Table of Contents SD CIN ....................................................................................................................................................................................................................... 3

Excise Invoice (Outgoing) .................................................................................................................................................................................... 4

Material Master (Excise Data) ............................................................................................................................................................................ 5

Vendor Master (Country Version India Data) ............................................................................................................................................. 5

Customer Master (Country Version India Data) ......................................................................................................................................... 6

Pricing .......................................................................................................................................................................................................................... 7

Excise Duties ......................................................................................................................................................................................................... 7

Sales Taxes ............................................................................................................................................................................................................ 8

CUSTOMIZATION SETTINGS .............................................................................................................................................................................. 8

Basic Settings ....................................................................................................................................................................................................... 8

Excise Registration ........................................................................................................................................................................................ 8

Maintain Company Code Settings ........................................................................................................................................................... 9

Plant Setting ................................................................................................................................................................................................... 10

Maintain Excise Groups ............................................................................................................................................................................. 10

Maintain Series Groups ............................................................................................................................................................................. 13

Maintain Excise Duty Indicators ............................................................................................................................................................ 13

Determination of Excise Duty ................................................................................................................................................................. 14

Master Data ......................................................................................................................................................................................................... 16

Maintain Chapter IDs ................................................................................................................................................................................. 16

Assign Users to Material Master Screen Sequence for Excise Duty ........................................................................................ 17

Define Form Types ...................................................................................................................................................................................... 17

Account Determination .................................................................................................................................................................................. 18

Define G/L Accounts for Taxes ............................................................................................................................................................... 18

Specify Excise Accounts per Excise Transaction ............................................................................................................................ 19

Specify G/L Accounts per Excise Transaction.................................................................................................................................. 20

Sales from Factories - (J1IIN) ........................................................................................................................................................................... 22

Automatic Creation of Excise Invoices .................................................................................................................................................... 23

Exemption Forms ............................................................................................................................................................................................. 24

Export-Oriented Units .................................................................................................................................................................................... 24

Creation of Excise Invoices in Batches ..................................................................................................................................................... 25

Printout of Excise Invoices ........................................................................................................................................................................... 26

Creating Pro Forma Excise Invoices ......................................................................................................................................................... 26

Creating Excise Invoices ................................................................................................................................................................................ 27

Excise Duty Utilization............................................................................................................................................................................... 28

Duty Payable on Sale or Transfer of Capital Goods ............................................................................................................................ 30

Canceling Excise Invoices .............................................................................................................................................................................. 31

Sales from Depots J1IJ ...................................................................................................................................................................................... 31

Creating Excise Invoices for Stock Transfers ........................................................................................................................................ 32

Creating Excise Invoices for Direct Purchases ..................................................................................................................................... 33

Creating Additional Excise Entries at Depots ....................................................................................................................................... 33

Assigning Excise Invoices to a Delivery .................................................................................................................................................. 34

Verifying and Posting Excise Invoices Assigned to Delivery .......................................................................................................... 35

Other Outward Movements ............................................................................................................................................................................... 35

Creating Excise Invoices ................................................................................................................................................................................ 36

Duty Payable on Sale or Transfer of Capital Goods ............................................................................................................................ 36

Verifying and Posting Excise Invoices ..................................................................................................................................................... 37

Canceling Excise Invoices .............................................................................................................................................................................. 38

Creating Excise Invoices for Stock Transfers ........................................................................................................................................ 38

Making a Transfer Posting ............................................................................................................................................................................ 38

Exports Under Excise Regulations ................................................................................................................................................................. 39

Exports Under Bond ........................................................................................................................................................................................ 39

Excise Bond .................................................................................................................................................................................................... 40

ARE-1 Processing ......................................................................................................................................................................................... 42

Pro Forma of Running Bond Account .................................................................................................................................................. 49

Statement Regarding Export of Excisable Goods ........................................................................................................................... 49

Bond Summary Report .............................................................................................................................................................................. 50

Exports Under Claim for Rebate ................................................................................................................................................................. 50

ARE-1 Processing ......................................................................................................................................................................................... 51

Deemed Exports ................................................................................................................................................................................................ 56

Deemed Export License............................................................................................................................................................................. 57

ARE-3 Processing ......................................................................................................................................................................................... 59

Deemed Export License Summary ........................................................................................................................................................ 65

ARE Documents ................................................................................................................................................................................................. 65

Transaction Configuration ....................................................................................................................................................................... 68

ARE Document Numbering ...................................................................................................................................................................... 68

Aging Analysis for ARE Documents .......................................................................................................................................................... 73

Transaction Codes ............................................................................................................................................................................................ 74

Form Tracking ........................................................................................................................................................................................................ 75

Sales Register .......................................................................................................................................................................................................... 75

CENVAT Adjustment Postings.......................................................................................................................................................................... 76

Making Adjustment Postings for Scrap............................................................................................................................................... 77

Making Adjustment Postings for Materials Not Used in Production ...................................................................................... 78

Making Adjustment Postings for Additional Excise Paid by Vendors .................................................................................... 79

Making Adjustment Postings for Money Transferred to PLA .................................................................................................... 79

Canceling Excise Invoices ......................................................................................................................................................................... 80

Making Adjustment Postings for Other Transactions .................................................................................................................. 80

Assigning Excise Invoices to Line Items ............................................................................................................................................. 81

Specifying Which CENVAT Accounts to Adjust ............................................................................................................................... 81

Displaying CENVAT Account Balances................................................................................................................................................ 82

Excise Registers: .................................................................................................................................................................................................... 82

Forms / Outputs / Reports: ........................................................................................................................................................................... 107

Monthly Reports: ................................................................................................................................................................................................ 107

Transaction Codes for India ........................................................................................................................................................................... 107

Taxes (FI-AP/AR) ............................................................................................................................................................................................... 109

Excise Duty ....................................................................................................................................................................................................... 110

Partial CENVAT Credit ............................................................................................................................................................................ 111

Monthly Remittance of Excise Duty and Service Tax ................................................................................................................. 112

Value Added Tax (VAT) ............................................................................................................................................................................... 114

Configuration for Official Document Numbering ........................................................................................................................ 115

Service Tax ....................................................................................................................................................................................................... 116

GTA Service Tax ......................................................................................................................................................................................... 117

Posting GTA Service Tax ........................................................................................................................................................................ 119

Update GAR-7 Challan............................................................................................................................................................................. 121

Sales Tax ............................................................................................................................................................................................................ 125

Sales Tax Register ..................................................................................................................................................................................... 126

Withholding Tax ............................................................................................................................................................................................. 126

Tax Collected at Source ............................................................................................................................................................................... 127

Customizing for Tax Collected at Source ........................................................................................................................................ 128

Sales and Distribution CIN

SD CIN Purpose

The Sales and Distribution (SD) component covers the most important laws and business practices specific to India. The following documentation describes these aspects of the component.

Features

Country-Specific Functions

Country Version India comes with functions for calculating, posting, and remitting excise duty:

The system determines the excise and other taxes on your sales. You can create outgoing excise invoices, customized to your own requirements, and make the appropriate

accounting postings.

The system offers functions for domestic and export sales from factories and depots, including exports under excise regulations.

All goods movements are recorded in the appropriate excise registers, including register RG 23D. You can remit the excise duty using the delivered functions.

Country Template

The country template for India comes with sample pricing procedures, including all taxes, and settings for automatic account determination to the appropriate excise accounts.

EXCISE INVOICE (OUTGOING) Definition

A business document, in India, that you prepare when you issue excisable goods from a manufacturing plant, for example:

To be sold to a customer

To be transferred to another of your plants

The excise invoice lists the goods that you have issued and states how much excise duty applies. Your customer uses the excise invoice to claim back the excise that it has paid from the excise authorities.

Use

In the system, there are three different procedures for creating excise invoices

Sales direct from the factory

This procedure is for when you sell manufactured goods straight from the factory at which they were produced, in which case you levy excise duty when the goods leave the factory on their way to the customer.

If, when you send the goods to the customer, you enclose the commercial invoice, you create the excise invoice with reference to the commercial invoice. If you want to send the commercial invoice after you have dispatched the goods, however, you create the excise invoice with reference to a pro forma commercial invoice. For more information about these procedures, see Sales from Factories.

As well as creating excise invoices individually, you can also create them in batches (see Creation of Excise Invoices in Batches).

Sales from depots

A depot is a site at which the goods are stored, away from the factory at which they were produced. In this procedure, you have to levy the excise duty when you transfer the goods from the factory to the depot, and then make sure this is passed on to the customer when it makes a purchase. For more information, see Sales from Depots.

Sales (other goods movements)

Some other goods movements may also require you to create an excise invoice with reference to other documents. The system offers separate functions for these purposes (see Other Outward Movements).

Structure

Numbering of Excise Invoices

Outgoing excise invoices have two numbers: an internal document number, which is assigned immediately you create an excise invoice; and an excise invoice number, which is not assigned until you have verified and posted it.

As far as the excise invoice number is concerned, you have to:

a. Number your outgoing excise invoices in sequential order, starting each year on 1 April. b. You must notify the excise authority of the jurisdiction of the invoicing location. c. The serial number must be printed on each page of the excise invoice.

Each number range is governed by a series group. You must create at least one series group in order to be able to number the excise invoices. If you need more than one number range, you must create the corresponding number of series groups. You do so in Customizing for Logistics General, by choosing Taxes on Goods Movements India Basic Settings Maintain Series Groups.

Number of Line Items per Excise Invoice

Some states allow you to include only a limited number of items for each page of an excise invoice (for example, if the excise invoices are to be printed on pre-numbered forms). You can customize the system so that it prints the excise invoice accordingly, in Customizing for Logistics General, by choosing Taxes on Goods Movements India Basic Settings Maintain Excise Registrations.

MATERIAL MASTER (EXCISE DATA) Definition

The part of the material master record where you record excise information.

To access the material master, from the SAP Easy Access menu, choose Logistics Materials Management Material Master Material

The excise data is displayed in a separate group box on the Foreign Trade: Import Data and Foreign Trade: Export Data tabs.

Use

Customizing

In order for the users to be able to see the excise data group box, carry out the IMG activity in Customizing for Logistics General, by choosing Taxes on Goods Movements India Master Data Assign Users to Material Master Screen Sequence or Excise Duty.

VENDOR MASTER (COUNTRY VERSION INDIA DATA)

The part of the vendor master record where you record information about a vendor relating to sales tax, excise duty, and withholding tax.

To access the vendor master, from the SAP Easy Access screen, choose Logistics Materials Management

Purchasing Master Data Vendor Central ....

When you have entered the vendor that you want to process, you can access the excise data from every screen, by choosing CIN Details.

There are three separate tabs, one for each sort of tax.

If you prefer, you can also maintain this data in the Excise Rate Maintenance transaction (see Vendor Master (Excise Data)).

TAN Exemption

You can define the withholding tax exemption for a vendor on the basis of the tax account deduction number (TAN).

Choose the CIN Details pushbutton. On the resulting screen, under the TAN Exemption tab, make the following settings:

Enter the section code that identifies under which TAN the tax was deducted.

Enter the exemption certificate number and the exemption rate.

The exemption certificate field is mandatory.

Assign a period to this certificate number that identifies the duration for which the tax exemption is applicable.

Enter the reason for exemption from withholding tax.

CUSTOMER MASTER (COUNTRY VERSION INDIA DATA) Definition

The part of the vendor master record where you record information about a vendor relating to sales tax, excise duty, and withholding tax.

To access the vendor master, from the SAP Easy Access screen, choose Logistics Sales and Distribution Master Data Business Partners Customer .

Use

When you have entered the customer that you want to process, you can access the excise data from every screen, by choosing CIN Details.

There are three separate tabs, one for each sort of tax.

If you prefer, you can also maintain this data in the Excise Rate Maintenance transaction

PRICING Use

When you create a sales document, the system automatically determines the price of the goods you are selling, including any excise duties and sales taxes.

Features

Country Version India comes with four pricing procedures as follows:

JINFAC (Sales from manufacturing plants) JINEXP (Export sales) JINDEP (Sales from depots) JINSTK (Stock transfers)

These pricing procedures determine the net price (or the assessable value, if there is one) and then calculate all forms of excise duties and sales taxes on the goods.

Excise Duties For each form of excise duty, there are three separate condition types as follows:

Excise duty Ad valorem Specific Total*

Basic JEXP JEXQ JEXT

Additional JEAP JEAQ JEAT

Special JESP JESQ JEST

Cess JCEP JCEQ JCET

* These condition types show, for example, the total basic excise duty on the goods (ad valorem duty plus specific duty). It is the values in these condition types that the system uses in follow-on documents.

All of these condition types are discount surcharge conditions and are posted using the accounting key EXD.

The excise conditions are determined using the access sequence JEXC. This access sequence contains the following condition tables, so that you can create excise condition records for all of the following combinations:

Table Conditions

362 Country, Chapter ID*

357 Country, Plant, Chapter ID

358 Country, Plant, Chapter ID, Material

371 Country, Plant, Chapter ID, Ship-To Party

369 Country, Plant, Chapter ID, Customer Tax Classification

372 Sales Organization, Reference Document And Item

* The chapter ID is stored in the control code field. When you enter a material's chapter ID in the material master, the system copies the chapter ID to the control code field. When you create a condition record, the field name is control code.

If you want to create condition records for different types of customers, for example, those that qualify for concessional tax rates and those that don't, you can define customer tax classifications in Customizing and create condition records for each classification.

Sales Taxes For central sales tax and local sales tax, there are two condition records each, one for the basic tax (JCST and JLST respectively), and one for surcharges (JCSR and JLSR). These are all tax conditions and are posted with the account key MWS or MW3. When you create a condition record for the sales taxes, you must specify a tax code that you want the tax to be posted under in Financial Accounting (FI).

The system determines the central sales tax using the access sequence JCST, and local sales tax using the access sequence JLST. Both access sequences use the following condition tables:

Table Conditions

359 Plant, material group

367 Country, plant, region, material

368 Country, Region Of Delivering Plant, Region Of Ship-To Party, Customer Tax Classification, Material Tax Classification

CUSTOMIZATION SETTINGS

Basic Settings

Excise Registration An entity in India that is entitled by law to produce any goods liable to excise. Each entity is assigned its own excise registration number.

Every factory that manufactures excisable goods is required to register separately, so that a business with seven factories requires seven registrations.

Partial CENVAT Credit

Specifies that the excise registration is allowed to credit only a portion of its input excise duty to its CENVAT account.

Dependencies

When you post a goods receipt, the system splits the input excise duty on the material into its deductible and nondeductible amounts. It posts the deductible duty to the appropriate CENVAT account, and adds the nondeductible duty to the material value.

This information is also shown when you post the incoming excise invoice.

Maintain Company Code Settings

Exch. rate type for CVD: You can use the exchange rate type to define a buying rate, selling rate, or average rate for translating foreign currency amounts. You can use the average rate for the currency translation, and the bank buying and selling rates for valuation of foreign currency amounts.

Exchange rate type for exports:

CVD (Countervailing duty): A form of excise duty imposed on imports that are subsidized by the country in which they were manufactured.

Countervailing duty (also known as CVD) is intended to make the imports more expensive, thereby redressing any competitive advantage they might have over goods produced locally.

Plant Setting

Maintain Excise Groups A unit within an excise registration, in India, which keeps its own set of excise records.

Whereas the excise registration reports to the excise authorities, the excise group is a purely internal organizational unit. Each excise group keeps records of all transactions that have to be reported to the excise authorities. When the time comes to present these records to the authorities, the excise registration compiles the information from all of its excise groups.

Number of Goods Receipts per Excise Invoice:

Specifies whether you are allowed to receive more than one delivery per excise invoice, and if so, whether you can take the CENVAT credit immediately or have to wait until the delivery has been made in full (Multiple Credits)(Single Credit).

Default Challan Qty. in GR:

Instructs the system, when you post a goods receipt using an incoming excise invoice as a reference document, to copy the excise invoice quantity to the goods receipt.

Excise Invoice during Billing:

Instructs the system to automatically create an outgoing excise invoice immediately you create a commercial invoice or a pro forma invoice.

The system creates the excise invoice in the background.

Dependencies

If you want to make use of this function, you must also define the default plant, excise group, and series groups in Customizing for Excise Duty, by choosing Business Transactions -> Outgoing Excise Invoices -> Maintain Default Excise Groups and Series Groups.

Create and Post Invoice single step J1IS:

Instructs the system to automatically verify and post excise invoices that you create using the Excise Invoices for Other Movements transaction.

Consumption: Create Part I Entry for Direct Consumption:

Automatically creates two entries in Part I of register RG 23 A or RG 23 C immediately you post a goods receipt for direct consumption, one entry to record the goods receipt, and one for the goods issue.

Use

Uniquely, goods for direct consumption are not added to a material stock. Instead, the system posts them straight to a consumption account. You do not create a separate goods issue.

However, with other goods, it is the goods issue material document that causes the system to create the Part I entry for the goods issue.

This function overcomes that problem: When you enter a goods receipt for direct consumption, the sysstem automatically creates two Part I entries (for the receipt and the issue) from the goods receipt document.

Examples:

You enter a goods receipt for 100 lengths of steel for direct consumption. The system creates a single material document for the goods receipt and issue. From this material document it generates two Part I entries for register RG 23 A, one for the goods receipt and another for the goods issue.

Depot Indicator: Depots are required to prepare register RG 23D, and follow different procedures for goods receipt and invoice generation.

Generate Folio Numbers: folio numberAutomatically generates a when you post goods receipts and goods issues register RG 23D.that are recorded in

Folio Number: A number assigned to all entries in register RG 23D.

When you enter a goods receipt at a depot, the system generates a separate register entry for each line item in the

material document. The entries are numbered consecutively. This is the folio number.

Example

A warehouseman enters a goods receipt for one table and four chairs. The system generates two entries in register RG

23D, one for each line item. Both entries have the same serial number, but each has a different folio number.

Depot Excise invoice: Automatically verifies and posts the selection of excise invoices that you have assigned to a delivery from a depot.

Capture Excise Invoice in MIGO: Enables users to capture incoming excise invoices when they enter a goods receipt in the standard transaction, (MIGO). Goods Movement

This applies to manufacturing plants and depots alike.

Dependencies

When you run the Goods Movement transaction, it shows two additional Excise Invoice tabs, one at header level and one at item level.

You enter the goods receipt details and the excise invoice information. When you save the goods movement, the system automatically saves the excise invoice, to be posted by an excise supervisor later on using the Incoming Excise Invoices transaction.

Maintain Series Groups Based on excise regulations and exemptions from the authorities you can maintain multiple number series for outgoing documents. But each of these series has to be declared to the excise authorities.

No utilization Flag

If you do not need any CENVAT utilization for an excise invoice but would like to just generate an excise invoice then you need to mark this indicator.

If the flag is checked then system will create an Excise invoice in the given Series group but there will not be any account postings or Part2 postings.

Immediate Utilization of CENVAT

Specifies that when you create an excise invoice, the system immediately pays the amount from CENVAT and creates the Part II entry. Such invoices will not be listed for fortnightly utilization. If you have both fortnightly and immediate utilization for the same excise group, the account determination within CIN IMG should point to the ED interim account. Account determination for immediate payment will be done exactly the same as being done for fortnightly utilization program.

Maintain Excise Duty Indicators

Determination of Excise Duty

Select Tax Calculation Procedure You specify which tax procedure you want to use for determining excise duties and sales taxes on input materials in India.

If you use condition-based excise determination, use a copy of the tax procedure TAXINN. If you use formula-based excise determination, use a copy of the tax procedure TAXINJ.

This tax procedure also supports condition-based excise determination, so that you can work with both concurrently.

We strongly recommend that new customers use condition-based excise determination. Note that once you have started

using a tax procedure, you cannot switch to another one; otherwise you will not be able to display old documents.

Maintain Excise Defaults You define which tax procedure and pricing condition types are used in calculating excise taxes using formula-based

excise determination.

Activities

If you use condition-based excise determination, fill out the CVD cond. field and leave all the others blank.

If you use formula-based excise determination, fill out all of the fields as follows:

Enter the tax procedure and the pricing conditions that are relevant for excise tax processing. Specify the purchasing and sales conditions types used for basic excise duty, additional excise duty, special

excise duty, and Cess. Specify the conditions in the sales order that are used for excise rates. Specify the countervailing duty condition type used for import purchase orders.

Condition-Based Excise Determination

Define Tax Code for Purchasing Documents You define a tax code for the purposes of calculating excise duty when you enter purchasing documents.

Only carry out this activity if you use condition-based excise determination. Create a new tax code, and set the tax code type to V (input tax). Do not make any other settings for it.

Assign Tax Code to Company Codes Assign the tax code for purchasing documents to the company codes where it will be used. Only carry out this activity if you use condition-based excise determination.

Classify Condition Types You specify which condition types you use for which sort of tax. Note that this only applies to condition types that you use with the new excise determination method.

The system uses this information when you create a document from another one. For example, when you enter an incoming excise invoice from a purchase order, or when you create an outgoing excise invoice from a sales order, the system determines the various excise duties in the excise invoice using the information that you have entered here.

In addition, when you create a purchasing document, the system only uses the condition types that you enter here.

For taxes on purchases, use the condition types contained in the tax procedure. For taxes on sales, use the condition types contained in the pricing procedures.

`

Master Data Maintain Chapter IDs Is the number given to a material in the schedules of materials published by the government of India.

The schedule lists all materials involved in manufacturing, input materials and output materials alike. It shows how much excise duty is levied on each material. Each material in the schedule is assigned its own identification code, called "chapter ID."

Example

The schedule contains an entry for ceramic roofing tiles, which are liable to basic excise duty at 16%. The chapter ID associated with these tiles is 6903.10.

Assign Users to Material Master Screen Sequence for Excise Duty You customize the material master data so that it shows the information relating to excise duty.

Standard settings

Country Version India comes with a screen sequence (IN) that shows the excise duty fields. You have to assign it to each of your users.

Activities

1. Double-click User Screen Reference.

2. Assign all users who need to see the excise duty information to the screen reference IN.

Define Form Types You define which form types you want to record in the system. You can only use form tracking for the form types that you enter here.

Example

Form type: CT3 Form description: Concessional tax form Status: Receive

Account Determination Define G/L Accounts for Taxes You specify which G/L accounts you will use to record which taxes.

Assign an account to each of the following posting keys. The accounts for VS1, VS2, and VS3 are used as clearing

accounts during excise invoice verification.

VS1 (basic excise duty) VS2 (additional excise duty) VS3 (special excise duty) VS5 (sales tax setoff) MWS (central sales tax)

MW3 (local sales tax) ESA (service tax) ESE (service tax expense)

Specify Excise Accounts per Excise Transaction

You specify which excise accounts (for excise duty and CENVAT) are to be posted to for the various transaction types. Enter all the accounts that are affected by each transaction type.

If you use subtransaction types, enter the accounts for each subtransaction type as well.

Activities

Transaction type UTLZ is used for determining accounts only while posting excise JVs and also if the payment of excise duty has to be done fortnightly.

The fortnightly CENVAT payment utility picks up the credit side accounts from the transaction types of GRPO, EWPO, and TR6C for determining the CENVAT and PLA accounts. There is no separate transaction type for fortnightly payment.

Example

Excise TT DC ind Account name

GRPO CR CENVAT clearing account

GRPO CR RG 23 BED account

GRPO DR CENVAT on hold account

Specify G/L Accounts per Excise Transaction

You assign the excise and CENVAT accounts to G/L accounts.

When you come to execute the various transactions, the system determines which G/L accounts to post to by looking at the:

Excise group Company code Chart of accounts

Furthermore, if you want separate account determination settings within an excise group, you can also use sub transaction types.

Requirements

You have already:

Defined the G/L accounts

Defined the excise groups

Maintained the transaction accounts

Activities

For each excise group, assign the excise and CENVAT accounts to G/L accounts. For most businesses, one set of accounts will suffice for all transactions.

Note

You need not remit the CENVAT to the excise department immediately, so maintain the credit account for transaction type DLFC as an excise duty interim account. This will be set off when you remit the duty.

SALES FROM FACTORIES - (J1IIN) Purpose

This process describes how the SAP system handles sales from factories, allowing for the creation of excise invoices, which you have to send with each delivery that is subject to excise duty. There are two scenarios, depending on whether you want to send the commercial invoice along with the delivery or at a later date.

Prerequisites

In order for the system to be able to copy the information from document to document, you must have set up the copying control procedures in Customizing for Sales and Distribution (SD). This differs according to when you want to send the commercial invoice:

Along with the delivery

In this case, the document flow would be OR (standard sales order type) LF (standard delivery type) F2 (invoice).

At a later date

The document flow would be OR JF (delivery type, a copy of LF) JEX (pro forma billing document type, a copy of document type F8) F2.

In addition, you must also have maintained the settings in Customizing for Logistics General, by choosing Taxes on Goods Movements India Business Transactions Outgoing Excise Invoices Assign Billing Types to Delivery Types.

Two sample pricing procedures are provided for this sales procedure, J1INFAC (condition-based excise determination) and JFACT (formula-based excise determination).

Process Flow

1. The sales clerk creates a sales order, following the standard procedure.

There are special procedures for customers in possession of exemption forms.

2. The shipping clerk creates a delivery, again, following the standard procedure.

On the initial screen, you set the appropriate delivery type.

3. The warehouseman enters the goods issue.

The system only allows users to create a pro forma excise invoice if the delivery is complete, so as to prevent them from creating multiple pro forma excise invoices.

4. What you do at this stage depends on whether you want to send the commercial invoice along with the delivery or whether you want to invoice the customer later.

If the invoice is to be shipped with delivery, the shipping clerk:

Creates an invoice, following the standard procedure. Creates an excise invoice from the invoice

If the invoice is to be sent on at a later date, the shipping clerk:

Creates the pro forma excise invoice

The pro forma excise invoice is only required for technical purposes and is not sent to the customer. The system does not make any accounting postings at this stage.

Creates an excise invoice from the pro forma excise invoice

In both these cases, the system creates an accounting document to post the excise duty to a clearing account.

Instead of creating excise invoices manually, you can also have the system create them automatically. Alternatively, you can create them in batches.

5. You ship the goods.

6. When the time comes to invoice the customer, you create the invoice, following the standard procedure.

Irrespective of the number of excise invoices that you have issued, you can combine the delivery items in a single invoice

(if the standard requirements are met).

Automatic Creation of Excise Invoices Use

The system can automatically create an outgoing excise invoice for you immediately you post a commercial invoice (or a pro forma invoice) for a customer sale. This function applies to excise invoices for sales from factories only.

Activities

Customizing

Activate the function in Customizing for Logistics General, by choosing Taxes on Goods Movements India Basic Settings Maintain Excise Groups.

Specify which CENVAT accounts the system is to post the different types of excise duty to, in Customizing for Logistics General, by choosing Taxes on Goods Movements India Business Transactions Utilization Utilization Determination.

Specify which excise group and series group the excise invoices are to be created for, in Customizing for Logistics General, by choosing Taxes on Goods Movements India Business Transactions Outgoing Excise Invoices Maintain Default Series Groups and Excise Groups.

Day-to-Day Activities

When you post an invoice, the system creates an excise invoice. All the information that it needs to create the excise invoice is provided either by the invoice or by the Customizing settings that you have made. It also determines the excise invoice type automatically.

Exemption Forms Use

Some customers may be liable to excise duty at reduced rates or exempt from it altogether (for example, customers abroad). Such businesses must provide you with a copy of their exemption forms in order to claim their exemption.

Activities

If you make a sale to a customer that is in possession of an exemption form, you have to record the form number in the sales order. The system then automatically applies the appropriate rate of excise duty.

When you create the sales order, enter the form, using the customer tax classification fields. Based on the customer tax classification status, you can use different excise rates for a sale transaction.

If the form has not been submitted by the time you create the pro forma excise invoice, the excise value will be recalculated at the normal rate.

Export-Oriented Units Use

Any sales that you make to export-oriented units (EOUs) require special treatment by the SAP System.

Prerequisites

You have maintained a zero-rate excise duty indicator for customers that qualify as 100% EOUs.

Activities

When you come to create the excise invoice, the excise value is zero in the pro forma excise invoice document. No excise duty is debited to the CENVAT account, and so no accounting entries are generated. However, the sale is marked as a deemed export, and the system generates an outgoing excise invoice.

Even though the excise duty is zero, when you print the excise invoice, the system calculates the duty for the purposes of printing.

Creation of Excise Invoices in Batches Use

You use this report to create excise invoices for batches of invoices and batches of pro forma excise invoices, instead of creating each one individually (see Sales from Factories). The excise invoices are then created in the background.

Features

To access the report, from the SAP Easy Access (J1ILN CIN) screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice For Sales Order Batch Utilization (J1I3)

Selection

On the selection screen, specify which billing documents (invoices or pro forma excise invoices) you want to create excise invoices for.

Output

A list of commercial invoices and pro forma excise invoices appears which you process as follows:

1. If you want to see how much credit is available on your CENVAT accounts and if there is enough to cover the excise duty that you will incur when you create the excise invoices choose Account balances.

A dialog box appears with the following information:

o The amounts under Balances are the amounts available on the CENVAT accounts. o The amounts under Utilization are the total amounts of the excise duties to be levied.

o If the CENVAT accounts do not contain enough credits to cover the excise duties, the amount short is shown under Deficit.

2. When you know which documents you want to process, select them and choose Batch utilization.

Printout of Excise Invoices Use

You use this report to print outgoing excise invoices.

Prerequisites

You have:

Customized the output for billing documents

You can do so in Customizing for Sales and Distribution (SD), by choosing Basic Functions Output Control Output Determination Output Determination Using Condition Technique Maintain Output Determination for Billing Documents.

You can use output type J1I0 and the SAPscript form J_1I_EXC_INVOICE. The driving program is J_1IEXCP. The output determination has been set up for the billing document that is used as the excise invoice reference.

Maintained condition records for the output

You can do this in Logistics Sales and Distribution Master Data Output Billing Document Create. This ensures that output gets copied to all the excise reference documents.

Features

To access this function, from the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice For Sales Order Print.

Selection

On the selection screen, enter the numbers of the excise invoices. If any of these are reprints, select Incl. printed excise inv.

Output

From the list of excise invoices, you have the following options:

To display an excise invoice, select it and choose .

To print an excise invoice, select it and choose .

Creating Pro Forma Excise Invoices

You create a pro forma excise invoice as you would Create any other billing document, but in the Billing type field, select Excise invoice

Creating Excise Invoices

This is the standard procedure that you follow to create an outgoing excise invoice. You create the excise invoice from a

reference document: an invoice, a pro forma excise invoice, or a billing document.

Prerequisites

You have:

Customized the rounding-off indicator for sales transactions Specified which exchange rate type to use for export invoices

You make both of these settings in Customizing for Logistics - General, by choosing Taxes on Goods Movements India Basic Settings Maintain Company Codes .

Procedure

From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice For Sales Order Outgoing Excise Invoice Create/Change/Display ...

1) If you want to create the excise invoice with reference to a pro forma excise invoice or commercial invoice, choose Excise Invoice Create.

a) If you want to create the excise invoice with reference to a delivery note, choose Exc. inv. for delivery Create.

1. Enter the number of the reference document.

If you do not know the document number, you can search for it by choosing (Due List).

2. Choose (Continue).

The excise invoice screen appears. The header data is displayed at the top; the line items, which the system has copied

from the reference document, are displayed at the bottom.

3. Enter header data as required.

4. To check if the utilization is done properly and the document is ready for posting, choose (Check).

5. To enter texts for the excise invoice, choose (Change text).

6. To display the utilization details, choose (Calculate).

The system displays the available balance against each duty (CENVAT and Service tax) and each register type. In the Balance Utilization group box, the system lists the amount due and the corresponding account from which the

amount is to be deducted. You can overwrite these fields if you want, and choose (Check) to check whether utilization is possible.

7. Save the excise invoice.

When you save the excise invoice, the system:

o Creates an accounting document that debits the accounts from which the excise duty or the service tax is

to be paid.

Account Debit Credit

CENVAT payable 150.00

Register RG 23A 50.00

Service Tax 100.00

o Generates entries in the Part II table for CENVAT payable. Based on the register used for utilization, the

system assigns the following entries:

A if RG23A is used for setting off the CENVAT payable

C if RG23C is used for setting off the CENVAT payable

P if PLA is used for setting off the CENVAT payable

S if Service tax credit is used for setting off the CENVAT payable

Excise Duty Utilization Use

When you create an excise invoice, the system allows you to display the information about the excise duty,

including which CENVAT accounts the excise will be debited to. To access this function, choose .

If a company defaults in the fortnightly payment of CENVAT, the excise collectorate can enforce an immediate payment of excise. Alternatively, you may have excess CENVAT credit and want to pay the duty immediately and not wait for a fortnight. This is also the case for some export removals where you claim the refund from DGFTA, in which case you need to pay the duty immediately.

Prerequisites

You can enable the immediate utilization of CENVAT, in Customizing for Logistics General, by choosing Taxes on Goods Movements India Basic Settings Maintain Series Groups.

Features

The information is shown in two group boxes:

Excise details

This shows you the excise invoice type, which you can change if necessary by choosing . It also shows you how much excise duty will be charged on the sale.

Balance utilization

This shows you which CENVAT accounts the excise duty will be debited to.

The system automatically proposes which CENVAT accounts it is to debit the excise duty to. It first takes the RG 23 accounts, and if there is not enough credit to cover it, it debits the remainder to the personal ledger account (PLA). The cess component of excise can only be taken from the PLA.

If immediate utilization is active for a series group, you can change the default utilization proposal. You can decide from which register to pay the amount. When you save the invoice, the system generates Part II entries in the appropriate registers. These excise invoices are not listed further during fortnightly payment of CENVAT.

If immediate utilization is off for the series group, the system proposes the excise duty values directly in the RG 23A fields, but the postings are made to intermediate accounts for excise duty. The system does not create any Part II entries. Entries are posted into a dispatch register. When you then run the fortnightly payment program, the system picks up these invoices and allows payment of CENVAT.

Excise Invoice Type Use

The excise invoice type denotes whether the goods are for the domestic market, or if they are for export, whether they are for export under bond, deemed export, or export under rebate. For more information about these processes, see Excise Bonding.

Features

In the system, when you set the excise invoice type, it controls:

How the excise duty is calculated

Which ARE documents you process the export with

Activities

When you come to create an excise invoice for an export sale, if you need to change the excise invoice type, follow this procedure:

1. ...

1. 1. Set the excise invoice type to Deemed, Bond, or No bond. 2. 2. Choose Calculate Tax.

The system recalculates the excise duty according to the excise invoice type (see below). To do so, it translates the

assessable value into the local currency as at the excise invoice date. What happens next depends on the excise invoice

type:

Exports under bond

The system sets the excise duty to zero and generates an outgoing excise invoice. It does not generate any entries for the Part II register.

The excise invoice is created with an export excise invoice number.

Deemed exports

The excise to be paid will be zero. This information will be used when the Part II registers are downloaded. When the system creates the excise invoice, it numbers it as a domestic excise invoice.

Nonbonded exports

The system applies the tax code defined in Customizing for Logistics General, under Taxes on Goods Movements India Basic Settings Determination of Excise Duty Maintain Excise Defaults, and calculates the excise duty as normal. Again, the excise invoice is created with an export excise invoice number.

Excise on Intercompany Billing Documents Use

The SAP System allows you to

create an excise invoice for intercompany billing documents.

For example, assume one company code places a sales order, and the goods are delivered to another. The first company has to create an excise invoice, in this scenario, with reference to the intercompany billing document

Duty Payable on Sale or Transfer of Capital Goods If a service provider receives a CENVAT credit on capital goods, upon sale or transfer of used capital goods, the service

provider must pay a percentage of the CENVAT credit for each yearly quarter after the credit was taken.

The system enables you to calculate the duty payable by the service provider for the capital goods. This duty is applicable

to used capital goods when sold or transferred.

Note

If the goods are transferred within the same financial year, then no duties are applicable.

End of the note.

Prerequisites

In order for the system to be able to determine which rate of excise duty to apply, you must have maintained all the data

on the Excise Rate Maintenance screen, which you can access from the SAP Easy Access screen by choosing Indirect

Taxes -> Master Data -> Excise Rate Maintenance. On this screen, under Master Data, select Material and Chapter-Id

combination.

For more information, see Vendor Master (Excise Data).

Features

When you post an invoice with a reduced amount at item level, the system:

Computes the number of quarters

It calculates the number of quarters that occur from the date you take the original credit until the date you sell or transfer

the goods.

Calculates the reduced duty accordingly

As a result, the recipient only pays for the reduced excise duties.

Activities

Create an excise invoice using Creating Excise Invoices and Other Outward Movements transactions at the item level,

and enter data as usual.

Canceling Excise Invoices Use

You follow this procedure in order to cancel an outgoing excise invoice. It reverses any excise duty accounted for.

Procedure

From the SAP Easy Access screen, choose Indirect Taxes Excise JV Create Cancel exc. inv. or Indirect

Taxes Sales and Outbound Movements Excise Invoice Create/Change/Display . Enter the number, year, and series group of the excise invoice that you want to cancel.

A dialog box appears.

Choose Yes. Save the adjustment posting.

SALES FROM DEPOTS J1IJ Purpose

You may sell finished goods directly from the place of manufacture, as described under Sales from Factories, or you may first ship them to a separate location for storage (a depot), from where you will sell them. The second procedure is described here.

Sales from depots are handled differently from sales from factories because of excise law: Excise duty is payable when you send the goods from the factory to the depot, but it is not levied again when you sell the goods.

Sometimes when you make a final sale of goods from a depot, price escalations could have happened with retrospective effect. In such scenarios you need to pay the extra excise duty at the factory using an A Certificate. You need to register the A certificate details in the RG23D register and the excise recovered from the customer.

Prerequisites

You have customized:

Stock transport processing, in Customizing for Materials Management (MM), by choosing Purchasing Purchase Order Set Up Stock Transport Order

The copying control for copying stock transport order NL to excise invoice JEX

Make this setting in Customizing for Logistics General, by choosing Taxes on Goods Movements India Business Transactions Outgoing Excise Invoices Assign Billing Types to Delivery Types.

The item category NLN (standard transport order) so that it is relevant for billing

You do this in Customizing for Sales and Distribution (SD), by choosing Sales Sales Documents Sales Document Item.

Process Flow

1. You create the sales order, following the standard procedure.

The standard pricing procedures for depot sales are JINDEP (condition-based excise determination) and JDEPOT (formula-based excise determination).

2. You create the delivery, again, following the standard procedure.

3. You assign excise invoices to the delivery or material document.

4. You verify that you have selected the correct excise invoices and post them. Alternatively, if you have selected the wrong excise invoices, you can cancel the assignment.

5. You create the invoice, following the standard procedure.

Creating Excise Invoices for Stock Transfers From the SAP Easy Access screen, choose Indirect Taxes Procurement Excise Invoice For Depot

Create/Change/Display.

In the Material document field, enter the goods receipt number and choose .

The system displays the information from the goods receipt, for example, the sending plant, the excise registration, the range, the division, and the collectorate.

Choose Details.

The system copies the items from the goods receipt document. In the depot it is possible to have a separate excise invoice at line item level.

Enter the internal document number of the excise invoice sent by the factory.

Choose more documents to go the excise invoice details screen. Enter the internal document number of the excise invoice from the factory.

The system copies the information to the line item (for example, the excise invoice number, the excise invoice date, the item number , the chapter ID, the excise invoice quantity, the amount of excise duty paid, the excise base value, and the serial number of the Part II register entry with which the excise was paid).

You can change the receipt quantity to match the actual quantity received at the depot, if necessary. The system automatically adjusts the excise accordingly.

Go back to the item details screen. Save the excise invoice.

The system creates an entry in register RG 23D.

Creating Excise Invoices for Direct Purchases From the SAP Easy Access screen, choose Indirect Taxes Procurement Excise Invoice For Depot

Create/Change/Display.

In the Material document field, enter the goods receipt number and choose .

The system displays the information from the goods receipt, for example, the sending plant, the excise registration, the range, the division, and the collectorate.

You can also maintain the excise registration details for the ship-from party, as for with the vendor. The ship-from can be different from the vendor code. (The delivering plant can be maintained as a ship-from in the system. When a valid ship-from is entered, the excise registration details copied from the vendor will be overwritten by the ship-from excise registration details.)

The ship-from registration details displayed can also be overwritten manually.

The dealer's commercial invoice number can be stored in the vendor excise invoice number, as in this case the dealer himself will not have an excise invoice.

Choose Details. The system copies the items from the goods receipt document. It also copies the vendor's excise invoice

number and the serial numbers of the entries in the RG 23A, RG 23C, and personal ledger account (PLA) registers.

Enter the internal document number of the excise invoice sent by the factory.

Select an item and choose More documents to go the excise invoice details screen.

In the case of direct purchases, there will not be any excise invoice in the system, so leave the internal document field blank. The vendor's invoice will show the details of the excise invoices through which excise has been paid for the item that is being dispatched. You can enter these details here.

For each item, the chapter ID, excise base value, and excise duty amounts are defaulted from the purchase order. You can change them if there is any difference. Enter the excise amount paid and the receipt quantity. You also enter the Part II register serial numbers with which the excise duty was paid and the excise registration information from the original excise invoice.

Go back to the item details screen. Save the excise invoice.

The system creates an entry in register RG 23D. You can change the excise invoice as long as it has not been used in any sales.

Creating Additional Excise Entries at Depots From the SAP Easy Access screen, choose Indirect Taxes Procurement Excise Invoice For Depot

Additional Excise Entry at Depot. In the Internal exc. inv. no. field, enter the internal excise invoice number at the depot along with the year,

and choose .

The system displays the information from the excise invoice which has already been created at the depot, including the excise group, vendor excise invoice number, ship from, and all the receipt against that excise invoice, highlighting the RG 23D folio and serial numbers.

An excise invoice item can have multiple A certificates attached to it. The A certificates will have the same folio number as the original line item, but the serial numbers will be different. A hierarchy icon differentiates the additional lines for an item line.

You can maintain the A certificate number, date, and additional BED, AED ,SED and CESS for a given RG 23D Folio.

After entering an A certificate you cannot delete the A certificate from the system, but you can change it until it is picked up during removals from the depot.

If some of the values in an A certificate are incorrect, you can make the values zero so that they do not have an impact on the final excise value.

Once an A certificate is used for removals then it cannot be changed. Save additional excise entry.

The system creates an entry in register RG 23D. Folio number generation must be active for you to make use of this supplementary invoice functionality at depot.

Assigning Excise Invoices to a Delivery Use

You follow this procedure to specify which excise invoices are to be assigned to a delivery from a depot (or other material document).

You can also automate this procedure, using the batch selection program (J_1IJCHK), by making the appropriate Customizing settings in the Country Version India (CIN) Implementation Guide (IMG).

Procedure

From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice For Depot Create/Change/Display Delivery or Material Document RG 23D Selection.

Enter the delivery document number or the material number and choose . Select the excise invoice you want.

Choose . Choose Excise invoice.

A list of excise invoices appears. These are the excise invoices at the depot with a balance quantity.

The system also shows a list of the A certificates that can be used. You can pick up any of the A certificates, but they must be for the same excise invoice. You can only pick up an A certificate in its entirety. You cannot select part of an A certificate.

Select the excise invoices that are relevant to the delivery. Specify what quantity to be used from each excise invoice. The system recalculates the excise accordingly. Go back to the item details screen. Save the data.

Result

The system creates an entry in register RG 23D and generates the depot excise invoice numbers.

If you selected any A certificates, the system also generates additional entries in the RG 23D register. The system marks the original A certificates as updated, so that they cannot be used for any other removals.

Verifying and Posting Excise Invoices Assigned to Delivery Use

You follow this procedure to verify that the correct excise invoices have been assigned to a delivery. If everything is correct, you can then post the delivery.

Prerequisites

You have selected which excise invoices are to be assigned to the delivery and have posted the goods issue.

Procedure

From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice For Depot Create/Change/Display Delivery or Material Document Verify/Post.

Enter the number of the delivery that you want to verify and choose . Make sure that the information is correct. Save the data.

The system updates the posting flag in the RG 23D register.

OTHER OUTWARD MOVEMENTS Use

In the standard procedure for creating outgoing excise invoices (see Sales from Factories), the excise invoice is created with reference to a delivery note or an invoice. The system also allows you to create an excise invoice with reference to various other documents, as follows:

Goods issue documents (for example, transfer postings) Vendor excise invoices (for when you return faulty goods to a vendor, for example) Factory excise invoice (for sales returns)

In addition, you can create an excise invoice without reference to any document at all.

Prerequisites

You have specified, per excise group, whether you want to create these excise invoices in one or two steps (see below). You do so in Customizing for Logistics General, by choosing Taxes on Goods Movements India Basic Settings Maintain Excise Groups.

You have also specified the maximum number of items allowed per excise invoice, in Customizing for Logistics General, by choosing Taxes on Goods Movements India Basic Settings Maintain Excise Registrations.

Features

Depending on your Customizing settings, you create excise invoices in a single step or in two steps, as follows:

In the two-step procedure, the excise clerk first creates the excise invoice, but no postings are made. An excise supervisor then verifies that the invoice is correct and, if so, posts it.

If the excise clerks are more experienced, you may want to use the one-step procedure, which is quicker, but more prone to error.

In this case, when you create an excise invoice, the system automatically posts it in the background.

Note that the functions for creating and canceling these excise invoices are different from those for other excise invoices.

Creating Excise Invoices Use

This is the procedure that you follow to create an excise invoice for the less common types of goods movement.

Procedure

1. From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice

For Other Movements Create/Change/Display (J1IS) . 2. On the selection screen, enter data as required, including:

o Reference group box

Specify which document you want to create the excise invoice for and which excise group it is for.

o Details group box

Specify the vendor or customer that you are sending the invoice to.

3. Choose .

If you entered an internal document number, the system copies the item details from it.

4. Choose . 5. Enter line items for each of the materials to be included in the excise invoice. For each item, enter the

following data: o Material o Quantity o Unit of measure o Base value o Excise duty

6. To pick the rate and amount from a specific excise invoice, choose Get excise invoice. 7. Save the excise invoice.

If you are using the one-step procedure, the system creates and posts an excise invoice. Otherwise, the system saves the information but does not make any postings: it now has to be verified.

Duty Payable on Sale or Transfer of Capital Goods If a service provider receives a CENVAT credit on capital goods, upon sale or transfer of used capital goods, the service provider must pay a percentage of the CENVAT credit for each yearly quarter after the credit was taken.

The system enables you to calculate the duty payable by the service provider for the capital goods. This duty is applicable to used capital goods when sold or transferred.

Note

If the goods are transferred within the same financial year, then no duties are applicable.

End of the note.

Prerequisites

In order for the system to be able to determine which rate of excise duty to apply, you must have maintained all the data on the Excise Rate Maintenance screen, which you can access from the SAP Easy Access screen by choosing Indirect Taxes -> Master Data -> Excise Rate Maintenance. On this screen, under Master Data, select Material and Chapter-Id combination.

Features

When you post an invoice with a reduced amount at item level, the system:

Computes the number of quarters

It calculates the number of quarters that occur from the date you take the original credit until the date you sell or transfer the goods.

Calculates the reduced duty accordingly

As a result, the recipient only pays for the reduced excise duties.

Activities

Create an excise invoice using Creating Excise Invoices and Other Outward Movements transactions at the item level,

and enter data as usual.

Verifying and Posting Excise Invoices Use

You follow this procedure to verify that the information in an excise invoice that has already been created, and to post it once you are satisfied.

Procedure

From the SAP Easy Access screen (J1ILN), choose Indirect Taxes Sales/Outbound Movements Excise Invoice For Other Movements Post Excise Invoice.

Enter the internal document number of the excise invoice. Choose Release to accounting.

The system displays the excise invoice. The excise duty that is to be posted is displayed at the foot of the screen, which you can change if necessary.

To access the balance utilization, choose . To display the balance available on the CENVAT accounts, choose Account Balances. Save the excise invoice.

The system generates the accounting documents.

To print the excise invoice, choose .

Canceling Excise Invoices From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice

For Other Movements Create/Change/Display . Enter the internal document number.

Choose .

A dialog box appears, asking you to confirm whether you want to delete the excise invoice.

Choose Yes.

Creating Excise Invoices for Stock Transfers Use

Follow this procedure to create an outgoing excise invoice for a stock transfer to another plant. For more information about this function, see

Other Outward Movements.

Procedure

From the SAP Easy Access screen, choose Indirect Taxes Sales/Outbound Movements Excise Invoice For

Other Movements Create/Change/Display . On the selection screen, enter data as required, including:

o Ref. doc. type:

MATD (Material document)

Doc. number:Transfer posting number Vendor:Leave this field blank Customer:The customer account number of the receiving plant

3. Choose .

The system copies the details from the transfer posting.

4. For each item: o Enter the net assessable value o Check and change the excise duty rates

5. Save the excise invoice.

If you are using the one-step procedure, the system creates and posts the excise invoice. Otherwise, the system saves the information but does not make any postings: it now has to be verified.

Making a Transfer Posting Use

In this procedure, you make a transfer posting for the goods ordered by another plant. For more information about

this function, see Entering the Removal from Storage at the Issuing Plant.

Procedure

From the SAP Easy Access screen, choose Logistics Materials Management Inventory Management Goods Movement Transfer Posting.

Choose Movement type Transfer posting Plant to plant To stock in transit. Enter the number of the issuing plant and storage location. Choose To purchase order. In the dialog box, enter the number of the stock transport order that the receiving plant created and choose

. Check the data. Save the transfer posting.

EXPORTS UNDER EXCISE REGULATIONS Use

Manufacturing plants are entitled not to pay any basic excise duty on export sales, as long as the goods are accompanied by an ARE document. The system handles AREs and the appropriate permit documents, such as export bonds and deemed export licenses.

The system does not handle exports to Nepal and Bhutan, which are subject to separate legislation.

Features

The system allows you to process three types of exports:

Exports under bond Exports under claim for rebate Deemed exports

You must create an ARE document for all goods that you export under these schemes. You use the same function to process all ARE documents. For information about how to use the function in general, and which features are common to all ARE documents, see ARE Documents.

Exports under Bond Use

One of the ways of exporting goods without paying basic excise duty is to obtain an excise bond from the excise authorities and then fill out an

ARE-1 document to go with every export.

Activities

Customizing

Carry out the IMG activities in Customizing for Logistics General, under Tax on Goods Movements India Business Transactions Exports Under Excise Regulations Exports and Printouts of ARE Documents.

Master Data

Enter your excise bonds in the system.

Day-to-Day Activities

In order to qualify for an exemption from excise duty, all exports must be accompanied by the appropriate paperwork, including an ARE-1 document, and you must complete the export within the export period. To process and track ARE-1s, use the ARE Documents functions, following the process described under ARE-1 Processing.

You can only issue an ARE-1 under a bond. The system automatically keeps track of the bond balance.

There are two ad-hoc reports that you can use for tracking bonds and ARE-1s: Bond Summary Report and Aging Analysis for ARE Documents.

Reporting

There are two statutory reports that you prepare at least once a month, Pro Forma of Running Bond Account and Statement Regarding Export of Excisable Goods.

Excise Bond Definition

Document, that effectively licenses a manufacturing plant to remove goods from its premises without paying basic excise duty, on condition that the goods are then exported.

An excise bond covers a fixed amount of excise duty. The excise duty of the goods exported under bond cannot exceed the bond value.

In the system, the term "excise bond" also covers letters of undertaking, and all of the excise bond functions apply equally to letters of undertaking, unless stated otherwise.

Use

Master Data

When you obtain a bond from the excise department, enter it in the system. The system numbers each bond automatically.

Day-to-Day Activities

When you assign an ARE-1 to a bond, the system automatically warns you of any reservations that have already been

made against the bond.

The system keeps track of the bond balance for you. When you post an ARE-1, the bond balance decreases automatically. In the case of running bonds, the balance increases again when you close the ARE-1.

Once an excise bond is no longer of any use to you, for example, if it expires or if you have exhausted a fixed bond, you can close it. This prevents any users from using it afterwards.

Reporting

You can use the system to prepare two statutory reports, the Pro Forma of Running Bond Account and the Statement Regarding Export of Excisable Goods. One further report, the Bond Summary Report, gives you an overview of all of

your bonds.

Bond Numbering Use

When you create an excise bond, the system automatically assigns it an internal bond number.

Each bond also has an official bond number.

Activities

Customizing

Maintain the number range object for the internal bond number in Customizing for Logistics General, by choosing Tax on Goods Movements India Tools Number Ranges.

Master Data

When you enter an excise bond, you enter the official bond number manually. When you save the bond, the system automatically assigns it a new internal bond number.

Bond Balance Use

Each excise bond only covers a limited amount of basic excise duty, the bond value. Every time you post an ARE-1, the system reduces the bond balance automatically.

Features

Every time you post an ARE-1 under a fixed bond, the system debits the excise duty stated on the ARE-1 to the bond, which reduces the bond balance. When the balance reaches zero, the bond is exhausted.

Running bonds, on the other hand, are automatically replenished: Once an export is complete and the excise department sends you confirmation that, the ARE-1 is correct, the system automatically credits the excise duty back to the bond (but see also Fast Credit).

You can check the bond balance at any time in the bond master or the Bond Summary Report. If you want to check the debits and credits on a running bond, use the Pro Forma of Running Bond Account.

Fast Credit Use

When you close an ARE-1 covered by a running bond, the system credits the excise duty back to the bond automatically.

However, some local excise departments may allow you to credit the excise duty back as soon as you receive the countersigned ARE-1 back from the customs department. This procedure is known in the system as fast credit.

Activities

Customizing

If you have a fast credit agreement with its local excise department, enter this information in Customizing for Logistics General, by choosing Tax on Goods Movements India Business Transactions Exports Under Excise Regulations Exports Make Settings for ARE-1 Procedure.

Day-to-Day Activities

If you do not have a fast credit agreement, the system credits the excise duty to the running bond when you close the ARE-1.

With fast credit, the system credits the excise duty back to the running bond when you enter the Arrived Back date (see Updating ARE-1s).

Reservations Use

The system records the total amount of excise duty from ARE-1s that you have created (but not yet posted) under a given bond.

This reservation amount is for information only. It serves to warn you, when you create an ARE-1, that other clerks have already created other ARE-1s under a bond and that they intend to post them under this bond as well.

Activities

When you create a new ARE-1 in the system, you specify which bond the ARE-1 is covered by. When you do so, the system displays the bond's reservation amount.

If the reservation amount is already over the bond balance, you might want to use a different bond, if another one is available. But since the reservation amount is for information only, the decision is up to you.

Processing Excise Bonds To access the individual functions shown in the table, from the SAP Easy Access screen, choose Indirect Taxes Master Data Excise Bond.

Function Follow-on menu path What you should know

Create an excise bond Create

Change an excise bond Change

Display an excise bond Display

Cancel an excise bond Cancel You can only cancel a bond if you have not yet used it.

Close an excise bond Close You must have closed all of the ARE-1s that the bond covers.

ARE-1 Processing Purpose

This procedure describes how you process ARE-1s for exports under bond.

Prerequisites

You have an excise bond from the government and have entered it in the system.

You have received a sales order from a customer located abroad. In the system, you have already created the delivery and the outgoing excise invoice. In the excise invoice, you have set the excise invoice type to Export Under Bond.

Process Flow

3. 1. The excise clerk creates an ARE-1.

He then calls the local excise department and asks them to send an excise officer to check the goods.

4. 2. The excise officer comes and checks that the goods match what is on the ARE-1. He fills out Part A of the form (Certificati