Professional Documents
Culture Documents
with respect to SD
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Modus Operandi
Session - I
Introduction to Indian Taxes
Different Sales processes.
CENVAT Concept
CENVAT Rules and Terminologies
CENVAT and Sales Process.
Base for the CENVAT Credit.
Tax Procedures.
Registers.
India Localization Configurations in SD.
Master Data.
SAP Easy Access settings Relevant For India Localization.
Q&A.
Conclusion.
Introduction
Hi Let us Discuss, What are Indian Taxes and how they are differentiated.
Additional Duty on specified items under the Act : If the Tariff Commission
set up by law recommends that in order to protect the interests of industry,
the Central Government may levy additional duties at the rate
recommended on specified goods.
Input Material:
Is defined as the one which loses its own identity
Capital Goods:
Is defined as the one which does NOT lose its own identity in the finished goods.
Excise Invoice
J1IIN
Dispatch
Stock transfers.
In Stock transfers we will transfer the Materials from Plant to plant and
Plant to Stock yards.
Usually in the stock transfers we create the excise invoice while the goods
is moving from plant to Stock yard.
From stockyard to customer usually we are not going to create the Excise
invoice, because stock which is coming in to the Stock is not an input, it is
just a transfer from one place to other.
There is no price escalations here.
Depot process
Depot is also almost same as Stock yards, and here also we are transferring
goods from Plant to Depot, but the difference is in Depots, are Price
escalations. In Depots goods is coming as input.
Transactions can happen through two scenarios:
Scenario1: Depot receives goods from the companys factory through stock
transfer.
Scenario 2: Depot procures goods directly from external sources.
Depot Process:
For Doing Goods Receipt:
Scenario 1: Stock Transfer
Step1: Do GR (Transaction code:MB01)
Step 2: Excise Invoice Capture at Depot (Transaction Code: J1IG)
Scenario 2:
Step 1: Do GR (Transaction Code: MIGO)
Step 2: Excise Invoice Capture at Depot (Transaction Code: J1IG)
At the time of Sale:
Sales Order Delivery J1IJ (always requires a delivery
number) PGI Billing
ME21N
MIGO
J1IIN
J1IG
J1IJ
Excise Invoice
Plant
Dispatch
Depot
Export Process
In the process of Exports duty under bond is not payable and the
goods move out from the factory against an ARE1.
However, goods not under bond move out of the factory by paying the
duty and refund is separately claimed on showing proof of export I.e.
shipping bill.
In case of Deemed Exports, the same procedure is followed as in
exports, However, the form used is ARE3.
What is CENVAT!?
CENVAT Credit
Rs.100 ED: Rs.10
Rs.500 ED:Rs.50
RM-A
FG-C
RM-B
CENVAT!?
WHEN AND HOW MUCH CREDIT CAN BE TAKEN
The Cenvat Credit in respect of inputs may be taken immediately on receipt of the
inputs.
The Cenvat credit in respect of Capital Goods received in a factory at any point of
time in a given financial year shall be taken only for an amount not exceeding fifty
percent of the duty paid on such capital goods in the same financial year and the
balance of Cenvat Credit may be taken in any subsequent financial year.
The Cenvat credit shall be allowed even if any inputs or capital goods as such or
after being partially processed are sent to a job worker for further processing,
testing, repair etc. and it is established from the records that the goods are received
back in the factory within180 days of their being sent to a job worker.
Where any inputs are used in the final products which are cleared for export, the
Cenvat Credit in respect of the inputs so used shall be allowed to be utilized towards
payment of duty on any final product cleared for home consumption and where for
any reason such adjustment is not possible, the manufacture shall be allowed refund
of such amount.
CENVAT
Rule 1. Short title, extent and commencement.Rule 2. Definitions.Act capital goods Customs Tariff Act exempted goods final products first stage
importer input manufacturer or producer
dealer an
specified areas of
CENVAT
So far
Then we need to assign the Tax procedure TAXINN to county India As shown
below.
Menu path SPRO Logistic General Tax on goods on movement India
Basic Settings Determination of Excise duty Select Tax Calculation
Procedure.
Excise registers.
RG23A: Raw Material
The entries pertaining to quantity will go into RG 23 Part I and that of duty will go into Part II
in the appropriate duty column. i.e. Basic Excise, SED, Additional duty, etc
RG23D: Depot (this indicates both the Quantity and the amount)
Depot Process:
The RG 23 D register is used to update the excise entries in case of
Exciseable Depots.
The Excise duty is payable when the goods are sent from the factory.
However, it is not levied again when the goods are sent from the
DEPOT.
However, while taking sale from the DEPOT and if price escalations
happen, then the extra excise is paid using a A certificate. These
details are entered in the RG23 D register and excise recovered from
the customer.
Depot Process
Transactions can happen through two scenarios:
Scenario1: Depot receives goods from the companys factory
through stock transfer.
Scenario 2: Depot procures goods directly from external sources.
SAP Transactions
J1I5
J2I5
Register Printing
J2I6
Utilization
J2IU
So Far We discussed on
Tax Procedures
Pricing Procedure Relevant to SD.
CENAVT registers
Transaction Codes.
Basic Settings
Excise Registration IDs
Company Code Settings
Plant Settings
Excise Groups
Series Groups
Excise Duty Indicators
Permits deductible /
non deductible ED
at GR
Utilizes from
PLA in JV
Excise invoice
selection
Plant Settings
Plant defined as Depot
or not
Multiple plants to one
Excise Registration ID
Excise Groups
Excise Reg ID linked
to Excise group &
Plant
Depot definition at
Excise Grp & Plant
Series Groups
Account Determination
Describe which excise accounts (for excise duty and CENVAT) are to be posted
to for the various transaction types including sub transaction type if any
J1ID Screen.
Yes
Is the
Customer
SSI?
No
Get
Excep
duty
rates
Yes
Excp rates
Maintained?
No
Get Ch ID
Of the
material
Get Customer
Excise
indicator
Get plant
Excise
indicator
Get final
Excise
indicator
Get rate
Based on
Ex Ind & CH ID
CENVAT Utilization
Payment to be made to Excise Department for the Self Removals for
the last month.
Utilization to be done against the last months incoming excise duties
and CVD.
CENVAT utilization to be done before the 5th of next month.
Credit CENVAT
on-hold A/c
Sales Excise
Invoice Process
CENVAT on hold
for Capital goods
Vendor Excise
Invoice Process
CENVAT Account
Fortnightly Transactions
Deposit funds in PLA
Account
Select
Register
PLA Account
Debit PLA A/c
Excise Duty
Payable Account
Despatch
Rs. 125/-
Cr Sale
Rs. 100/-
Rs.9/-
Rs.16/Rs.16/-
Rs. 16/-
Cr CENVAT Clearing
Rs.16/-
Rs. 16/-