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In the recent past, Government has introduced many measures for simplification of Central Excise Rules and Procedures. Except Cigarettes, Self-assessment facility has been introduced in all Commodities in Central Excise. There is no provision in the rules for scrutiny of self-assessed returns. Accordingly, it is proposed to make scrutiny of such self-assessed returns part of the Central Excise Rules. This amendment will enable Board to prescribe systematic checks for scrutiny of returns.
In the CENVAT Credit Scheme, credit can be availed by manufacturers on the basis of documents that are self-certified. Checks are prescribed by way of selective audit. Presently, audit covers only manufacturers. A substantial amount of CENVAT Credit is routed through first stage and second stage dealers. Since there are no structured checks with regard to their transactions, it is proposed that on the lines of the Central Excise assessees, the dealers shall furnish a list of all the records with regard to receipt, purchase, storage, sales or delivery of the goods (inputs/ capital goods) to Central Excise Officer which may be subjected to selective audit.
With effect from 10th September, 2004, cross utilization of credit on inputs and input services has been permitted. It is therefore, essential to obtain access to the records maintained by the assessee in relation to payment, receipt and procurement of input services. Further, specific provision is being made to make all financial records including trial balance or its equivalent, available to Central Excise officer. Accordingly, amendments have been proposed in Central Excise Rules.
To monitor the defaults in monthly payment of duty, it is proposed that in cases of default in payment of full dues (including interest) beyond the grace period of one month, the facility of monthly payment of duty should be forfeited for a period of two months or till the payment of all dues, whichever is later and during this period, the assessee shall pay duty consignment-wise from account current alone. The present provisions are found to be inadequate to check such defaults in payment.
The above changes are proposed to be made effective from 1st April, 2005. Objections/ comments from the trade are invited regarding the proposed changes in Law. These objections/ comments may be sent by 21.3.2005 either by post to Shri Neerav Kumar Mallick, Under Secretary (CX 6), CBEC, Ministry of Finance or by e-mail to neeravkr@ nic.in. The draft rules are available on the CBEC web site, www.cbec.gov.in.
BSC/BY/GN-48/05
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