Additional Excise duty on Hand-rolled cheroots with RSP less than Rs. 3/-
GOVERNMENT has imposed additional excise duty of 1.6% on hand-rolled cheroots with per cheroot retail sale price equivalent not exceeding Rs. 3. In this regard, S. No. 4A is inserted in Notification No. after S. No. 4.
S. No. 4 thereof pertains to ‘cigars and cheroots of tobacco' and S. No. 5 thereof pertains to ‘cigarillos of tobacco' which currently attracts an additional excise duty of 1.6% or Rs. 246 per thousand whichever is higher.
For this purpose, hand-rolled cheroots means “a tobacco product manufactured by manually rolling tobacco leaves wrapped in an outer covering of tobacco leaf without the aid of power or machine, with both ends cut flat.”
And the ‘Retail Sale Price' shall be defined as per ‘Explanation No. 1 to S. No. 18A'. In fact our frantic search to find out S. No. 18A in the Original Notification 6/2005-CE as amended did not yield fruitful results.
It appears the Board has copy-pasted this sentence from Column No. 3 of S. No. 32B of Notification No. Dated: April 29, 2010 which amended the Original Notification No. 3/2006-CE which actually contains S. No. 18A with Explanations numbered as 1 and 2, where Explanation No. 1 defines ‘retail sale price' and Explanation No. 2 gives an illustration of computing per-kg RSP.
As per this definition, “Retail sale price” means the maximum price at which the excisable goods in packaged form may be sold to the ultimate consumer and includes all taxes, local or otherwise, freight, transport charges, commission payable to dealers, and all charges towards advertisement, delivery, packing, forwarding and the like, as the case may be, and the price is sole consideration for such sale.
Now to incorporate the definition of ‘retail sale price' for the purpose of hand-rolled cheroots, the Board has to amend Notification 6/2005-CE as amended by this Notification Dated: April 29, 2010, to provide for a proper definition of ‘retail sale price' for hand-rolled cheroots.
In the absence of a specific definition in the relevant notification itself, there are chances of field formations going berserk by coming up their own definitions since the definition of ‘retail sale price' provided elsewhere in the Central Excise Act, 1944 or notifications issued there under are restrictively applicable to only those situations. For e.g. definition of Retail Sale Price in Section 4A is applicable only for the purpose of that Section.
We request the Board to amend the notification immediately.
Notification No. , Dated: April 29, 2010