Government of India
Ministry of Finance
Department of Revenue, New Delhi
Subject: Proposal for introduction of self-assessment – Instructions regarding.
I am directed to refer to above subject and to say that with effect from 1st October, 1996, the following instructions should be followed:-
2. Procedure to be followed by the assesses:-
(i) As in the past, every assessee is required to file, as per the prescribed frequency, (i.e. Quarterly for SSI units and Monthly for others) a return in the from of RT-12, which shall be accompanied by two copies of extracts of PLA and one copy of RG-23 Part- I & Part-II.
(ii) As a measure of simplification, the proformae of RT-12, PLA and RG-23 (A & C) have been recast. However, keeping in mind the proposed on line verification with the help of computer some new columns have been provided in the revised in the revised PLA and RG-23 proformae for indicating assessee”s own Excise Control Code No. (ECC No.), Buyer”s Excise Control No., and sub-heading of the item. In addition, in RG-23 proforma a column has also been added for indicating ECC Number of the supplier.
(iii) The Monthly RT-12/ Periodical returns, copies of PLA or RG-23 for the month of October, 1996 and, thereafter, should be furnished in the revised proformae. Assessee can, however, use the existing proformae for the month of October “96. They should make the necessary arrangement for getting the RT-12 Return, PLA and RG-23 proformae printed in the new format so that from November “96 onwards they can file the return and maintain their PLA and RG-23 accounts in the revised proformae.
(iv) In the RT-12 return, entry shall be made tariff sub-heading wise. In respect of each such sub-heading break-up should be given for the quantity of goods received and the quantity of goods cleared, value, rate of duty separately for clearances under different Rules. Footnotes given in the revised RT-12 may be referred to in this regard.
(v) Entries in PLA and RG-23 accounts shall also be made sub-heading wise. It is clarified that where one invoice covers the goods falling under different sub-seadings, and /or consolidated debit entry has been permitted to be made at the end of the day, in such cases entries can be made by the assessee entering the break-up of duty paid in respect of each sub-heading.
(vi) The present procedure of completion of the assessment memorandum by the concerned Rangs Supdt. is being dispensed with. Instead, the assessee himself would be required to append a self-assessment memorandum as part of the RT-12 duty signed by his authorised representative, signatory. The assessee can obtain the dated acknowledgment from the Range Officer on their own copy or RT- 12 return.
(vii) The assessee need not file any invoices, issued by them, with the RT-12 return. Instead, serial number of invoice/other similar documents issued by them shall be indicated in the self-assessment memorandum.
(viii) The assessee will, however, submit along with the copies of RG-23A (Part-I & II), RG-23C (Part-I & II), Rule 52A, invoice & similar documents specified under Rule 57G on the basis of which they have availed of Modvat credit, and the TR-6 challans.
(ix) the assessee will continue to file declaration, inter-alia, under Rule 173B, Rule 173C, Rule 57G and 57Q of Central Excise Rules, 1994 etc.
(x) The assessee shall make available to the Central Excise officers the records and documents, including invoices, as and when required by the Department.
(xi) The assessee can obtain the guidance of the Central Excise Officers wherever any difficulty is faced by the assessee in filling the return in the revised proformae.
(xii) The assessee can request the proper officer for professional assessment, explaining the reasons for such a request, in cases where they are not able to self-assess the duty on account of the reasons that the value of the goods can not be determined at the time of clearance or the correct classification required chemical tests etc. Such procisional assessment should be finalised in a time bound manner, normally, within 3 months.
(xiii) The assessee can file a Refund Claim in accordance with Section 11B of the Act where according to him duty paid on the basis of self – assessment is in excess of what was payable.
(xiv) The records and documents shall be preserved in such manner and for such period as may prescribed.
3. Duties and Responsibilities of Staff Posted in Range/ Division
3.1 The duties of the Central Excise Officers specified in Basic Excise Manual/Existing instructions shall be modified to extent as follows:-
A. Scrutiny by the Range Officer
As against the assessment of the RT-12 Return being done hitherto, post scrutiny or RT-12/ Quarterly return shall be done by the Range Officers within 3 months of their receipt and send a certificate to this effect to the Divisional Assitant Commissioner along with a statement of RT-12 Return scrutinise by the 15th of the month following the due date, especially with regard to the following aspects, :-
(i) correctness of rate of duty applied to goods cleared, as indicated in RT-12 vis-a-vis the declaration filed under Rule 173B, Board”s instructions etc. unless any changes in these goods or process amde in the meanwhile would warrant a change in the applicable rate of duty.
(ii) arithmetical accuracy of duties/ amounts due and payable as shown on RT-12 and their debit through PLA / RG-23 accounts; and
(iii) arithmetical accuracy of credit entries in PLA/ RG-23 accounts vis-a-vis TR6 challans / Modvat credit documents, particularly those involiving large amounts.
(iv) Scrutiny and critical evaluation or the Modvat declarations, Modvatable invoices and similar documents to ascertain the extent and admissibility of Modvat.
(v) Scrutiny of RT-12 Return should be completed within three months. of their receipt.
(vi) Range Officer may call for the documents from the assessee wherever necessary for scrutiny.
B. Verification of Modvat and defacing or credit documents
(i) The document on the basis of which credit has been availed of shall be verificed and deraced as usual. To facilitate on-line verification, proformae or PLA and RG-23 have been amended by providing for columns on Excise Control Code Number (ECC No.) of the supplier and the Buyer and Chapter sub-heading. The Sl.No and date of the credit document under verification, sub-heading of the items mentioned in the said credit document, ECC No. of the buyer, and total duty debited can be tallied with the corresponding entries in respective copies of PLA/ RG-23. However, where on-line verification is not possible, the same shall be done as being done hitherto.
(ii) It is further amplified that the verification form used for Modvat verification should be modified to the effect that ECC Number allotted to the assessee and their suppliers and the sub-heading of excisable inputs are mentioned in said verifcation forms.
(iii) Commissioner should allot ECC Number also to the persons registered under Rule 57GG and such persons should be asked to indicate this number in the documents issued by them under Rule 57G.
C. Duties of the Assistant Commissioners and Deputy Commissioners/Addl. Commissioners
(i) The Assistant Commissioners should ensure that the verfication of the declaration under Rules 57A, 57G/ 57Q, Rule 173B, Rule 173C etc. are made in accordance with the existing instructions and in a time-bound manner.
(ii) The Assistant Commissioners and Addl. / Deputy Commissioners should also scrutinise the RT-12 Return of units paying annual revenue of Rs. 1 to 5 crores and Rs. 5 crores and above respectively. They should visit the Range Office and select at random at least one RT-12 Return of each such unit for scrutiny by them once in every six months to check, inter alia.
** whether the RT-12 returns are being scrutinised by the Range Officer properly.
** whether scrutiny of RT-12 returns is completed by the Range Officer within three months of their receipt.
** whether the input and other materials declared and final products manufactured by the assessee are same as specified in the Rule 57A/ 57Q and the notificaation issued thereunder.
** whether documents on which credit has been availed are being verified and defaced by the Range Officer as per existing norms
** whether the goods manufactured and cleared by the assessee are classified correctly by the said assessees in accordance with the declarations filed by them and approved by the Asstt. Commissioner.
** whether the classification of the goods shown in self-assesseed RT-12 return is in conformity with said declarations, and
** whether the provisional assessments have been made in accordance with the provisions of Rul. 9B and adequate actions are being taken to finalise them etc.
(iii) In addition, they shall check 5% of credit/debit entries in account current of the assessee along with credit challans/ documents.
(iv) They should visit at least one major factory every month and call for some of the invoices issued from depot/ branches to see whether value on which duty has been paid by the assessee on clearances made to such depots/ branches is in accordance with Section 4 of the Central Excise Act.
(v) Commissioners should on their visit to Range Officers also check, at random, some returns scrutinised by the Range Officer/ Assistant Commissioner / Deputy commissioner/ Addl. commissioner as part of the inspection of the Range/ Division and may initiate corrective measures wherever necessary. Commissioners should also visit once in 6 months, units, working under Record Based Control, as per existing instructions.
4. Provisional Assessment
Wherever an assessee is not in a position to determine the correct duty, he may request the proper officer for provisional assessment or duty in accordance with Rule 9B. The assessee shall clearly bring out the grounds for provisional assessment, and upon being satisfied, the proper officer may order the provisional assessment in accordance with Rule 9B. Asstt. Commissioner should pass the order directing provisional assessment within a month of receiving the request from the assessee. Till such period assessment made by the assessee will be otherwise finds it necessary, he may order provisional assessment in accordance with Rule 9B. In this regard, necessary amendment in Rule 9B(1) has been effected.
Provisional assessment in all cases must be finalised by the proper officer in a time-bound manner, within 3 to 6 months.
5. Preparation and issue of Demand -Cum-Show-Cause Notices
It during the scrutiny of the RT-12 return or the audit or inspection, it is noticed that duty of excise leviable on any goods has escaped self-assessment and been not paid/shortpaid or has not been correctly or properly self-assessed and been paid by the assessee on that basis, necessary action shall be taken by the Proper Officer for preparation and issue of demand-cum-show-cause notices in accordance with Section 11A of the Act. Show-Cause-Notice for less than 6 months not involing fraud etc. answerable to Assistant Commissioner would be issued by the Superintendent as at present and others by the Concerned Commissioner of Central Excise as at present.
6. Relevant provisions of Central Excise Rules, 1994 are under the process of amendment and will be intimated shortly.
7. The Director General of Insppection (SGICCE) will monitor the working of the scheme and furnish a report to the Board every six months.