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Infrastructure Cess applicability on manufactured goods

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Dated: 02/03/2016

Applicability of Infrastructure Cess as per the budgetary announcement on manufactured goods

 

Notification

No. 1/2016 – Infrastructure Cess

In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944) read with sub-clause (3) of clause 159 of the Finance Bill, 2016, which clause has, by virtue of the declaration made in the said Finance Bill under the Provisional Collection of Taxes Act, 1931 (16 of 1931), the force of law, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts excisable goods of the description specified in column (3) of the table below and falling under heading of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) specified in the corresponding entry in column (2) of the said table from so much of the Infrastructure Cess leviable thereon under sub-clause (1) of clause 159 of the said Finance Bill, as is in excess of the amount calculated at the rate specified in the corresponding entry in column (4) of the said table and subject to the relevant conditions annexed to this notification, if any, specified in the corresponding entry in column (5) of the table aforesaid:

Table

Sl. Heading Description of excisable goods Rate Condition
No.           No.
(1) (2)   (3)   (4) (5)
1 8703 Motor vehicles cleared as ambulances Nil
    duly  fitted  with  all  the  fitments,    
    furniture and accessories necessary for    
    an   ambulance   from   the   factory    
    manufacturing such motor vehicles    
2 8703 Motor   vehicles   (other   than   three Nil 1
    wheeled motor vehicles for transport    
    of  upto  seven  persons),  which  after    
    clearance has been registered for use    
    solely as ambulance      
3 8703 Motor   vehicles   (other   than   three Nil 1
    wheeled motor vehicles), which after    
    clearance has been registered for use    
    solely as taxi        
4 8703 Electrically operated vehicles, Nil
    including three wheeled electric motor    
    vehicles        
    Explanation.- For the purpose of this    
    entry, “electrically operated vehicles”    

 

    mean vehicles which are run solely on    
    electrical  energy  derived  from  an    
    external source or from one or more    
    electrical batteries fitted to such road    
    vehicles  and  shall  include  electric    
    motor-assisted cycle rickshaws driven    
    by  rechargeable  solar  batteries,  also    
    known as “soleckshaw”        
5 8703 Hybrid motor vehicles     Nil
    Explanation.- For the purpose of this    
    entry, “hybrid motor vehicle” means a    
    motor    vehicle,    which    uses    a    
    combination of   battery powered    
    electric   motor   and   an   internal    
    combustion   engine   to   power   the    
    vehicle to  drive  trains,  but does not    
    include   such   micro-hybrid   motor    
    vehicle with start and stop technology,    
    using battery powered electric motor    
    only while in static condition      
6 8703 Three wheeled vehicles     Nil
7 8703 Cars   for physically handicapped Nil 2
    persons          
8 8703 Hydrogen vehicles based on fuel cell Nil
    technology          
    Explanation.- For the purpose of this    
    entry,  “Hydrogen  vehicle”  means  a    
    motor   vehicle   that   converts   the    
    chemical   energy   of   hydrogen   to    
    mechanical energy by reacting    
    hydrogen with oxygen in a fuel cell to    
    run electric motor to power the vehicle    
    drive trains          
9 8703 Motor   vehicles   of    length   not 1%
    exceeding  4000  mm,  namely  petrol,    
    liquefied  petroleum  gases  (LPG)  or    
    compressed natural gas (CNG) driven    
    vehicles   of   engine   capacity   not    
    exceeding 1200 cc        
    Explanation.- For the purpose of this    
    entry,  the specification of the motor    
    vehicle shall be determined as per the    
    Motor  Vehicles  Act,  1988  (59  of    
    1988) and the rules made there under    
10 8703 Motor   vehicles   of    length   not 2.5%
    exceeding  4000  mm,  namely  diesel    
    driven vehicles of engine capacity not    

 

      exceeding 1500 cc    
      Explanation.- For the purpose of this    
      entry,  the specification of the motor    
      vehicle shall be determined as per the    
      Motor  Vehicles  Act,  1988  (59  of    
      1988) and the rules made there under    
      ANNEXURE
     
  Condition Conditions
  No.      
  1. (a) The manufacturer pays the Infrastructure Cess at the rate specified under  the Eleventh Schedule of the Finance Bill, 2016 read with exemption contained in any notification of the Government of India in the Ministry of Finance (Department of Revenue), at the time of clearance of the vehicle;
  • the manufacturer takes credit of the amount equal to the amount of Infrastructure Cess paid in excess of that specified under this exemption, in the Account Current, maintained in terms of Part V of the Excise Manual of Supplementary Instructions issued by the Central Board of Excise and Customs and thereafter files a claim for refund of the said amount of Infrastructure Cess before the expiry of six months from the date of payment of duty on the said motor vehicle, with the Deputy Commissioner of Central Excise or Assistant Commissioner of Central Excise, as the case may be, having jurisdiction, along with the following documents, namely:-
  • an intimation that the amount of refund of Infrastructure Cess claimed has been credited by the manufacturer in his Account Current, also stating the amount of credit so taken;
  • a certificate from an officer authorized by the concerned State Transport Authority, to the effect that the said motor vehicle has been registered for sole use as ambulance or taxi, as the case may be, within three months or such extended period not exceeding a further period of three months as the said Deputy Commissioner of Central Excise or Assistant Commissioner of Central Excise, as the case may be, may allow, from the date of clearance of the said motor vehicle from the factory of the manufacturer;
  • a copy of the document evidencing the payment of Infrastructure Cess, as payable in paragraph (a) above;
  • where the manufacturer has collected an amount, as representing the Infrastructure Cess, in excess of the Infrastructure Cess payable under this exemption from the buyer, an evidence to the effect that the said amount has been duly returned to the buyer; and
  • where the manufacturer has not collected an amount, as representing the Infrastructure Cess, in excess of the Infrastructure Cess payable under this exemption from the buyer, a declaration by the manufacturer to that effect;
  • the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, within seven days of the receipt ofthe said claim for refund, after such verification as may be necessary, shall determine the amount refundable to the manufacturer and shall intimate the same to the manufacturer. In case the credit taken by the manufacturer is in excess of the amount so determined, the manufacturer shall, within five days from the receipt of the said intimation, reverse the said excess credit from the said Account Current maintained by him. In case the credit availed is lesser than the amount of refund determined, the manufacturer shall be eligible to take credit of the balance amount; and

(d) the recovery of the credit availed irregularly or availed in excess of the amount of credit so determined, and not reversed by the manufacturer within the period specified under paragraph (c), shall be recovered as if it is a recovery of duty of excise erroneously refunded. In case, such irregular or excess credit is utilized for payment of duty of excise on clearance of excisable goods, the said goods shall be considered to have been cleared without payment of duty to the extent of utilization of such irregular or excess credit.

  • If,-an officer not below the rank of Deputy Secretary to the Government of India in the Department of Heavy Industries certifies that the said goods are capable of being used by the physically handicapped persons; and
  • the buyer of the car gives an affidavit that he shall not dispose of the car for a period of five years after its purchase. 

CEX Notfn 01

Source: CBEC, Min of Commerce, Govt. of India

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Email :         jha.sravi@gmail.com  

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