Q. What is Taxable Event in Excise Duty?
Manufacturing is the taxable event in Excise Duty. Please note down the following line in Excise Duty act
"Any Taxable event for central excise duty is manufacture or production in India.
"As per our Institute book:‘Manufacture’ means :(a) Manufacture
as specified in various Court decisions i.e. new and identifiable product having a distinctive
name, character or use must emerge orOne which is define as manufacturing in Court Decision.
How to identify the same?
It will result in new identifiable product that have its own identity.
For example: If different spare parts of automobile are assembled to make a "Hero Bike", then here 'HERO BIKE' have its own identity therefore it amount to manufacturing.(b) Deemed Manufacture.
• Deemed manufacture is of two types –
(a) CETA specifies some processes as ‘amounting to manufacture’. If any of these processes are carried out,
goods will be said to be manufactured, even if as per Court decisions, the process may not amount to
‘manufacture’, [Section 2(f)(ii)].This will amount to manufacturing though it will not result in new identity. So, if CETA specifies the process as 'manufacturing', then with closed eye you will assume this process as manufacturing.
(b) In respect of goods specified in Third Schedule to Central Excise Act, repacking, re-labelling, putting or
altering retail sale price etc. will be ‘manufacture’. The goods included in Third Schedule of Central
Excise Act are same as those on which excise duty is payable u/s 4A on basis of MRP printed on the
package. [Section 2(f)(iii) w.e.f. 14-5-2003].Good specified in 'Third Schedule' of Central Excise Act will amount to manufacturing.