04 December 2016
Circular on ;OIDAR
19 October 2016
CBEC ON EPCG
CBEC Instructions for Rationalization of procedures reg. handling exporters obligations under EPCG authorizations
The CBEC has instructed to further rationalize the procedures reg. handling exporters obligations under EPCG authorizations to ensure transparent random selection criteria and selection for 5% check being made at least at Joint/Additional Commissioner level and the relevant exporter being invariably informed, on the date of selection itself, via official email communication that its case is selected for detailed checks. Also CBEC has reiterated to ensure credibility and transparency in the Bond cancellation process by making the process speedier and that the exporter should not be asked to routinely produce information that can be sourced from the Customs EDI system.
CBEC Instructions dt. 14 Oct. 2016 F.No.605/71/2015-DBK
1. The undersigned is directed to say that as a part of further rationalizing procedures and avoiding duplication of work based on feedback on outcomes of applying extant procedures, taking into account the conditions prescribed in the Foreign Trade Policy and Customs notifications, the Board reviewed certain aspects of the directions given to field formations in Circular No. 5/2010-Cus, Instruction No. 609/119/2010-DBK dated 18.01.2011 and Circular No. 14/2015-Cus insofar as they relate to EPCG scheme. The details are given in succeeding paragraphs.
2. At present the correctness of the installation certificates issued by Chartered Engineers are to be verified on random basis in at least 5% cases through the Central Excise Division. The Board has decided that this verification be restricted to 5% cases.
3A. In the Circular of 2010 it was prescribed that first block EO (export obligation) should be verified in detail and if it has been found satisfactory then EODC issued at end of second block should be accepted without further verification. The Instruction of 2011 confirmed that this is to be implemented; however, for past cases where exporter had not come forward for first block verification but had submitted the EODC, the EODC may be accepted subject to random verification of at least 5% of EODCs issued in such past cases. It further directed that the Customs check, in detail, at least 5% EODCs. In this connection, it was noted that not meeting the block-wise EO attracts composition fees or payment of duty with interest and this find mention in HBP and is also referred in Customs notifications.
3B. On consultation, the DGFT has informed that the provisions of para 5.14 of HBP 2015-20 that provides
"5.14(c)HBP: Where EO of the first block is not fulfilled in terms of the above proportions, except in cases where the EO prescribed for first block is extended by the Regional Authority subject to payment of composition fee of 2% on duty saved amount proportionate to unfulfilled portion of EO pertaining to the block, the Authorization holder shall, within 3 months from the expiry of the block, pay duties of customs (along with applicable interest as notified by DOR) proportionate to duty saved amount on total unfulfilled EO of the first block",
and the similar provisions in previous FTP/HBP 2009-14 and 2004-09 are strictly followed by Regional Authorities before issuing EODC/redemption/closure letters; and also that cases of condoning / delay in fulfillment of block-wise EO are considered by Regional Authorities only when exporter has obtained relaxation in terms of DGFT's powers under the FTP. The DGFT has also advised its Regional Authorities to ensure that these provisions are strictly followed in respect of all unredeemed EPCG authorization issued during the FTP 2004-09, 2009-14 and 2015-20.
3C. In the light of this, Board has decided that Customs authorities need not replicate the verification of export obligation of the first block that is being conducted by Regional Authorities and that the EODCs received under EPCG Scheme in terms of FTP/HBP 2004-09, 2009-14 and 2015-20 be normally accepted without further verification, except in 5% cases where they be verified in detail before acceptance.
4. The foregoing aspects remain subject to detailed verification of EODC when there is such a need suggested by specific intelligence. Further, if Regional Authorities endorse verification of shipping bills/other documents on an EODC, such verification shall be carried out. Moreover, it remains mandatory to verify genuineness of non-EDI shipping bills/bills of export on which an EODC may be based.
5. The guidelines issued in the past on the subject shall be modified to the above extent. It should be noted that monitoring of progress of block-wise EO fulfillment is to continue and as clarified in Circular No. 14/2015-Cus the field formations can view the EPCG authorization-wise all India export details in EDI.
6. The Commissioners are also directed to ensure transparent random selection criteria and selection for 5% check being made at least at Joint/Additional Commissioner level and the relevant exporter being invariably informed, on the date of selection itself, via official email communication that its case is selected for detailed checks. Credibility and transparency may be brought into the Bond cancellation process which may be made speedier. The exporter should not be asked to routinely produce information that can be sourced from the Customs EDI system.
To view or download pdf copy of CBEC Instructions in this regard, please refer the link below:
CBEC Instructions dt. 14 Oct. 2016 Procedures reg. Exporters obligations under EPCG au
03 October 2016
ST Arrest Guidelines
Revised Guidelines of CBEC for arrest in relation to Service Tax offences punishable under the Finance Act, 1994 and Central Excise Act, 1944
The CBEC has issued revised guidelines for arrest in relation to Service Tax offences punishable under the Finance Act, 1994 and Central Excise Act, 1944, while emphasizing careful examination of the legal and factual aspects before proceeding with arrest, as under:
CBEC Circular No. 201/11/2016-Service Tax dt. 30 Sept. 2016 F.No. 137/47/2013-Service Tax
1. I am directed to draw your attention to the fact that the arrest provisions in Service Tax were introduced with effect from 10.05.2013 vide sub-sections (J) and (K) of section 103 of the Finance Act, 2013 which introduced sections 90 and 91 in the Finance Act, 1994 and also amended section 89 of the Finance Act 1994. Vide sections 155, 156 and 157 of the Finance Act 2016, with effect from 14.05.2016, sections 89, 90 and 91 of the Finance Act, 1994 have been amended. As a consequence of these amendments, the power of arrest in Service Tax is available only if a person collects any amount as service tax but fails to pay the amount so collected to the credit of the Central Government beyond the period of six months from the date on which such payment becomes due and the amount exceeds rupees two crore.
2.0 Vide paragraph 2 of Board Circular F.No. 137/47/2013-Service Tax dated 17.09.2013 certain conditions precedent to carrying out arrests were indicated. These were:
2.1 Careful exercise of this power since arrest impinges on the personal liberty of an individual.
2.2 The reason to believe that a person has committed the specified offence which is rendering the person liable for arrest must be based on credible material which will stand judicial scrutiny.
2.3 The relevant factors before deciding to arrest a person must be, apart from fulfillment of the legal requirements, the need to ensure proper investigation and prevention of the possibility of tampering with evidence or intimidating or influencing witnesses.
3.0 In the context of the legislative amendments vide the Finance Act 2016 and the single offence for which the power of arrest exists, it is necessary to again emphasize and indicate the factors which must invariably be kept in mind before arresting a person:
4.0 Conditions precedent- Legal
4.1. At the outset there must be clear and unambiguous notings in the file, bringing out how all the ingredients of the offence have been established. The notings must specifically refer to evidence relating to-
4.1.1 Amount collected as service tax: Collection of an amount as service tax should be clear and self-evident from the invoices, bills, contracts, etc. An amount should be clearly indicated as service tax. The copies of sample invoices /bills, contracts, etc. which cover the period being investigated should be in the file.
4.1.2 Amount should exceed Rs 2 crore.
4.1.3 Failure to pay the amount so collected to the credit of the Central Government:
The 8T3 return filed by the assessee for the relevant period, showing the self-assessed value of taxable services and service tax paid should be available in file. Where no such return has been filed, an observation to this effect should be made since this will make the departmental case stronger.
4.1.4 Such a failure should be beyond the period of six months from the date on which such payment becomes due: Fulfillment of the condition relating to the time period must be verified carefully, and a month wise abstract of the invoice numbers, due date of payment of service tax and date when the six month period was completed must be kept ready.
4.2 The suggestions in the preceding paragraph are intended at bringing uniformity in the approach to such matters and ensuring that evidence relating to the alleged offence is readily available for perusal by a judicial body, when necessitated.
5.0 Conditions precedent- factual
5.1 Even if all the legal conditions precedent mentioned in paragraph 4.1 to 4.2 are fulfilled, that will not, ipso facto, mean that an arrest must be made. Once the legal ingredients of the offence are made out, the Commissioner must then determine if the answer to the following questions is in the affirmative
5.1.1 Is the alleged offender likely to hamper the course of further investigation by his unrestricted movement?
5.1.2 Is the alleged offender likely to tamper with evidence or intimidate or influence witnesses?
5.2 If the answer to both the questions is yes, then the decision to arrest can be made.
5.3 If the alleged offender is assisting in the investigation and has deposited at least half of the evaded tax, then the need to arrest may not arise.
6.0 The Guidelines issued vide Board Circular F.No. 137/47/2013-Service Tax dated 17.09.2013 may be referred to for the procedure for arrest, post-arrest formalities and the reporting system.
7.1. It has been decided to revise the monetary limits for arrests and prosecution in Central Excise to maintain uniformity of practice in Central Excise and Service Tax. It is directed that henceforth arrest and prosecution of a person in relation to offences specified under clause (a) to (d) of sub-section (1) of section 9 of the Central Excise Act, 1944 may be considered only in cases where evasion of Central Excise duty or misuse of CENVAT Credit is equal to or more than rupees two crore. Central Excise Circular No. 974/08/2013-CX dated 17.09.2013 and 1009/ 16/2015-CX dated 23.10.2015 stand amended accordingly. Circular No. 1010/ 17/2015-CX dated 23.10.2015 is rescinded in View of the revision of monetary limits prescribed by this circular. It is again reiterated that arrest and prosecution should not be resorted to in cases of technical nature i.e. where the additional demand of duty/tax is based totally on a difference of opinion regarding interpretation of law.
7.2 Transitional provisions as prescribed in para 11 of the Circular No. 1009/ 16/2015-CX dated 23.10.2015 shall apply mutatis-mutandis i.e. all cases where sanction for prosecution is examined and accorded after the issue of this circular, shall be dealt in accordance with the provisions of this circular, irrespective of the date of the offence. Cases where prosecution was sanctioned but no complaint has been filed before the magistrate shall also be reviewed by the prosecution sanctioning authority in light of the enhanced monetary limit and sanction withdrawn for cases where evasion of Central Excise duty or misuse of CENVAT Credit is below the revised monetary limit of rupees two crore.
8.0 It is emphasized once again that since an arrest impinges on the personal liberty of an individual, this power should be exercised with great responsibility and caution and only after a careful examination of the legal and factual aspects indicated in the preceding paragraphs.
CBEC Circular No. 201/11/2016-Service Tax dt. 30 Sept. 2016 | View
13 July 2016
Centralized Registration under Central Excise
New functionality of Single/ Centralised Registration in Central Excise for Jewellery and other specified Manufacturers is now available in ACES
Assessees can now opt for centralized registration and capture additional premises through A1 form, as a new functionality is now available at ACES for single/centralised excise registration for certain specified manufacturers, including for new registration, amendments, etc.
A. New Registration as well as amendment of registration to capture additional premises for the first time in ACES
A new facility has been provided in Central Excise Registration form A1 for certain category of assessees to opt for Centralised registration/ Single registration and correspondingly, capture the list of premises covered under Centralised registration/Single registration.
The following categories of assessees are covered under this implementation:
1) Jewellery
2) Mines
3) Aluminium Roofing Panels
4) Recorded Smart Cards
5) Single registration for CNG
6) Single registration for interlinked units
A new checkbox is provided for selection if the assessee intends to opt for Centralised registration/Single registration. If the option is checked, LOV listing all the above categories is enabled for selection. In case the assessee selects (1) or (2) above, the selection of business category should also correspond to Jewellery or Mines respectively.
In all other cases, the business category shall be Manufacturer. Once the assessee clicks on NEXT after filling up all the fields in the first screen, a new screen to capture list of all additional premises is opened up, if he opts for centralized registration/single registration. The additional premises can be captured online through SAVE and ADD NEW option. Alternatively, if the number of premises are very huge, the assessee can follow the procedure mentioned below:
a) Download the sample XLS file provided in the screen
b) Please read the instructions for filling up the excel worksheet in the README document provided along with the sample XLS file
c) Fill up the excel worksheet as per the instructions and upload the same using the option provided in the screen.
d) The list of premises uploaded will be displayed in the screen and the assessee can further add or delete any of the premises, already uploaded
e) Fill up the remaining particulars in the registration form and save the form
f) The confirmation screen will be opened displaying the A1 form along with the list of premises added/uploaded and the assessee can submit the application.
The above procedure can be adopted by first-time applicant as well as applicant already registered in the above business category, but without capture of additional premises.
The list of premises after generation of RC can be downloaded from the link provided in the VIEW RC screen.
B. Amendment of registration for the above categories, where additional premises have already been captured
For any assessee amending his registration for change of details of additional premises ( where additional premises have already been captured).
1) Click on Amend Registration button in the form.
2) There will be a link for "Download additional premises" which will list out the premises already added for the registration
3) The assessee can add or delete the details in the downloaded list and then upload the XLS again afresh.
4) Make any other changes, if necessary, and then SAVE and SUBMIT the form for approval of the Amendment by AC.
The revised list of premises can be downloaded from the link in the VIEW RC screen as soon as the amendment is approved by AC (if no PV is assigned) and as soon as PV report is approved by AC (if PV is assigned). In case of manufacturers of jewellery, there will not be any PV.
10 July 2016
CBEC on Construction Site
CBEC Clarification on Scope of 'Construction Site' for availing Excise Exemption as appearing in Notification No. 12/2012-Central Excise, dated 17.03.2012
CBEC on Construction Site
CBEC Clarification on Scope of 'Construction Site' for availing Excise Exemption as appearing in Notification No. 12/2012-Central Excise, dated 17.03.2012
05 July 2016
CBEC Clarification on Recovery of Demands
CBEC Clarification reg. Recovery of Confirmed Demands during the pendency of Stay Application
04 June 2016
IDRS
23 May 2016
Unique Warehouse Code
04 May 2016
CBSE taxpayers day
26 April 2016
Service tax date extension
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
CENTRAL BOARD OF EXCISE AND CUSTOMS
SERVICE TAX WING
NEW DELHI
ORDER NO
1/2016-Service Tax, Dated: April 25, 2016
In exercise of the powers conferred by sub-rule (4) of rule 7 of the Service Tax Rules, 1994, the Central Board of Excise & Customs hereby extends the date of submission of the Form ST-3 for the period from 1st October 2015 to 31st March 2016, from 25th April 2016 to 29th April 2016.
The circumstances of a special nature, which have given rise to this extension of time, are as follows:
"Difficulties have been faced by assessees in accessing the ACES application on 25th April 2016"
F.No.137/99/2011-Service Tax
(Rajeev Yadav)
Director (Service Tax)
Central Board of Excise and Customs
24 April 2016
Extension of Time Limit-ED-Jewellery
23 April 2016
Excise duty on Jewellery industry
Institute of Chartered accountant has published a book on excise duty on Jewellery industry. Which answers 105 questions on excise law. It also includes format of records and documents to be maintained. It can be downloaded from following link
http://icai.ind.in/newsletter/lt.php?c=627&m=364&nl=1707&s=2029b9226f3ef6655f1f5e7d142f39fb&lid=27685&l=-http--ucanapply.s3.amazonaws.com/icai/download/CELP_Jewellery%20sector_final_29.3.pdf
05 February 2016
Rebate/refund of SB Cess on exports & services used in SEZ; Cenvat credit cannot be used for SB Cess & others
Dear Professional Colleague,
Rebate/refund of SB Cess on exports & services used in SEZ; Cenvat credit cannot be used for SB Cess & others
The Central Government ("CG") has issued various Notifications under the Service tax and the Central Excise for extending the benefit of refund/rebate to the Swachh Bharat Cess ("SB Cess") component and the input services used beyond factory for export. Further, the Cenvat Credit Rules, 2004 ("the Credit Rules") has been amended to allow Cenvat credit on commission agent's services and to make explicit that Cenvat credit shall not be used for payment of SB Cess.
Gist of all the Notifications is discussed hereunder for easy digest:
Rebate of Service tax on services used beyond the factory or any other place/premises of production/manufacture of goods, for their export
The CG vide Notification No. 01/2016-Service Tax dated February 3, 2016 ("Notification No. 1") has amended Notification No. 41/2012-Service Tax dated June 29, 2012 (Rebate of Service tax paid on the taxable services which are received by an exporter of goods and used for export of goods) ["Notification No. 41"] to include the taxable services that have been used beyond factory or any other place or premises of production or manufacture of the goods, for their export, in the case of excisable goods, under the definition of 'specified services'. Further, clause (B) of Notification No. 41 prescribing definition of 'place of removal' as the one defined under Section 4(3)(c) of the Central Excise Act, 1944, has also been deleted.
Increase in the rate of refund commensurate to the increased Service tax rate
The CG vide Notification No. 1 has further amended Notification No. 41 to increase the rate of refund commensurate to the increased Service tax rate in the following manner:
"(b) in the Schedule of rates, in column (4),-
(i) for the figures 0.04, wherever they occur, the figures 0.05 shall be substituted;
(ii) for the figures 0.06, wherever they occur, the figures 0.07"shall be substituted;
(iii) for the figures 0.08, wherever they occur, the figures"0.09"shall be substituted;
(iv) for the figures 0.12, wherever they occur, the figures 0.14"shall be substituted;
(v) for the figures 0.18, wherever they occur, the figures 0.21"shall be substituted; and
(vi) for the figures 0.20, wherever they occur, the figures"0.23"shall be substituted"
To view full Notification No. 1, please click on the link below:
http://www.cbec.gov.in/htdocs-servicetax/st-notifications/st-notifications-2016/st01-2016
Refund of SB Cess paid on specified services used in Special Economic Zone ("SEZ")
The CG vide Notification No. 02/2016-Service Tax dated February 2, 2016 ("Notification No. 2") has amended Notification No. 12/2013-Service Tax dated July 1, 2013 (Exemption on services received by units located in a SEZ or Developer of SEZ and used for the authorised operation) to enable the SEZ Unit or the Developer for refund of the SB Cess paid on the specified services on which ab-initio exemption is admissible but not claimed.
Further, the refund of amount distributed to the SEZ Unit or the Developer in the manner as prescribed in Rule 7 of the Credit Rules, will be determined by multiplying total Service tax distributed to the SEZ Unit or the Developer in the manner as prescribed in Rule 7 of the Credit Rules by effective rate SB Cess and dividing the product by rate of Service tax specified in Section 66B of the Finance Act, 1994.
To view full Notification No. 2, please click on the link below:
http://www.cbec.gov.in/htdocs-servicetax/st-notifications/st-notifications-2016/st02-2016
Rebate of SB Cess paid on all the input services used in providing services exported
The CG vide Notification No. 03/2016-Service Tax dated February 3, 2016 ("Notification No. 3") has amended Notification No. 39/2012-Service Tax dated June 20, 2012 (Rebate of the duty paid on excisable inputs or Service tax and cess paid on all input services used in providing service exported) to insert SB Cess under the definition of 'service tax and cess', to enable the provider of services to claim rebate of SB Cess paid on all the input services used in providing services exported in terms of Rule 6A of the Service Tax Rules, 1994.
To view full Notification No. 3 please click on the link below:
http://www.cbec.gov.in/htdocs-servicetax/st-notifications/st-notifications-2016/st03-2016
Cenvat credit shall not be used for payment of SB Cess
The CG vide Notification 02/2016-CE(NT) dated February 3, 2016 ("Excise Notification No. 2"), has amended Rule 3(4) of the Credit Rules, to insert a proviso providing that Cenvat credit shall not be used for payment of SB Cess.
It may also be noted here that the Central Board of Excise and Customs in their Frequently Asked Questions released on November 14, 2015 on SB Cess, had specifically provided that because SB Cess is not integrated in the Cenvat credit chain, its credit is not admissible:
"Q.14 Whether Cenvat Credit of the SBC is available?
Ans. SBC is not integrated in the Cenvat Credit Chain. Therefore, credit of SBC cannot be availed. Further, SBC cannot be paid by utilizing credit of any other duty or tax"
Cenvat credit admissible on services of sales commission agent
The CG vide Excise Notification No. 2 has further amended the definition of 'input services' under Rule 2(l) of the Credit Rules, to allow Cenvat credit of Service tax paid on sale of dutiable goods on commission basis, by inserting following explanation after sub-clause (C):
"Explanation.-For the purpose of this clause, sales promotion includes services by way of sale of dutiable goods on commission basis."
It may not be out of place here to mention that in view of the conflicting judgments, eligibility to avail Cenvat credit of the services rendered by a commission agent has been a subjective issue. The Hon'ble High Court of Gujarat in the case of Commissioner of C. Ex., Ahmedabad-II Vs. Cadila Healthcare Ltd. [2013 (30) S.T.R. 3 (Guj.)], has disallowed Cenvat credit on commission agent's services whereas, the Hon'ble Punjab & Haryana High Court in the case of Commissioner of Central Excise, Ludhiana Vs. Ambika Overseas [2012 (25) S.T.R. 348) had allowed the Cenvat credit. Thus, with the insertion of stated explanation, it may be contended by the assessees that because the same is clarificatory which was being disputed on the basis of divergent judgments, therefore, it would have retrospective effect.
To view full Excise Notification No. 2 please click on the link below:
http://www.cbec.gov.in/htdocs-cbec/excise/cx-act/notifications/notfns-2016/cx-nt2016/ cent 02-2016
Hope the information will assist you in your Professional endeavours. In case of any query/ information, please do not hesitate to write back to us.
Thanks & Best Regards,
Bimal Jain
14 January 2016
CBEC prescribes procedure for e-payment of refund/rebate
31 August 2015
Amendment to Customs Duty Free Allowance
20 August 2015
ST Clarification on Section 73,76 & 78
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
CENTRAL BOARD OF EXCISE & CUSTOMS
SERVICE TAX WING
NEW DELHI
All Chief Commissioners of Central Excise/ Service Tax
Principal Directors General of Goods & Services Tax/ Systems/Central Excise Intelligence
Director General of Audit
All Principal Commissioners of Central Excise/Service Tax
All Commissioners of Central Excise/Service Tax
All Principal Commissioners/Commissioners LTU
Joint Secretary TRU-1/TRU-II/Review
Commissioner Central Excise/ Service Tax/Legal/PAC
Under Secretary (Service Tax)
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