Section 3 of Central Excise Act the ‘charging Section’ states that there shall be levied and collected duties on all excisable goods (excluding goods produced or manufactured in special economic zones) which are produced or manufactured in India. This definition of charging section of central Excise is vital, because it clearly signifies that there are four basic conditions for levy of Central Excise duty.
- The excise duty levied on goods;
- The goods must be excisable;
- The goods must be manufactured or produced; and
- The manufactured or production must be in India.
Levy and Liability of Excise duty The words ‘Levy’ means imposition of tax. Once a tax or duty is imposed, it has to be quantified (assessed) and then ‘collected’. Once a duty is levied, it has to be collected. It cannot be collected unless the duty is quantified (assessed). Hence, normally, ‘levy’ should cover ‘imposition’, ‘assessment’ and ‘collection’.
The following point should be kept in view regarding Levy of Excise Duty:
- Taxable event
- Person liable to pay excise duty
- The duty Liability in case of Ware house Goods
- Duty Liability in case of Job work
- Duty leviable on captive consumption
- Duty can be levied on Government undertaking
- Rate of duty as applicable on date of removal relevant
- State of goods at the time of removal is relevant
- Marketability is essential
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