does not result
into emergence of a new article having different name, character or use. Thus, since the
activity is not manufacture, excise duty is not leviable on the same.

-ea-