This note is applicable for customers using the tax procedure TAXINJ. Other terms
VAT and ECS value is not correctly considered for Octroi Base value calculation during Purchase order creation and J1IEX Capture.
Octroi Calculation in CIN, VAT condition, deductible VAT, Education Cess, ECS, JEC1, JEC2, Octroi condition base value, JOCM condition, routine 361, FV63A361, J_1I4_GET_DEDUC_TAX_FOR_OCTROI, J_1I4_STORE_DED_TAX_FOR_OCTROI,Sales Tax, FV64A352, Purchase order creation, ME21, Non-cenvatable material, Non-excisable material, Tax code with VAT, tax procedure TAXINJ Reason and Prerequisites
Incorrect octroi condition base value considered at the time of purchase order creation. Solution
Octroi condition base value calculation has to incorporate the value of VAT condition and ECS condition also.
Apply the code changes suggested in this note. In addition, for octroi the following setting have to be maintained in CIN customizing -
Octroi is applicable for a material which is not excisable but attracts VAT (deductable or non deductable) :
Here, the material will not attract any excise duties, but it will be subjected to VAT and Octroi will be calculated on the Base value of the material and the VAT. Hence, please do the following CIN customizing -
1. Maintain a dummy chapter id under the customizing 'Chapter-Id' in transaction J1ID and assign the material to this dummy chapter-id.
2. If the vendor of the material doesn't have an excise registration, then dummy excise details and a dummy excise indicator will have to be maintained for the vendor in transaction J1ID.
3. Maintain an entry for the material under the 'CENVAT Determination' customizing in J1ID transaction.
4. On the basis of the vendor excise indicator, plant excise indicator and chapter-id of the material, the excise rate for the material will have to be maintained. Since in this case the material is non-excisable, the excise rate will be maintained as zero.
5. Execute transaction FTXP and maintain the percentage rate of the tax condition which has been maintained as default for the 'A/P BED Condition Type' for tax procedure TAXINJ, as 100 percent for the tax code being used.
(The default tax condition maintained for the 'A/P BED Condition Type' for tax procedure TAXINJ can be found by checking the following configuration -
In transaction SPRO : Logistics-General -> Tax on Goods Movement -> India ->Basic Settings ->Determination of Excise Duty ->Maintain Excise Defaults.)