Central Excise Duty


Central Excise Duty comes under Indirect Tax which is paid by people to the manufacturer who pays it to the government. Taxation in India either charged by state government or by central government depending on the type of tax.

Central Excise Duty is study of:

  • Central Excise rules
  • Central Excise Tariff Act
  • Central Excise Act


The main objective of excise duty are:

  • Rates of Excise Duty
  • When and how excise duty is paid
  • Meaning and nature of Excise Duty
  • Valuation of goods for excise purpose
  • Clearance and Registration of goods

Excise Duty Chargeability

Central Excise Duty is levied on production of goods but it arises only on removal of goods. It arises on the removal of goods from the place of storage, i.e. factory or warehouse. If goods are marketable then excise duty is levied. Actual rate is not relevant . Therefore, central Excise Duty is liable for those goods which are given for free replacement during warranty period.

Rates of Excise Duty

Basic rate of central excise duty is 16%. While in some cases, special duty makes the excise duty 24%. At present, for education called education cess, which is 2% of the excise duty. So, the effective excise duty comes out as 16.32% or 24.48%.