The excise department has registered a significant rise in number of defaulters in the last four months of the current financial year in the state.

The rising default has added to the woes of excise department, which has already registered a fall in growth of excise income.

As per data available with the central excise department, Ahmedabad, in the year 2007-08 registered 43 fresh cases of defaults while the total number of defaulters across the state was 176. Around 34 fresh cases of default were registered in the state for the months of October, November, December and January of this fiscal.

In fact, in the last 10 months of the current fiscal, 41 new cases of default were registered taking the total number of defaults to 198 for the period up to January 2009. Excise department says that during the four month period from October 2008 to January 2009 revenue collection has taken a hit due to the economic crisis.

“The last four months have been very critical for the department. The revenue collection dipped significantly even as the number of defaulters rose,” said a senior excise officer.
However, another senior officer did not attribute the rise in default to recession.

“The rise in number of defaulters has nothing to do with recession. The department needs to complete various legal formalities and procedures before declaring a person a defaulter. And this takes more than a year,” said the officer.

Interestingly, Commissionerate of Excise, Ahmedabad-1 has witnessed the highest number of the defaulters in the state.

The zone consists of mainly textile or its associate industries including chemicals and other manufacturing units.Excise officers say the textile industry has been facing several problems for some time now. This included scarcity of raw material and rising competition from Chinese goods. This led to closure of many textile units.

The department is yet to prepared a data of the sector-wise defaulters. This zone also includes Rakhial, Vatva, Narol among others where the number of defaulters touched 103.

“The rise in prices of crude, cotton, chemical and other raw material drastically raised the input cost, but the prices of finished goods remained the same. This forced many units to shut shop,” said Biren Parikh, Managing Director of MH Mill and Industries.

According to excise officials, most of the defaulters are not traceable as they have shut their units and locked their houses.

Sources in the department told DNA that the department is soon planning to make a list of offenders in the state and will take legal action against them.

As of now, the excise department has to collect Rs 40.17 crore from 198 defaulters of which only 15 could be traced. Those who could be traced are not in a position to cough up the money.

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