INTRODUCTION

JCB PEDIGREE

Joseph Cyril Bamford launched the construction and agricultural equipment

manufacturing company that bears his initials, in 1945. He began his business in a garage

that measured 12 feet by 15 feet.

Today JCB’s world headquarters is one of the finest engineering factories in Europe. The

company that began as a ‘one man band’ now employs over 4000 people and produces

over 130 different models on a 4 different continents with bases in the UK, USA, INDIA

and SOUTH AMERICA.

It also sells a full range of equipment in over 150 countries. However, JCB’s remarkable

success story cannot be fully appreciated by studying a litany of statistics. JCB has an

ethos, a spirit and an identity that cannot be conveyed by facts and figures. Perhaps one

question and one dictionary definition might go some way to explaining why JCB is a

very special company.

The question: ‘How many global brands are still run as a family business?’

The dictionary meaning: JCB n Trademark. A type of construction machine with a

hydraulically operated shovel on the front and and an excavators arm on the back (named

from the initials of Joseph Cyril Bamford, its English manufacturer).

JCB is a unique company where unique people produce unique products, but it shares one

vitally important characteristic with many other successful global brands. It never stands

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still. JCB may have an exciting future because of its illustrious global but it never takes

anything for granted. It is constantly seeking new horizons.

Today’s successful businesses satisfy the need of their customers. Tomorrow’s successful

brands have to exceed their customer’s expectations. JCB is always looking for a better

way. It is always prepared to go that extra mile, always determined to do whatever it can

do to help its customers to do a better job.

The real JCB difference is that it is a global operation that is run like a family business. It

retains a sense of family and continuity within a highly sophisticated corporate structure.

It is a still family owned with no outside shareholders.

In the final analysis, JCB is not about machines. It is about people. People who believes

in business. In addition, in the product. People who consider themselves part of the JCB

family.

JCB is a company with basic belief in the merits of hard work. At the core of his modern

manufacturing giant is an old-fashioned work ethic. Nobody works harder on behalf of

his or her customers. Nobody tries harder to improve their products and their service.

JCB people believe their products are the best but they still want them to be better. That is

why JCB is unique.

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JCB’S PROMISE

We plan to deliver the best customer support in our industry- putting the customer at the

very heart of our business.

JCB INDIA LIMITED- A PROFILE

Company : JCB INDIA LIMITED

Product Range : Excavators Loaders

Front End Loaders

Articulated Loading Shovels

Tracked Excavators

Skid Steer Loaders

Models : Eleven

Equipment Population : Over 35000

Manufacturing location : Ballabgarh, Haryana

JCB INDIA Offices : 21

Dealership Outlets : 140

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JCB INDIA LIMITED £315 million manufacturer of earthmoving and Construction

Equipment is a fully owned subsidiary of JCB Excavators (UK)

J.C. Bamford Excavators Limited of United Kingdom is ranked in the top 5

manufacturers of earthmoving and construction equipment in the world and is considered

one of Britain most success stories. JCB is the world number one producer for backhoe

loaders.

JCB India Limited started operation in 1979 as a joint venture between the Escorts group

and JCB Excavators (UK). In 2003, JCB acquired 100% share and today JCB is the

fastest growing company in the Indian earthmoving and construction equipment industry.

The company is the pioneer in the industry and has recording excellent growth rates.

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 INTRODUCTION TO THE STUDY
The study was undertaken to know what exactly Invoice Verification, Bank Guarantee,

and Custom Duty is. How Invoice verification is done through ERP (SAP).

How custom duties are levied on the goods and the rates are specified in the schedules of

Custom Tariff Act, 1975.

WHAT THIS PROJECT INCLUDES:

This project depict clear understanding of functioning of Invoice Verification and

different rates used for calculation of Custom Duty. The term INVOICE

VERIFICATION means to review to improve accountability of state funds by

providing reasonable assurances that overpayments and erroneous billings are not

occurring with providers of services. And CUSTOM DUTY means tax imposed on

imports. They are used for restricting Imports for conserving foreign exchange.

This also gives overview of BANK GUARANTEE. Bank Guarantee is

an indemnity letter in which the bank commits itself to pay a certain sum if a third

party fails to perform or if any other form of default occurs. The data used is in this

project is Secondary Data and Sample Design is used.

This study has been conducted with the help of material and information

provided by the company and from company’s website.

Some limitation may be there in a study of this nature because some

confidential data may create problem. I have tried my best to explain the

concepts.

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 INVOICE VERIFICATION

Introduction

The cost-level of the invoice verification department has always been one that was under

pressure of a cost-cutting management team. Since the benefit to the company output is

low the most important criteria for this function has been to perform it as simple, accurate

and cheap as possible.

In the last 10 years, dramatic re-engineering in the area was hype in the consultant’s

world. With this, also the foundation was laid for software-solutions to facilitate these

new processes and make them less labour and/or error intensive. This SAP takes off on

the promise of the so called “don’t bill us we will credit you” .A process optimization

approach that builds on the potential of technical tools like document scanning, optical

character recognition and workflow software to streamline and cut costs in the area of the

invoice verification.

SAP DEFINITION OF INVOICE VERIFICATION

“The matching of document created during Purchase Order process, the goods

receipt process and accounts payable process which is an integral part of an

organization”.

ADVANTAGES

a. Enhanced Adaptability: Enhanced adaptability actually refers towards the

adaptability of SAP towards the existing Business System in any organization. It provides

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a heterogeneous environment, integrating the various applications; databases and making

available open technologies like web services readily available to the user. It saves money

on unnecessary customization of the existing business System.

c. Better ROI: SAP increases the return on investment. As mentioned earlier, by using

this technology IT strategies can be synchronized with SAP solutions. This

synchronization makes the system more reliable leading to better assessment services,

which in turn lead to financial benefits.

PROCESS DESCRIPTION:

When you receive a credit note for goods for which you have entered a purchase order

and carried out goods receipt and invoice verification on SAP, you will need to process

the credit note on SAP.

This User Guide explains how to process a credit note for items ordered, received and

Invoiced where there is a change in the price of the items to your advantage (i.e. no

change in the quantity of Items to be paid for). This Guide also explains how to process a

credit note for items ordered, received and invoiced where some items were sent back to

the vendor (i.e. a change in the quantity a of items to be paid for).

Note: SAP always expects the invoice to be processed before the credit note can enter.

Contents:

Section 1 of this document will take you through the detailed processes
required to verify a credit note.

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Section Contents

1.1 Accessing the Logistics Invoice Verification screen

1.2 Entering credit note data

1.3 Checking the vendor payee details

1.4 Verifying a Subsequent credit

1.5 Verifying a Credit memo

1.6 Simulating the posting of the credit note

1.7 Posting the credit note for payment

Procedure:

1.1 Accessing the Logistics Invoice Verification screen:

To access the screen to enter a credit note, follow the menu path: Logistics>

Materials Management> Invoice Verification> Logistics Invoice Verification or

use transaction code MIRO.

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1.2 Entering credit note data:

On the Invoice Verification screen, enter information as specified in the table

below:

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On the Invoice Verification screen, enter information as specified in the table below
Field Description User Action and Values Comments
Name
Transaction Subsequent credit or Select and enter either the Select the
Credit memo ‘Subsequent credit’ or ‘Credit ‘Subsequent credit’
memo’ transaction. transaction where
there is no change in
the quantity of items
to be paid for.
Select the ‘Credit
memo’ transaction
where there is a
change in the quantity
of items to be paid
for.

Invoice date The date of the credit Enter the date printed on the
note credit note
Posting date The date you are entering the This will default in as today’s
credit note date

Reference The credit note number Enter the credit note number
from the credit note here in the
same format as it is on the
document
Entering the credit
note number in the
same format will
make it easier if you
need to refer to/find it
again at a later date

Amount The total of the credit note The total amount of the credit
note including tax.
Tax The tax amount The tax portion of the credit note

Calculate Don’t put anything in here

tax
Tax code Don’t put anything in here

Purchase The purchase order The purchase order number from

order/sched number when you placed the order.
uling If the credit note refers to several
agreement purchase orders, the several
purchase order numbers can be
entered by clicking on the ‘More
allocation criteria’ yellow arrow.
PRESS ENTER

1.3 Checking the vendor payee details:

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You will see the vendor number for the vendor that the purchase order was raised against

and the name and address of the vendor default into the screen:

If the credit note is from a different vendor to the vendor entered on the purchase order

and the original invoice was verified with this different vendor as an alternative payee,

then enter the different vendor on the credit note as an alternative payee on the details tab.

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If you are entering a ‘Subsequent credit’, i.e. paying less for items with no change in the

quantity of items to be paid for, proceed to Section 1.4.

If you are entering a ‘Credit memo’, i.e. a change in the quantity of items to be paid for,

proceed to Section 1.5.

1.4 Verifying a Subsequent credit:

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By following Sections 1.1, 1.2, and 1.3, details of the line items will have defaulted into

the screen from the original purchase order.

Enter the net amount of the credit against the appropriate line items.

Note: a credit note cannot be for more than the amount already invoiced.

Select the lines that the credit refers to by clicking on the boxes to the left of the items so

that they are a darker shade of grey.

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Proceed to Section 1.6 to simulate the posting of the Credit memo.

1.5 Verifying a Credit memo:

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By following Sections 1.1, 1.2, and 1.3, details of the line items with their net prices will

have defaulted into the screen from the original purchase order. Each line will be

selected, indicated by the box to the left of each line being a darker grey.

Click on the amount to be altered and enter the net amount of the credit.

Click on the quantity to be altered and enter the quantity of the item on the credit note.

Note: a credit note cannot be for more than the amount or quantity already invoiced.

De-select the lines that the credit does not refer to.

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Proceed to Section 1.6 to simulate the posting of the Credit memo.

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1.6 Simulating the posting of the credit note:

Click on the ‘Simulate’ button to view the document you are about to post.

The ‘Simulate Document in GBP’ box shown below should appear.

In this screen, check the following:

 Each of your line items should be against its ledger code; nothing should be assigned

to G/L account 91250.

 The Debit should equal the Credit, and the Balance at the bottom should be 0.00.

If the simulation is correct, proceed to Section 1.7 to post the credit note.

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If the simulation is not correct, go back to the Invoice Verification screen by clicking on

the ‘Back’ icon and make your corrections.

When simulating the posting of the credit note, if the warning message ‘Invoice

document still contains messages (see error log) appears, see Section 1.8

1.7 Posting the credit note for payment:

Click on the save button to post the credit note for payment.

This takes you back to the Invoice Verification screen ready for the next invoice/credit

note. The document number is given at the bottom of the screen. Every time SAP carries

a function, it creates a unique document number within a range. The number range for

invoice/credit note verification starts with 51…

Use the rubber stamp on the invoice and write in the document number SAP produces in

the box marked ‘Document no’ and obtain the appropriate signature to authorize the

credit note.

Send the verified and authorized credit note to the payments office

1.8 Processing error messages:

When simulating the posting of a credit note (Section 1.6), if the warning message,

appears instead of the simulate screen, follow the path: Goto> Messages. Note the

Verification log Message text, ‘Enter’ to return to the Invoice Verification screen and

make the appropriate change to the verification entry.

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 BANK GUARANTEE

Definition

BANK GUARANTEE is a written promise issued by the Bank to compensate (pay a

sum of money) to the beneficiary (third party, local or foreign) in the event that the

obligor (customer) fails to honor its obligations in accordance with the terms and

conditions of the guarantee/agreement/contract.

Purpose

Foreign Bank Guarantee

This guarantee is issued at the request of a correspondent bank in favor of local

companies that organize international bids or foreign suppliers.

Local Bank Guarantee

This is issued by the Bank at the request of contractors, wholesalers, companies involved

in transaction, etc. for handling the guarantee request they receive in their operation.

Types of Letters of Guarantee

Advance Payment Guarantee

This is issued by the Bank in favor of a buyer who makes the advance, at the request of

the seller/contractor who received the advance, representing the Bank's commitment to

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repay the sum in the event that the seller/contractor fails to honor the contract terms in

their entirety or in part.

Suppliers' Credit Guarantee

Such guarantee is issued by the Bank to meet any claims to be made by the local or

foreign supplier (beneficiary) in case the debtor (local buyer) fails to repay in accordance

with the terms and conditions of the contract.

Retention Guarantee

Such guarantee is issued by the Bank to provide security to the party accepting the

release of the retention (beneficiary) in the event that the seller or the contractor fails to

perform its obligation as per the term and conditions of the contract.

Bid Bond Guarantee

Bid bond is issued by the Bank upon the request by the bidder expressing the Bank's

commitment to meeting the claim of the beneficiary in case the bidder withdraws from

the bid during the bid period or fails to accept the award when he/she becomes a winner.

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Customs duty guarantee

These guarantees are issued by the Bank to meet the requests of the beneficiary in respect

of customs duties in circumstances where the goods imported without payment of

customs duties are not re-exported and the respective customs duties have not been paid.

Eligibility

 The Bank provides guarantee services to both local and foreign customers.

 The beneficiary of the guarantee could be an individual or business located locally

or abroad.

 Issuance of guarantee by the Bank to foreign beneficiaries is done after obtaining a

foreign currency permit from the National Bank of Ethiopia (NBE).

Duration

 the duration of a guarantee is dependent upon the contractual agreement made

between the parties involved in the guarantee contract.

 Any request made after the expiry of the guarantee is not accepted.

 The Bank shall not commit itself to the terms and conditions stated in the

contractual agreements.

Collateral

 A letter of guarantee is issued against acceptable collaterals.

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Customer’s obligation

 Customers have to fulfill their obligation as per the terms and conditions of the

contract.

 If they fail to do so, the beneficiary is entitled to collecting the guarantee amount

from the Bank before the expiry of the guarantee.

Service Charge

The Bank collects a service charge of 0.2% to 0.5%, depending on the amount of

guarantee and its duration

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 CUSTOM DUTY

Brief Background of Customs Law

Customs duty is import into India and export out of India.

Problems due to high customs duty - Heavy customs duty had started becoming

counter-productive. Indigenous industries, protected from foreign competition, became

self-complacent. They neglected aspects of quality and productivity. The result is that

‘Made in India' label has become a sign of poor quality product in international market.

Productivity of Indian Industry in many cases is as low as 20 to 30% of comparable

industries abroad. Indian exports are restricted in some countries due to our protectionist

policies. Government has realized these aspects. Restrictions on imports have been

considerably reduced. Rupee has been made freely convertible on current account.

Customs duties were lowered to 150% (basic plus auxiliary) in 1991. It was brought to

110% in March 1992, 85% in March 93, 65% in March 94, and 50% in March 95 and

42% in March 1997. [40% basic plus 2% special]. The peak rate was brought down to

38.5% in March 2000 (35% basic plus 10% surcharge). It was brought down to 35% on

1.3.2001, 30% on 1-3-2002, 25% w.e.f. 1-3-2003 and 15% w.e.f. 1-3-2005.

CVD / SAD IN ADDITION TO BASIC CUSTOMS DUTY - In addition to basic

customs duty, Special Additional Duty of 4% (SAD) and Countervailing duty (CVD)

equal to excise duty is also payable.

Scope and coverage of Customs Law

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Section 12 of Customs Act provides levy of duty on Imports as well as exports. The rate

of duty is as prescribed in Customs Tariff Act, 1975, read with relevant exemption

notifications. Import duty is levied on almost all items, while export duty is levied only

on a few limited products, where Indian goods are in commanding position. Raising

revenue for Central Government is the main but not the only purpose of Customs Act.

Customs Act is used to (a) regulate imports and exports (b) protect Indian industry from

dumping (c) collect revenue of customs duty. In addition, provisions of Customs Act are

used for other Acts like Foreign Trade (Development and Regulation) Act, Foreign

Exchange Management Act (FEMA) etc. Customs Law is covered under various Acts,

rules, regulations and notifications, as follows:

CUSTOMS ACT, 1962 - This is the main Act, which provides for levy and collection of

duty, import/export procedures, prohibitions on importation and exportation of goods,

penalties, offences etc.

CUSTOMS TARIFF ACT, 1975 - The Act contains two schedules - Schedule 1 gives

classification and rate of duties for imports, while schedule 2 gives classification and

rates of duties for exports. In addition, the CTA (Customs Tariff Act) makes provisions

for duties like additional duty (CVD), preferential duty, anti-dumping duty, protective

duties

TYPES OF DUTIES

Under the custom laws, the following are the various types of duties, which are leviable.

Basic Duty:

This is the basic duty levied under the Customs Act. The rate varies for different items

from 5% to 40%.

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Additional Duty (Countervailing Duty) (CVD):

This additional duty is levied under section 3 (1) of the Custom Tariff Act and is equal to

excise duty levied on a like product manufactured or produced in India. If a like product

is not manufactured or produced in India, the excise duty that would be leviable on that

product had it been manufactured or produced in India is the duty payable. If the product

is leviable at different rates, the highest rate among those rates is the rate applicable. Such

duty is leviable on the value of goods plus basic custom duty payable. e.g. If the customs

value of goods is Rs. 5000 and rate of basic customs duty is 10% and excise duty on

similar goods produced in India is 20%, CVD will be Rs.1100/-.

Additional Duty to compensate duty on inputs used by Indian manufacturers. This

Additional Duty is levied under section 3(3) of the Customs Act. It can be charged on all

goods by the central government to counter balance excise duty leviable to raw materials,

components and other inputs similar to those used in the production of such good.

Anti-dumping Duty:

Sometimes, foreign sellers abroad may export into India goods at prices below the

amounts charged by them in their domestic markets in order to capture Indian markets to

the detriment of Indian industry. This is known as dumping. In order to prevent dumping,

the Central Government may levy additional duty equal to the margin of dumping on

such articles, if the goods have been sold at less than normal value. Pending

determination of margin of dumping, such duty may be provisionally imposed. After the

exact rate of dumping duty is finally determined, the Central government may vary the

provisional rate of dumping duty. Dumping duty can be imposed even when goods are

imported indirectly or after changing the condition of goods. There are however certain

25
restrictions on imposing dumping duties in case of countries which are signatories to the

GATT or on countries given "Most Favored Nation Status" under agreement. Dumping

duty can be levied on imports on such countries only if the Central Government proves

that import of such goods in India at such low prices causes material injury to Indian

industry.

Protective Duty:

If the Tariff Commission set up by law recommends that in order to protect the interests

of Indian industry, the Central Government may levy protective anti-dumping duties at

the rate recommended on specified goods. The notification for levy of such duties must

be introduced in the Parliament in the next session by way of a bill or in the same session

if Parliament is in session. If the bill is not passed within six months of introduction in

Parliament, the notification ceases to have force but the action already undertaken under

the notification remains valid. Such duty will be payable upto the date specified in the

notification. Protective duty may be cancelled or varied by notification. Such notification

must also be placed before Parliament for approval as above.

Export Duty:

Such duty is levied on export of goods. At present, very few articles such as skins and

leather are subject to export duty. The main purpose of this duty is to restrict exports of

certain goods. The Central Government has been granted emergency powers to increase

import or export duties if the need so arises. Such increase in duty must be by way of

notification, which is to be placed in the Parliament within the session, and if it is not in

session, it should be placed within seven days when the next session starts. Notification

should be approved within 15 days.

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 OBJECTIVE OF STUDY

 To study in detail the concept of Invoice verification

 To study what is the concept of Bank Guarantee, Custom Duty

 The objective of Invoice Verification is to review to improve accountability of state

funds by providing reasonable assurances that overpayments and erroneous billings

are not occurring with providers of services

 To ensure that accounts for payment and settlement are verified in a cost-effective

and efficient manner while maintaining the required level of control.

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 RESEARCH METHDOLOGY

Research in common refers to “search for knowledge”. It is scientific system and for

pertinent information on specific topic. It may be understood as a science of

studying how research is done scientifically.

RESEARCH DESIGN

Research Design is a framework in which research resides. The research opted is

EXPLORATORY. It is of flexible nature. It is based on secondary data. So researchers

have to adjust them according to changing environment. The rate of custom duty depends

upon the policy of government. The adoption of software depends upon the decision of

the manufacturer.

SAMPLE DESIGN

A sample is representative of whole population. Researchers while conducting research

has to draw certain sample for study purpose. A sample design is a definite plan

determined before any data are actually collected for obtaining samples for the same

study. Sample design of my study is random sampling.

DATA COLLECTION

The data is of two types: primary and secondary. Data are the facts presented to the

researcher from the study of environment.

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 DATA

PRIMARY SECONDARY
DATA DATA

 PRIMARY DATA in this research was collected through continuous meeting with

employees.

 SECONDARY DATA was collected through websites of company.

After the collection of data, it is edited and edited data is put into a form

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 ANALYSIS AND INTERPRETATIONS

INVOICE VERIFICATION

In SAP, three types of bills are passed:-

o excluding freight

o including freight

o job work only

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 INVOICE (VALID FOR INPUT TAX)

TUBEWELL WORKSHOP & GENERAL

INDUSTRIES
INVOICE NO. 544 DATE 15-06-2006
PURCHASE ORDER NO. 6200000197
CONSIGNEE:
M/S JCB INDIA LTD.
23/7 MATHURA ROAD, BALLABGARH
FARIDABAD (HARYANA)

S PART NO. DESCRIPTION QTY. UNIT VALUE BED

NO. RATE Rs. P. Rs. P.
1. 1690 DOUBLER 22 489.60 10771.20 1723.40
40/301701 PLATE
2. 1700 DOUBLER 22 489.60 10771.20 1723.40
40/301702 PLATE
3. 1750 REINFORCING 22 235.20 5174.40 827.91
40/301706 PLATE
4. 1760 REINFORCING 22 235.20 5174.40 827.91
40/301707 PLATE

Total price in words TOTAL VALUE 31891.20

THIRTY EIGHT THOUSAND FIVE HUNDRED
SEVENTY NINE & PAISE SEVENTY ONLY. 16% 5102.62
Cess 2%on excise 102.05
37095.87
HGST 4% 1483.83
G.TOTAL 38579.70

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 TAX INVOICE

PANCHAL MANUFACTURING CO.PVT.LTD.

36A, Industrial Area, N.I.T Faridabad-121005, India

NAME&ADDRESSOF CONSIGNEE INVOICE NO. 894

JCB INDIA LTD. DATE OF ISSUE 17-06-2006
23/7, MATHURA ROAD,
BALLABGARH
FARIDABAD, HARYANA

S. NO. PART NUMBER DESCRIPTION QTY. ASSESSABLE

OF GOODS RATE PER VALUE
UNIT
1. 40/301916 10 G.A. BUCKET 15 120.00 1800.00
LINK NOS

JOB WORK

Total invoice value in words

Rs.ONE THOUSAND EIGHT HUNDRED ONLY

TOTAL INVOICE VALUE 1800.00

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 INVOICE

SAKET HARDWARE INDUSTRIES INVOICE NO. 1399

PLOT NO.94 , SEC 59, HSIDC INDUSTRIAL ESTATE DATE 19-06-2006
BALLABGARH, FARIDABAD RATE OF DUTY 16.00%

S. NO. PART NO. DESCRIPTION OF QTY. RATE ASSESSABLE

GOODS VALUE
4220 335/04060 WA GRILL HOUSING 32 1168.20 37382.40

4250 40/302456 SIDE PANEL 32 174.74 5591.68

4260 40/302457 SIDE PANEL RH 32 174.74 5591.68

4290 40/302258 FAN COWL 8 386.10 3088.80

4610 40/302821 J BOLT 100 3.39 339.00

4660 125/00456 HOSE GUIDE L 10 51.01 510.10

4670 125/00457 HOSE GUIDE R 10 51.01 510.10

TOTAL VALUE IN WORDS SUB TOTAL 53013.76

SIXTY FOUR THOUSAND ONE HUNDRED THIRTY CENVAT@16% 8482.21
TWO ONLY CESS @ 2% 169.64
TAXABLE TOTAL 61665.61
V.A.T 2466.62
ROUND OFF -0.23
G. TOTAL 64132.00

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 TUBEWELL WORKSHOP $
GENERAL INDUSTRIES
S.NO. 527 DATE 12-06-2006
______________________________________________________________________________

CONSIGNEE
M/S JCB INDIA LTD
23/7, BALLABGARH
FARIDABAD, HARYANA

S. PART NO. DESCRIPTION QTY. UNIT VALUE BED

NO. RATE Rs. P. Rs. P.
1. 960 629/00137 LH FLOOR EXT. PLATE 5 555.8 2779.00 444.64
2. 1040 696/00705 RH FLOOR EXT. PLATE 5 440.90 2204.50 352.72
3. 1100 696/01390 W.A. CRADLE 1 12667.00 12667.00 2026.72
4. 1110 696/01402 FLY WHEEL ADAPTOR 4 2728.00 10912.00 1745.92
5. 1130 JAV0074 LINK ARM RH 1 623.80 623.80 99.81
6. 1140 JAV0075 LINK ARM LH 1 810.00 810.00 129.60
7. 1150 JAV0076 BUCKET LINK 1 2648.00 2648.00 423.68
8. 1490 40/301760 LH LATCHBOOM LOCK 32 106.03 3392.96 542.88
9. 1500 40/301761 RH LATCHBOOM LOCK 32 106.03 3392.96 542.88
10. 1790 40/302438 CROWD LEVER 34 320.13 10884.42 1741.51
11. 1800 40/302439 INTER LEVER 34 561.45 19089.30 3054.29

TOTAL PRICE IN WORDS TOTAL 69403.94

EIGHTY FIVE THOUSAND NINE HUNDRED FIFTY VALUE
NINE $ PAISE NINETY ONE ONLY 16% 11104.65
cess@2%on excise 222.09
80730.68
HGST 4% 3229.23
FREIGHT 2000.00

G. TOTAL 85959.91

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 BANK GUARANTEE

BANK GUARANTEE is a written promise issued by the Bank to compensate (pay a

sum of money) to the beneficiary (third party, local or foreign) in the event that the

obligor (customer) fails to honor its obligations in accordance with the terms and

conditions of the guarantee/agreement/contract.

JCB INDIA LTD. Arranges Bank Guarantee of various banks. They maintain Bank

Guarantee information in MS-EXCEL.

It includes BANK GUARANTEE NO., PARTY NAME, AMOUNT, EXPIRY

DATE, BANK NAME.

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 PREPARATION OF BANK GUARANTEE IN MS-EXCEL

BANK GUARNTEE NO PARTY NAME AMOUNT EXPIRY DATE BANK NAME

M/S TAL MANUFACTURING

SOLUTIONS LTD 546000 30.09.06 UNION BANK OF INDIA
0005BA00015006 M/s.CONVEX AVIO PVT LTD 1164300 30.06.06 1CICI BANK LTD.
34/06 M/S SIMA LABS PVT LTD 37000 27.10.06 CANARA BANK
M/S SUDHIR GENSETS
163/06 LIMITED 633600 23.07.06 SYNDICATE BANK
M/S SUDHIR GENSETS
162/06 LIMITED 738000 23.07.06 SYNDICATE BANK
6022IPEBG060017 M/S ACTIVENT ENGINEERING 735000 15.10.06 BANK OF INDIA
M/S HIND HYDRALUCIS &
6700:FG:2006:582 ENGINEERS 442500 17.06.06 BANK OF INDIA
M/S CHICAGO PNEUMATIC
5606066506 SALES 142500 18.12.06 CITI BANK N.A.
M/S HIND HYDRALUCIS &
6700:FG:2006:567 ENGINEERS 95000 05.02.07 BANK OF INDIA
M/S JOST'S ENGINEERING
COMPANY LIMITED 96000 30.09.06 SOUTH BANK INDIA LIMITED
M/S GRIP ENGINEERS PVT
37:05:00 LTD. 219000 31.12.06 MERRADPALLI, SECUNDERABAD
M/S CARYAIRE EQUIPMENTS
0220/00000732 INDIA PVT LTD. 55900 10.01.07 UTI BANK LTD.
M/S GRIP ENGINEERS PVT
37/05 LTD. 219000 31.12.06 CANARA BANK
2005/24 M/S UBIQUE SYSTEM 164758 20.06.06 BANK OF BARODA
M/S TAL MANFACTURING
SOLUTIONS LTD. 1110000 31.03.06 UNION BANK OF INDIA
M/S TAL MANFACTURING
SOLUTIONS LTD. 9510000 27.10.06 UNION BANK OF INDIA
0302406BG0000022 M/S BHARAT FRITZ 397448 05.02.06 STATE BANK OF INDIA
1LG 1805 M/S H.S.TOOL ROOM CENTRE 60000 15.02.06 PUNJAB NATIONAL BANK
0302405BG0000612 M/S BHARAT FRITZ 280000 31.12.05 STATE BANK OF INDIA
2005/243 M/S VOLTAS LTD. 97500 24.08.06 STATE BANK OF INDIA
M/S SKG PNEUMATICS 33679 25.05.06 COORPORATION BANK
550-02-0326839 M/S MAKINO ASIA PTE LTD 4425000 24.12.05 DBS BANK LTD
550-02-0329382 M/S MAKINO ASIA PTE LTD 4425000 26.12.05 DBS BANK LTD
D1111ilg M/S H.S.TOOL ROOM CENTRE 45500 30.06.06 PUNJAB NATIONAL BANK
M/S INGERSOLLSOLL-RAND
5545284504 WADCO TOOLS PVT. LTD 119920 10.10.06 CITI BANK N.A.
SAP (UK) LTD 31.04.09
0302405BG0000532 M/S BHARAT FRITZ 1900000 31.08.06 STATE BANK OF INDIA
0302405BG0000513 M/S BHARAT FRITZ 1070000 07.09.05 STATE BANK OF INDIA

36
 CUSTOM DUTY

Customs duty is on import into India and export out of India

PREPARATION OF CUSTOM DUTY IN MS-EXCEL

ASSESSABLE
QTY RATE AMT VALUE BCD CVD CESS TOTAL CESS ADD. DUTY

2 45 90 14060.56184 1757.5702 2530.901 50.618023 86.78178768 739.4573205

20 8.2 164 25621.46824 3202.6835 4611.864 92.237286 158.135702 1347.455562
50 67.19 3359.5 524849.5278 65606.191 94472.92 1889.4583 3239.371286 27602.29854
25 3.77 94.25 14724.53282 1840.5666 2650.416 53.008318 90.87981655 774.3761384
5 9.46 47.3 7389.60639 923.7008 1330.129 26.602583 45.60865064 388.6259029
50 5.73 286.5 44759.45519 5594.9319 8056.702 161.13404 276.2553575 2353.939137
8 33.03 264.24 41281.80957 5160.2262 7430.726 148.61451 254.7913286 2171.046693
6 9.74 58.44 9129.991489 1141.2489 1643.398 32.867969 56.35030747 480.1542868
3 103.14 309.42 48340.21161 6042.5265 8701.238 174.02476 298.3557861 2542.254268
3 46.04 138.12 21578.27557 2697.2844 3884.09 77.681792 133.1811168 1134.820501
4 17.47 69.88 10917.24513 1364.6556 1965.104 39.302082 67.38123693 574.1475284
160 0.91 145.6 22746.86449 2843.3581 4094.436 81.888712 140.3936476 1196.277621
6 10.18 61.08 9542.434636 1192.8043 1717.638 34.352765 58.89590657 501.8450349
20 10.25 205 32026.8353 4003.3544 5764.83 115.29661 197.6696275 1684.319452
20 6.23 124.6 19466.06673 2433.2583 3503.892 70.07784 120.1445638 1023.737579
4 11.63 46.52 7267.748187 908.46852 1308.195 26.163893 44.85654181 382.2172728
10 19.01 190.1 29699.03118 3712.3789 5345.826 106.91651 183.3024204 1561.898185
8 11.33 90.64 14160.54806 1770.0685 2548.899 50.977973 87.39890262 744.7156837
5745.19 939743.9 112195.28 161561.2 3231.224 5539.753986 47203.5867
329731.04

JCB INDIA LTD CALCULATES THE FOLLOWING

DUTIES

BCD = ASSESSABLE VALUE * 12.5%

37
CVD = (ASSESSABLE VALUE + BCD) * 16%

CESS = CVD * 2%

TOTAL CESS = (BCD + CVD + CESS) * 2%

ADDITIONAL DUTY= (ASSESSABLE VALUE+BCD + CVD + CESS+ TOTAL

CESS)* 4%

38
 CONCLUSION

Invoice verification through SAP provides a complete solution to standard business

requirements. It results in:

39
 enhanced adaptability

 better ROI

Bank guarantee

 Develop trust needed by your business associates.

 Facilitate your business activities

Custom duty increases the competitiveness of Domestic industry

SUGESSTIONS

Successful implementation of SAP will result in tremendous cost savings and

increased productivity.

40
 Import of all packaged commodities should be made subject to compliance of all

the conditions of the Standards of Weights and Measures (Packaged Commodity)

Order 1977, as applicable on domestic producers.

Rate of Custom duty should be set within the limit.

LIMITATIONS

1. Complex nature of SAP.

2. Limitation of remembering too many codes in SAP.

41
 3. High rate of Custom Duty reduce the competitiveness of industry in

International market.

4. Fulfillment of legal formalities for undertaking Bank Guarantee.

CUSTOM DUTY CERTIFICATE

525830

42
 Citibank MC / DD / FT
APPLICATION

Date____________________
To: OIC, Cash Management, Citibank N.A., □ Ahmedabad □ Bangalore □ Chandigarh □ Chennai
□ Coimbatore ◙Delhi □ Gurgaon □ Hyderabad □ Jaipur □ Kochi □ Kolkata
□ Ludhiana □ Mumbai □ Pune □ Vadodara

Applicant: ________________ JCB INDIA LTD___________________Account No_______1040006

Please arrange to issue the following as per details below:

□ Pay Order / Manager’s check □ Demand Draft □ Funds Transfer (for Metros only)
□ The instrument is to be
◙ Collected by our representative from Citibank Mr. Puneet Kaushik
□ Delivered to. (Please give the complete address_______________________________________________
_________________________________________________________
_________________________________________________________

□ The fund are to be credited to account no______________with_____________Bank at____________Branch

in______________________________________________________________________________________

Payment Details
Sr No. Beneficiary Location Amount
1. PNB A/C CUSTOM DUTY A/C JCB INDIA LTD. NEW DELHI 750418.00
2. ……………………DO……………………………. …….DO………. 17029.00

Total amount 767447.00

(In Words) Seven Lacs sixty seven thousand four hundred forty seven only ……………………..
……………………………………………………………………………………………………….
Reimbursement Instruction
□ Debit our account no ___________1040006___________for principal and charges.
□ Find enclosed funding check for Rs._________________for amount as well as charges.
___________________________________________
Authorized Signatory with Co. Stamp

CITIBANK PAYS THE CUSTOM DUTY ON BEHALF OF JCB INDIA LTD

BIBLIOGRAPHY
43
 www.jcb.com

 www.google.com

 www.thespot4sap.com

 www.yahoo.com

 RESEARCH METHDOLOGY by C.R.KOTHARI and G C BERI

44