Balaji,
Taxes as you know are levied by the Givernment. Excise duty is levied by the Central Govt. in India and sales tax at the state level. There are different components in excise duty and sales tax and customs duty as well.
You need to understand exactly where and when they are levied and how.
E.D is a duty on manufacture. Thats why its also called output tax in most countries. It is applied at the time it leaves the factory gates at the time of delivery. In the olden days most factories use to have a central excise inspector posted near the gates of the factory to check the delivery and issue the excise Invoice. Even now in big factories theya re still there. Liquor is one where it is very tightly controlled this way.
Now over the years there has been some relaxation. For some items and some sectors you can even move a product to a depot without payment of excise duty. Technically you are supposed to pay it even it if you move it to a depot, But if you have prior permission this is allowed. In such cases e.d is payable when you move the goods out of depot at the time of delivery.
E.D contans components such as Basic excise duty, Addl ED, Special ED, NCCD, Education Cess etc.
Similarly with Sales tax. This is paid at the point of sale.
Customs duty is again paid at the border port when you im[ort the goods.
For all these there are detailed procedures based on Industry classification and area where the tarriff has been defined. There are some backward areas where there are tax holidays. there are products which enjoy a concessional rate of duty because of certain policy measures.
It all depends on so many factors ultimately traceable to the Government's Policies.
The government publishes a central excise manual periodically where it gives the E.D chapter by chapter. Similarly is the case with Customs duty and Sales taxes.
If you want more info on this please look up www.cbec.gov.in
Similar is the case with other countries.
regards
Jude
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