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Regarding Central Excise - Dispensing with maintenance of records in a
specific format prescribed by the Central Excise Department and acceptance of
records maintained in the normal course by the factories paying Central Excise
duly exceeding Rs. 5 crores
Circular
No. 457 dated 20th May 1999
I
am directed to say that in Para 68 of the Budget Speech (1999-2000), the Finance
Minister had announced that the factories paying more than 5 crores excise duty
in a year will not be required to maintain their records in a specific format
prescribed by the Excise Department. The records maintained in the normal course
of their functioning would be accepted as adequate.
2.
The Board has examined the matter in consultation with Directorate
General of Inspection (Customs & Central Excise).
3.
Clause (a) read with clause (c) of Sub-rule (4) of Rule 173G already
provides that the Commissioner may direct, in respect of any assessee or class
of assessees that all books of accounts concerning production, manufacture,
storage, delivery or disposal of goods, including the materials received for or
consumed in the manufacture of excisable goods or other goods, the goods and
materials in stock with him and duty determined and paid by him shall be deemed
to be in proper form for the respective purpose. In other words, the private
records of the assessee could be accepted as adequate if any obtain the
requisite information.
4.
It may be noted that initially the facility was extended only to the
assessees working under Record-Based pattern of Control (RBC). With the
simplification of procedures and emphasis on the voluntary tax compliance, this
facility can be extended to other "class of assesses" working under
SRP, namely, a factory paying more than Rs. 5 crores central excise duty in a
year (each factory being an assessee under the Central Excise Rules) from
account current.
5.
Clause (b) of Sub-rule (4) of Rule 173G also provides that the
Commissioners have power to exempt an assessee, by order in writing, from
authentication by proper officer before the books of accounts maintained under
clause (a) of this Sub-rule are brought into use. Since the present proposal
relates to "class of assessees". The Commissioner may issue a general
order specifically exempting such "class of assessees" (i.e. a factory
paying more than Rs. 5 crores central excise duty from account current) from
authentication.
6.
In view of the above, and in exercise of powers conferred by Rule 233 of
the Central Excise Rules, 1944, the Board has decided the following:
A
factory which is covered by Chapter VII-A of the Central Excise Rules, 1944 and
has paid central excise duty exceeding Rs. 5 crores from the account current in
the preceding financial year or whose payment of central excise duty from
account current exceeds Rs. 5 Crores in the current financial year, may maintain
his own books of accounts in lieu of statutory records. It is clarified that
this excisable goods on which duty is levied under Section 3A of the Central
Excise Act, 1944, hundred percent export-oriented undertakings, Software
Technology Parks, Electronic Hardware Technology Parks and Free Trade Zones.
These
accounts will be in lieu of the statutory records. They need not be in the
specific format prescribed for the statutory records. They may also contain any
other information, as deemed necessary by the assessees, for their accounting
purposes. In other words, such records of an assessee may contain information of
more than one statutory record. Entries in such records however shall be made on
daily basis unless specifically provided otherwise in any rule of supplementary
instruction issued by the Board or the Commissioner. It is also clarified that
under this scheme, the term "statutory records" do not include the
Returns/ Applications/ Declaration prescribed under the Central Excise Rules.
This
opinion shall be exercised by intimating the Commissioner of Central Excise in
writing. The assessee will clearly indicate the private records, which he is
maintaining in lieu of each of the statutory records.
The
Central Excise Officers will not authenticate the private records of the
assessees before these records are brought into use. The assessees of the
category specified in (1) above shall deem to be specifically exempted by the
Commissioner under clause (b) of Sub-rule (4) of Rule 173G.
Where
an assessee maintains computerised records, he shall take out the printouts
(hardcopy) at the end of the month and a serial number shall be marked on each
page. The printouts shall be placed in a folder in continuous serial numbers and
shall be bound in book form at the end of the month.
Such
private records shall be preserved for a minimum period of 5 years (the
year to which entries pertain, shall be excluded while calculating this period).
The
copy of Personal Ledger Account, RG-23A part-I & Part-II and RG-23C Part-I
& Part-II (portion relating to the relevant month) shall continue to be
submitted along with self-assessed RT-12 return to the Department. It is further
clarified that the Excise Control Code (ECC) number allotted to the assessees
will remain the same.
These
instructions shall come into effect from the 1st June 1999. The
assessees who intend to adapt their private records to the Central Excise
requirements may continue to maintain the records in the statutory format for
the time being. In any case maintenance of private records in the manner
specified in this Circular is an option to the assessee.
7.
The Commissioners are required to closely watch the new scheme and
conduct a survey after a period fo 6 months from now to appraise the efficacy of
this scheme. In case there are any suggestions in this regard, the same may be
forwarded to the Board.
8.
The Commissioners are also requested to issue a detailed trade notice
immediately so that the scheme can be availed of by a factor specified in this
Circular with effect from 1st June 1999.
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