This document outlines the central excise clearance procedure in India. It discusses that central excise duty is levied on goods manufactured in India for domestic consumption. There are two main types of assessment: self-assessment where the manufacturer declares and pays the duty, and assessment by a central excise officer. Goods can be cleared either with payment of duty, or without payment under a bond/letter of undertaking by providing proof of export within 6 months to claim rebate. The key steps involve applying for an ARE-1 form, sealing and examining goods, dispatching with copies to different authorities, and claiming rebate by providing shipping documents to bond authorities.

1. EXCISE CLEARANCE PROCEDURE
INTERNATIONAL TRADE
OPERATIONS

2. INTERNATIONAL TRADE
OPERATIONS
 A tax may be defined as a "pecuniary burden laid
upon individuals or property owners to support
the government, a payment exacted by legislative
authority. A tax is not a voluntary payment or
donation, but an enforced contribution.
 Direct Tax
 Indirect Tax

3. Direct Tax
 Is a kind of charge imposed directly on the tax
payer and paid directly to the government by the
person to the government.

4. Indirect Tax
 An indirect tax is a tax collected by an
intermediary (such as a retail store) from the
person who bears the ultimate economic burden
of the tax (such as the customer). An indirect tax
is one that can be shifted by the taxpayer to
someone else

5. Some Important Indirect Taxes
Imposed in India
 Customs Duty
 Central Excise Duty
 Service Tax
 Sales Tax
 Value Added Tax (VAT)
 Securities Transaction Tax (STT)

6. Central Excise Tax
 Central Government levies excise duty under the
Central Excise Act, 1944 and the Central Excise
Tariff Act, 1985. It is charged on such goods
which are manufactured in India and are meant
for domestic consumption.

7. Objectives of the Excise Duty
 Protect People
 Add Revenue
 Neutralize Subsidies

8. Procedure of registration for central
Excise
 Persons requiring Registration
 Application for registration
 Issue of certificate
 Validity of Registration

9. Assessment of Duty
Involves:
 Declaration of Quantity of Goods
 Value of Goods
 Applicable rates of Central Excise Duty in the
invoice.
 Rule 6, of Central Excise Rule 2002 authorizes
the assessee to assess the duty himself and this
is known as ‘self assessment Procedure’

10. Ways of Assessing the Duty
 Fixed
 Ad Valorem
 MRP Basis

11. Payment of Duty
 Duty for goods clearance should be paid by the
5th day of the following month but SSI units are
allowed to pay by 15th day. Duty is deposited in
cash or by cheque through TR6 challans in the
notified bank branches. Challan must indicate
registration number, classification of good.
 Bank keeps 1 copy for its records and returns two
(One for exporter and another to the range office
along with quarterly return.)

12. Clearance under Rebate Claim
 ‘Payment of Duty’ under Daily Stock Account.
However duty could be paid on monthly basis or
fortnightly.
 Special Permission for exports from other factory
or warehouse other than registered.
 Excisable goods shall be exported within six
months from the date on which they were cleared
for export from the factory of manufacturer. Date
to be mentioned on ARE-1.

13. Contd……
 Rebate claim admissible only if the rebate claim is
500 or more.
 Rebate claim for those excisable goods export of
which is prohibited is not admissable.

14. Application for Remission of Excise
(ARE-1)
 ARE-1 is prescribed by Central Board of Excise
and Customs as a document for excise
clearance.
 Running Serial Number
 Prepared in quintuplicate

15. Procedure
 Sealing of Goods and Examination at the place of
dispatch
 Dispatch of Goods by Self Sealing and Self
Certification

16. Sealing of Goods and Examination
at the place of dispatch
Copies Colour Submitted to
Original White Superintendent/
inspector of C.E. shall
return it to the exporter
after endorsement
Duplicate Buff Superintendent/
inspector of C.E. shall
return it to the exporter
after endorsement
Triplicate Pink To officer with whom
rebate is to be claimed
Quadruplicate Green Retained for official
records
Quintuplicate Blue Export Promotion
Council

17. Dispatch of Goods by Self Sealing and
Self Certification
Copies Submitted to Further Action
Original Sent to the place of
export along with goods
Duplicate Sent to the place of
export along with goods
Triplicate To the Superintendent
within 24 hours of
removal
To the officer from
whom rebate is to be
claimed
Quadruplicate To the Superintendent
within 24 hours of
removal
For records
Quintuplicate Export Promotion
Council

18. Examination of goods at the place of
exports
 Original duplicate copy of ARE-1 to be presented
along with the goods
 Customs examine and cite shipping bill number
 Return the original copy to exporter
 and duplicate copy to rebate claim office

19. Clearance Without Payment of
Duty
 Exporter- furnish Bond and obtain Certificate
(Security or Surety with Bond)
 Manufacturer Exporter- Letter of Undertaking (For
exporter with good record), no certificate is
required. However compliance with ‘acceptance
to proof of export’ and other terms and condition
is expected. This is Bond with nil security.

20. Contd……..
 Manufacturer Exporter- LUT + Invoice
 Merchant Exporter- Bond certificate + Invoice (as
proof of export)
 Certificate of Bond
 For 1-3 month depending on the track record of the
company
 Description of goods from a particular factory/ warehouse
 Duty involved (calculated on transacted value and duty rate)
 Ensure that at the time (period of 7 days from the time of
removal) of debit sufficient credit is available to cover it

21. Contd……..
 Shall record the clearance in his account as ‘duty payable
but forgone under rule 19’.

22. Procedure
 Sealing of Goods and examination at the place of
dispatch
 Dispatch of goods by self sealing and self
certification

23. Sealing of Goods and Examination
at the place of dispatch
Copies Colour Submitted to
Original White Superintendent/
inspector of C.E. shall
return it to the exporter
after endorsement
Duplicate Buff Superintendent/
inspector of C.E. shall
return it to the exporter
after endorsement
Triplicate Pink To officer with whom
rebate is to be claimed
Quadruplicate Green Retained for official
records
Quintuplicate Blue Export Promotion
Council

24. Dispatch of Goods by Self Sealing and
Self Certification
Copies Submitted to Further Action
Original Sent to the place of
export along with goods
Duplicate Sent to the place of
export along with goods
Triplicate To the Superintendent
within 24 hours of
removal
To the bond accepting
authority
Quadruplicate To the Superintendent
within 24 hours of
removal
To the officer from
whom rebate is to be
claimed
Quintuplicate Export Promotion
Council

25. Re- Credit Against Proof
 Original ARE-1
 Shipping Bill
 Bill of Lading
To bond accepting authorities and credit would be
availed.
Non export within 6 months attracts payment of
duty and high interest rates.

26.  THANK YOU!!!
 Chandan Singh