Central Excise-An overview- Manufacture, Excisability,Types of duty, Classification of goods

Central Excise is a type of tax imposed on goods manufactured and produced within a country. It is a form of indirect tax and is administered by the Central Government under the authority of Entry 84 of the Union List (List 1) under Seventh Schedule read with Articles 268 to 281 of the Constitution of India.

1. Manufacture: The term 'manufacture' implies any process or activity that brings about a change in an article or substance, resulting in a new and distinct object with a different name, character, and use. It is the process of producing goods from raw materials. In the context of Central Excise, the term 'manufacture' includes any process that is incidental or ancillary to the completion of a manufactured product.

2. Excisability: Excisability of a product is determined by its inclusion in the Central Excise Tariff Act, 1985. If a product is listed in this Act, it is excisable, and central excise duty is levied on its manufacture.

3. Types of Duty: There are mainly three types of duties under Central Excise.

   • Basic Excise Duty: It is charged under Section 3 of the Central Excises and Salt Act, 1944.
   • Additional Duty of Excise: This is charged under Additional Duties of Excise (Goods of Special Importance) Act, 1957 and Additional Duties of Excise (Textiles and Textile Articles) Act, 1978.
   • Special Excise Duty: As per Section 37 of the Finance Act, 1978, Special Excise Duty is levied on all excisable goods that come under taxation, in line with the Basic Excise Duty under the Central Excises and Salt Act, 1944.

4. Classification of Goods: The classification of goods for the purpose of Excise is done based on the Central Excise Tariff Act, 1985. This Act contains 20 sections, divided into 96 chapters that give a detailed classification of goods.

Remember, the purpose of the Central Excise duty is to levy and collect duties of excise on certain goods. The revenue collected is used for the development and welfare of the country.