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Excise duty at point of sale: SC

Excise duty is normally charged at the factory gate when the goods are taken out. However, it need not always be so. The sale can take place at the buyer's premises. Therefore, the duty can be charged there. The test is the point where the sale takes place, the Supreme Court ruled in the case, Commissioner of Excise vs Roofit Industries Ltd. The revenue authorities alleged that the company was evading duty by not computing the value of finished goods and it was deducting the amount of freight, insurance and unloading charges from the price of excisable goods though the place of removal of finished goods was not factory gate but the buyer's premises. The firm challenged the demand of duty before the excise appellate tribunal. It allowed its petition which led to the appeal before Supreme Court. Allowing the appeal, Supreme Court stated that "it is to be seen at what point of time the sale is effected, namely whether it is at the factory gate or later, that is, when the delivery of goods is effected to the buyer at his premises. This aspect must be seen in the light of the provisions of the Sale of Goods Act."

Article referred: http://www.business-standard.com/article/opinion/excise-duty-at-point-of-sale-sc-115050300727_1.html

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