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Excise Journal Adjustments

In excise, the nature of adjustments are provided for various adjustment transactions involving excise duty or service tax, as required by the department. These help in capturing the value for each nature of adjustment in respective fields of excise forms.

To use excise nature of adjustment

1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal .

2. Click J : Stat Adjustment .

3. Select Excise in Type of duty/tax to display the Nature of Adjustment .

4. Select the required unit in Tax Unit field. This field is enabled only when multi-unit is enabled, and created for excise.

5. Press Enter to save.

Note: By default, only the basic nature of adjustments are displayed. Enable the option Allow All Adjustment Types? using F12: Configure in Stat Adjustment Details screen to display the entire set of excise nature of adjustments.

Sl. No.

Excise - Adjustments in Release 5.x

Excise - Adjustments in Release 4.9x

Purpose and Transaction

1

Adjustment towards Duty Liability

Both

Capital Goods

Inputs

CENVAT Adjustment

Select this nature of adjustment when the duty liability or payable amount can be paid using the available CENVAT credit.

Dr. Basic Excise Duty/any other duty head ledger

Cr. Basic Excise Duty/any other duty head ledger

2

Adjustment towards Miscellaneous Payment (Others)

Both

Capital Goods

Inputs

CENVAT Refund/Reversal

Select this nature of adjustment when the reversal of erroneous CENVAT credit availed during previous returns can be paid by utilizing the CENVAT credit, and treated as miscellaneous payments.

Dr. Basic Excise Duty/any other duty head ledger

Cr. Basic Excise Duty/any other duty head ledger

3

Adjustment towards Rule 6

Both

Capital Goods

Inputs

CENVAT Reversal (Rule 6)

Select this nature of adjustment when CENVAT credit was availed on inputs or capital goods used in manufacturing of exempted items, and the credit availed earlier has to be reversed under Rule 6.

Dr. Expense Ledger

Cr. Basic Excise Duty/any other duty head ledger

4

Excise Duty on Movements of Stocks

Both

Capital Goods

Inputs

Excise Duty on Movements of Stocks

Select this nature of adjustment if only the movement stock has taken place during inter unit transfer of stock, and the unit has to create the liability on such goods and remit the duty to the government.

This adjustment appears only for large taxpayer unit, when movement of stock is allowed without duty liability.

Dr. Purchase or Expense Ledger

Cr. Basic Excise Duty/any other duty head ledger

5

Adjustment towards Rounding Off

Both

Capital Goods

Inputs

Rounding Adjustments

Amount gets rounded-off automatically in returns. Hence, functionality is not provided for this nature of adjustment.

6

Adjustment towards Other Payments (Arrears)

Both

Capital Goods

Inputs

---

Select his nature of adjustment when duty liability of previous period is paid during the current period by utilizing the CENVAT credit and treated as other payments - arrears

Dr. Basic Excise Duty/any other duty head ledger

Cr. Basic Excise Duty/any other duty head ledger

7

Adjustment towards removal As Such (Capital Goods)

Both

Capital Goods

Inputs

---

Select this nature of adjustment when the capital goods are removed as such (sales or purchase returns), and the duty involved in such transactions has to be adjusted towards the available CENVAT Credit.

Dr. Basic Excise Duty/any other duty head ledger

Cr. Basic Excise Duty/any other duty head ledger

8

Adjustment towards removal As Such (Inputs)

Both

Capital Goods

Inputs

---

Select this nature of adjustment when the principal inputs/sales return of finished goods received are removed as such (sales or purchase returns), and the duty involved in such transactions has to be adjusted towards the available CENVAT Credit.

Dr. Basic Excise Duty/any other duty head ledger

Cr. Basic Excise Duty/any other duty head ledger

9

Adjustment towards Rule 10A

Both

Capital Goods

Inputs

---

Select this nature of adjustment when the Credit available under the duty head “Additional Duty on Imports (ADC_LVD_CT 75)” is allowed to be transferred from one unit to another branch unit of the same company.

Transferring unit

Dr. Branch/division (unit 2)

Cr. Additional Duty of Imports

Receiving unit

Dr. Additional Duty of Imports

Cr. Branch/division (unit 1)

10

Availment of CENVAT Credit (Capital Goods)

Nature of Purchase:

First Stage Dealer

Importer

Manufacturer

Purchase from Importer

Second Stage Dealer

---

Select this nature of adjustment to avail CENVAT credit on capital goods if the duty amount was treated as additional cost during purchase.

Nature of Purchase: Manufacturer , First Stage Dealer , Second Stage Dealer , Purchase from Importer or Imports

Dr. Basic Excise Duty/any other duty head ledger

C r. Purchase Ledger (Capital Goods)

(Or)

Dr. Basic Excise Duty/any other duty head ledger

Cr. Fixed Assets

Note: The above mentioned transaction of Fixed Assets is recorded:

Without inventory in case of journal.

With inventory in case of debit note.

11

Availment of CENVAT Credit (Inputs)

Nature of Purchase:

First Stage Dealer

Importer

Manufacturer

Purchase from Importer

Second Stage Dealer

---

Select this nature of adjustment to avail CENVAT credit on inputs if the duty amount was treated as additional cost during purchase.

Type of stock item: Principal Input or Other Inputs

Nature of Purchase: Manufacturer , First Stage Dealer , Second Stage Dealer , Purchase from Importer or Imports

Dr. Basic Excise Duty/any other duty head ledger

Cr. Purchase (Raw Material)

12

Availment of Credit under Rule 12BB

Both

Capital Goods

Inputs

---

Select this adjustment to avail credit under Rule 12BB when the company is configured as a large taxpayer unit.

Dr. Basic Excise Duty/any other duty head ledger

Cr. Basic Excise Duty/any other duty head ledger

13

CENVAT Credit Used For Service Tax Payable (Capital Goods)

Both

Capital Goods

Inputs

---

Select this nature of adjustment when CENVAT credit of capital goods is used to pay service tax liability.

Dr. Service Tax Payable ledger

Cr. Basic Excise Duty/any other duty head ledger (created under Duties & Taxes with CENVAT as Type of duty/tax )

14

CENVAT Credit Used For Service Tax Payable (On Inputs)

Both

Capital Goods

Inputs

---

Select this nature of adjustment to adjust CENVAT credit availed on purchase of excisable raw material against service tax payable.

Dr. Service Tax Payable ledger

Cr. Basic Excise Duty/any other duty head ledger (created under Duties & Taxes with CENVAT as Type of duty/tax )

15

ISD Credit Received From Service Tax

Both

Capital Goods

Inputs

---

Select this nature of adjustment, when input service distributor distributes the CENVAT credit with respect to service tax paid on the input service to its manufacturing units.

Dr. Service Tax Input Credit ledger (created under Duties & Taxes / Current Assets )

Cr. Branch/division ledger

16

Service Tax Credit Used For Excise Duty Payable

Both

Capital Goods

Inputs

---

Select this nature of adjustment when excise duty payable is adjusted against service tax input credit.

Dr. Basic Excise Duty/any other duty head ledger

Cr. Service Tax Input Credit (created under Duties & Taxes / Current Assets )

17

Service Tax Credit Used For Excise Duty Payable (Removal As Such)

Both

Capital Goods

Inputs

---

Select this nature of adjustment when excise duty payable on Removal As Such is adjusted against service tax input credit.

Dr. Excise Duty ledger (duty payable on Removal As Such)

Cr. Service Tax Input Credit ledger (created under Duties & Taxes / Current Assets )

18

Shortage/Damage/Loss of Excise Stock

Both

Capital Goods

Inputs

---

Select this nature of adjustment to account for damage/loss of excise stock.

Dr. Expense ledger

Cr. Purchase ledger

19

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Adjustment Towards Advance Duty Paid

Advance duty payment has been disallowed by the Excise Department as per the latest amendments. Hence, this nature of adjustment has not been provided.