Removal of Inputs/Capital Goods without having put the same into use (production) is referred to as Removal as Such.
Sometimes, Inputs/Capital Goods purchased by the manufacturer for the manufacture of Final Product can be sold/disposed if,
The input/capital goods are not required by the manufacturer
The prospective is willing to pay more
Excess Supply
Change in Production plan
Inputs or Capital Goods can be removed from factory of manufacturer on payment of Duty at the rate applicable on such goods on the date of removal.
Tally.ERP 9 allows to record the Removal as Such transactions and captures the details of credit adjusted against the duty paid on removal of goods in appropriate reports and Form ER- 1.
Example: on 15-8-2008 ABC Company removed (as such) following inputs by paying Excise Duty @ 16% along with Education Cess @ 2% and Secondary Education Cess @ 1% to sell to Lanco Manufacturers
* Pet Bottles - 2Ltr 25000 nos @ Rs.4 per bottle
* Water Container - 20Ltr 3000 nos @ Rs. 9 per container
Go to Gateway of Tally > Accounting Vouchers > F8: Sales
In Voucher Type sub form select Excise – Sales as the voucher type.
Ensure that the Sales Voucher is in Item Invoice Mode.
Note: In Tally.ERP 9 Excise Sales Transactions needs to recorded in Invoice Mode Only.
Enter the Date as 15-8-2008.
Enter the Ref details as ABC/941.
In Excise Unit field Tally.ERP 9 displays ABC Company, as selected during voucher type creation.
Excise Book Name field displays the name of the excise invoice book (ABC/Rule11/Book1/08-09) created for the Excise Unit.
Serial No. field displays the Rule 11 invoice Number e.g. ABC/1012/08-09.
In Party A/c Name field select Lanco Manufacturers from the List of Ledger Accounts.
In Party Details sub form.
Despatch/Order Details: Under these two sections enter the Despatch and Order Details.
Sl.No. in PLA /RG-23: In this field enter the Sl.No. in PLA /RG-23 register as 1.
Date & Time of Invoice: In this field enter the time Date of Invoice. Tally.ERP 9 by default displays the system time and date in this field which can be changed.
Date & Time of Removal: In this field enter the Time & Date of Removal of Goods. Tally.ERP 9 by default displays the system time and date in this field which can be changed.
Note: As per Central Excise Invoice System, in all the sales invoices, the time and date of removal has to be printed.
Buyer Details: In this section Tally.ERP 9 by default displays the details provided during buyer ledger creation, which can be changed.
In Nature of Removal field select the option Removal As Such from the list of Types of Removals.
Note: It is must to define the nature of removal in Rule 11 Invoice.
* Removal as Such is selected when the inputs/capital goods are removed as such.
In Sales Ledger field select the ledger Sales @ 12.5% from the List of Ledger Accounts.
VAT/Tax Class field automatically gets updated with the VAT/Tax class as selected in the sales ledger, which can be changed.
In Name of Item field select the Stock Item i.e. Pet Bottles - 2Ltr.
In Quantity field enter the quantity as 25,000.
In Rate field enter the rate as Rs. 4.
Amount will be displayed automatically.
Similarly, select Water Container - 20 Ltrs, specify Quantity as 3000 and Rate of Rs. 9
Select Duty Ledger i.e. Basic Excise Duty @ 16% and press enter to view Excise Duty Allocation screen
In Excise Duty Allocation screen
In Type of Ref field New Ref is defaulted
In Name field the combination Excise Book Name and Serial Number details will be captured and displayed automatically. Tally.ERP9 does not allow you to alter the Name details.
Name Item: This field displays all the stock items which are selected in the sales voucher type
Assessable Amount: This displays the item wise Assessable Value on which the duty is calculated
Rate: Rate of duty defined in the duty ledger will be defaulted. If the duty paid is at higher or lower rate than the rate defined in the ledger, same can be altered in Rate field.
Duty Amount: Duty Amount will be calculated on the Assessable Value at the rate specified.
Duty calculated in the Excise Duty Allocation screen will be displayed automatically in Amount field.
Select Education Cess @ 2% and press enter to view the Excise Duty Allocation screen.
Note: Basic Excise Duty amount will be displayed in Assessable Value field
Similarly, select Secondary Education Cess @ 1% and accept the default details displayed in Excise Duty Allocation screen.
Select Output VAT @ 4% as the Vat duty ledger. Amount will be displayed automatically.
Set the option Show Statutory Details to Yes to view Statutory Details screen.
In the Statutory Details screen press Alt + F1: Detailed to view details of duty calculation. The Statutory Details screen is displayed as shown.
In Bill-wise Details screen
In Type of Ref select New Ref
In Name field specify ABC/941
Amount will be defaulted automatically.
Completed Removal as Such entry is displayed as shown
Press enter to accept and save.
The Rule 11 invoice of Removal as such transaction appears as shown
The details of Removal As Such will be displayed in computation report under Excise Duty Payable section with a separate line item as Removal As Such with Assessable Value and Duty Amount.
The duty liability of a unit can be adjusted towards the excess credit.
Example: on 31-8-2008, before payment of duty to the Government ABC Company adjusted the Duty liability of goods Removed As Such towards CENVAT Credit.
Total Duty Amount is 20567.04
Basic Excise Duty
* Pet Bottles - 2Ltr Rs.16,000
* Water Container - 20Ltr Rs. 4,320
Education Cess
* Pet Bottles - 2Ltr Rs. 320
* Water Container - 20Ltr Rs. 86.40
Secondary Education Cess
* Pet Bottles - 2Ltr Rs.160
* Water Container - 20Ltr Rs. 43.20
Record the transaction in Journal Voucher with CENVAT Adjustment Voucher Class
In Tally.ERP 9 all the CENVAT Adjustment entries are recorded in Journal voucher. Manually adjust the credit towards Tax liability of Removal as Such.
Note: Currently Tally.ERP 9 allows the adjustment of credit and liability of same nature of duty example: BED credit can be adjusted towards BED.
* CENVAT Adjustment between the duties i.e. BED Credit adjustment towards NCCD etc.
* Adjustment of service input credit towards excise duty and vice versa
* Adjustment of CENVAT Credit towards Tax liability of Removal As Such are not supported.
Go to Gateway of Tally > Accounting Vouchers > F7: Journal
In Change Voucher Type screen, select CENVAT Credit Adjustment in Class field
Enter the Date as 31-8-2008.
In Used for field select CENVAT Adjustment
In Excise Unit field select ABC Company
In Debit field select Basic Excise Duty - 16% ledger to adjust the duty liability of goods removed as such
In Excise Duty Allocation screen
In Type of Ref field select Agst Ref
In Name field select the reference ABC/Rule11/Book1/08-09ABC/1012/08-09 identified as As Such
Note: As per rule the CENVAT Credit adjusted against the goods removed as such needs to captured in appropriate column in Form ER - 1, RG 23 Part - I and Abstract report.
To distinguish the tax bills of removal as such against the other removals and to capture the credit adjusted against the tax liability, tax bills of goods removed as such are identified with the tag As Such.
Amount of the bill Rs. 16,000 will be defaulted
In Type of Ref field select Agst Ref.
In Name field select the reference ABC/Rule11/Book1/08-09ABC/1012/08-09 identified as Removal as such.
In Amount of the bill Rs. 4320 will be defaulted
In Debit field select Education Cess @ 2% ledger to adjust the duty liability of goods removed as such
In Excise Duty Allocation screen adjust the bills as shown
In Debit field select Secondary Education Cess @ 1% ledger to adjust the duty liability of goods removed as such
In Excise Duty Allocation screen adjust the bills as shown
In Credit field Basic Excise Duty (CENVAT) ledger to adjust CENVAT Credit towards duty liability
In Excise Duty Allocation Screen
In Type of Ref field select Agst Ref
In Name field select the reference 4587/1 dated 1-8-2008
In Amount field enter the amount which needs to be adjusted towards the liability. The basic Excise Duty lability on goods removed as such is Rs. 20320. Enter Rs. 20320 in amount field.
In Credit field Education Cess (CENVAT) ledger to adjust CENVAT Credit towards duty liability
In Excise Duty Allocation Screen
In Type of Ref field select Agst Ref
In Name field select the reference 4587/1 dated 1-8-2008
In Amount field enter the amount which needs to be adjusted towards the liability. The education cess liability on goods removed as such is Rs. 406.40. Enter Rs. 406.40 in amount field.
In Credit field Secondary Education Cess (CENVAT) ledger to adjust CENVAT Credit towards duty liability
In Excise Duty Allocation Screen
In Type of Ref field select Agst Ref
In Name field select the reference 4587/1 dated 1-8-2008
In Amount field enter the amount which needs to be adjusted towards the liability. The secondary education cess liability on removal as such is Rs. 203.20. Enter Rs. 203.20 in amount field.
Set the option Provide details to Yes to enter the Adjustment Details.
The completed journal voucher is displayed as shown
Press enter to accept.
