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Excise duties scenario-a special case!

Former Member
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Dear All,

I have a special case where two different units of the same company are working as seperate entities. They both are having seperate company codes and one unit U1 is Excisable and other U2 is non-excisable. These units are having a customer-vendor (where U2 is customer and U1 is Vendor)  relationship and they don't have Stock Transfer scenario.

Now here, in 'Free of Cost' scenario U1 creates a 'Free of Cost' Sales Order to U2 in which only the excise duties are to be paid and U1 is supposed to bear that cost of excise duties and should not impose it to U2.

My question is how this process can be mapped w.r.t. CIN in SAP and how the excise registers will update?

Kindly explain with the whole process flow.

Regards,

Ashu

Accepted Solutions (1)

Accepted Solutions (1)

Former Member
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Hi Ashutosh,

In U1 you are creating Free of cost sales order for U2 which is correct. Maintain separate pricing procedure for free of cost sales. In this pricing procedure maintain all excise duty and pr00 or assess able value condition types which you are using as base for calculation of excise. So that the values will not be posted in to accounting in VF01. As we are supposed to pay excise duty for government for free of cost sales also those excise duty values will be posted to accounting while creating excise invoice in J1IIN. For finished good sale you have to update RG1 register for receipts and issues.

Print the same on invoice as not for sale free of cost & send the invoice to customer.

Regards,

S.Himavanth.

Former Member
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Dear Himavanth,

As i have explained that both the unit U1 and U2 share a Customer-Vendor relationship and U1 has to bear the excise duty itself for the goods which they are delivering to U2 as Free of Cost. Hence, there is no question of sending the invoice to U2.

Regards,

Ashu

Former Member
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Hi Ashustosh,

No problem its not a matter whether u send invoice r not but you need to pay the excise duty to the government so, you have to pass those values to accounting J1IIN but not in VF01 as U2 is not paying so we need to keep statistical for excise duty condition types in free of cost pricing procedure as U1 is bearing the duties.

Hope it is clear now, let me know if any doubts.

Regards,

S.Himavanth.

Former Member
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Hi Ashutosh,

Maintain conditions for base price with ERS key and excise duties with EXD key in the pricing procedure. Assign accrual keys ERS to  Total of excise duties. So your excise registers will get updated as well as the same amount will enter your sales deductions account. Create billing document & then excise invoice.Excise invoice has to be created for internal records & excise formalities. You may not send it to customer if not required.  Similarly, RG1 will be updated.

Former Member
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Thanks for the reply Himavanth,

do you suggest to create a Proforma Invoice (JEX) in this scenario for creating Excise Invoice with its reference?

Please confirm!

Former Member
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Hi Ashutosh,

If VAT is not applicable means you can create with proforma invoice itsef. If VAT is applicable means you have to create normal commercial invoice in VF01 to pass those values to accounting. Check with the client if VAT applicable means how to knock off VAT amount that from customer outstandings as this is a free of cost sales. If it not applicable means then no problem.

Regards,

S.Himavanth.

Answers (3)

Answers (3)

Former Member
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Thanks to everyone for their valuable suggestions.

Special Thanks to Himavanth.

I am closing this thread!

Lakshmipathi
Active Contributor
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Since the amount should not be debited to U2, you can create a proforma so that there wont be any FI posting.  At the time of excise invoice creation, the amount should go to "Payable / Expense Account", ask FI consultant to share the related G/L Account and assign the same in "Specify G/L Accounts per Excise Transaction" under Logistics-General tab.

Not sure on this, but I guess it should work.

G. Lakshmipathi

jpfriends079
Active Contributor
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Discussion moved from SAP ERP SD Sales to Internationalization and Unicode

It is recommended to use space Internationalization and Unicode for all your CIN related queries.