One of the kinds of indirect tax is the Central Excise duty that is levied on goods manufactured in India. By virtue of the authority granted by Entry 84 of the Union List (List 1) under Seventh Schedule read with Article 226 of the Constitution of India, the subject of Central Excise duty is administered by the Central Government. The Central Excise duty is levied in accordance with the provisions of the Central Excise Act, 1944. The rates of Excise duty are prescribed under the Schedule I and II of the Central Excise Tariff Act, 1985. As soon as the goods are manufactured, the liability of Central Excise duty arises. The introduction of new rules such as CENVAT Credit Rules, 2001, Central Excise Appeal Rules, 2001 etc. has effected several changes in the procedures of Central Excise. The new procedures are simplified. The Central Excise (No.2) Rules of 2001 have replaced the Central Excise Rules, 1944. The Central Excise law is administered by the Central Board of Excise and Customs through the Central Excise Commissionerates. The country is divided into 10 Zones for this purpose and a Chief Commissioner of Central Excise heads each Zone. Excise duty is required to be paid before the goods are cleared from the factory. The rates of excise duty vary according to the type of commodity, and even for the same type of commodity the rates often differ depending on circumstances such as end-use and taxability of inputs.
