Government of India
Ministry of Finance
Tax Research Unit
Circular No. 1021/9/2016-CX
New Delhi, Dated the 21st March, 2016
To,
Principal Chief Commissioners / Chief Commissioners of Customs (All)
Principal Chief Commissioners / Chief Commissioners of Customs & Central Excise
(All)
Sir / Madam,
Subject: Imposition of Central Excise duty on jewellery —
Constitution of sub-committee of the High Level Committee —regarding
In the Budget 2016-17, Central Excise duty at the rate of 1% (without input
tax credit) and 12.5% (with input tax credit) has been imposed on all articles
of jewellery (except for silver jewellery, other than those studded with
diamond, ruby, emerald or sapphire).
- In this regard, it has been decided to constitute a Sub-Committee of the
High Level Committee to Interact with Trade & Industry on Tax Laws, chaired by
Dr. Ashok Lahiri, which will consist of:
- three representatives of the trade [to be decided by the Government;
- one legal expert [to be decided by the Government];
- officer concerned from the Ministry of Commerce & Industry [MoC&I] to be
nominated by the MoC&I; and
- high level officials from the central excise department to be nominated by
the Central Board of Excise and Customs. The composition of the Sub-Committee
will be circulated once the names of its members are finalized.
- All associations will be given an opportunity to submit representation before
the sub-committee in writing and the all India associations to state their case
in person.
- Terms of reference of the Sub-Committee will include the issues related to
compliance procedure for the excise duty, including records to be maintained,
forms to be filled including Form 12AA, operating procedures and any other
issued that may be relevant. The Sub-Committee will submit its report within 60
days of its constitution.
- Till the recommendations of the Sub-Committee are finalized, the following
shall be adhered to:
- All payments of central excise duty will be based on first sale invoice
value;
- The central excise authorities will not challenge the valuation given in the
invoice provided the caratage / purity and weight of the gold/silver with
precious stones; and carats of diamond/precious stones are mentioned on the
invoice;
- The central excise officers will not visit the manufacturing units/ shops/
place of business/residence of the jewelers;
- No arrest or criminal prosecution of any jeweler will be done;
- No search or seizure of stocks by any central excise official will be
effected; f) Exporters will be allowed to export on self declaration and
submission of LUT to customs without the need to get LUT ratified by central
excise. Prevailing system will continue.
- The registration of the establishment with the central excise department can
be taken within 60 days from 1st March, 2016. However, the liability for payment
of central excise duty will be with effect from 1st March, 2016, and as a
special case for the month of March, 2016, the assessee jewelers will be
permitted to make payment of excise duty along with the payment of excise duty
for the month of April, 2016.
- Any further communications with the regard to the aforesaid Sub-Committee may
be addressed to the Office of the High Level Committee (HLC), Suite No. 215, The Janpath Hotel, Janpath Road, Opp. BSNL Building, New Delhi-110001.
- Wide publicity may be given to this circular. Difficulty, if any, in
implementing the circular should be brought to the notice of the Board. Hindi
version would follow.
Yours faithfully,
Kalimuthu
Under Secretary
F.No. 354/25/2016-TRU
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