SERVICE TAX

Out of the 93 Central Excise Commissionerates in India, Delhi- III, is one of the Central Excise Commissionerate.  These Commissionerates are entrusted with the task of collection of duties in notified territorial jurisdiction of Commissionerate and related administrative functions.  The primary function of a Central Excise Commissionerate is to implement Central Excise Act, 1944 and Rules frames under the various provisions of Central Excise Tariff Act, 1985 and other allied acts of the Parliament of India under which duty of Central Excise or other such duties which are levied and collected in the manner in which Central Excise duties are levied and collected.  For discharging the function of the Commissionerate, it is divided into different branches and field formations. 

The powers and duties of its officers and employees

(a)  The powers and duties of the officers are defined in the Central Excise Act and Rules made there under.  These are further defined in the Central Excise Manual which is a published document.

(b) Central Excise duty is payable on all goods (excluding goods manufactured in special economic zones) which are produced or manufactured in India at rates specified in the Central Excise Tariff.  Under the present assessment scheme, a manufacturer is required to assess himself the duty payable on the goods manufactured by him and deposit the same in authorized Banks.  The details of goods manufactured exemption claimed, duty paid are required to be furnished in periodical returns such as ER-1 returns, submitted to the Department.   These returns are required to be scrutinized and checked by the concerned Central Excise officers to verify that the correct amount of the tax has been paid.

Central Excise Commissionerate, Delhi- III is headed by a Commissioner, who is responsible for collection of Central Excise duty in his jurisdiction and also the appointing and disciplinary authority for officers upto the rank of Group 'B'. At the headquarters, he is assisted by three Additional Commissioners/Joint Commissioners, who are assigned specific areas of responsibilities. The Additional Commissioners are assisted by Deputy Commissioners/Assistant Commissioners. A Deputy Commissioner/Assistant Commissioner is incharge of a branch, which is assigned more specific responsibilities. The Deputy Commissioners/ Assistant Commissioners are assisted by Superintendents, Inspectors, Tax Assistants, UDCs, LDCs etc.

The jurisdiction of the Central Excise Commissionerates, Delhi- III has been divided into four Divisions. The area of a Division depends upon the density of the industry, complexities of the commodities being dealt by the Division and quantum of revenue receipts. Each Division is headed by a Deputy Commissioner/Assistant Commissioner and assisted by four to six Superintendents and about eight to ten inspectors in the Divisional office besides the ministerial staff and an administrative officer.  Each division is placed under the supervisory control of an Additional Commissioner/Joint Commissioner.

The jurisdictional area of a Division is again divided into Ranges. Each range is headed by a Superintendent designated as 'Range Officer'. Each Range officer has two to four inspectors in his charge. Each inspector is incharge of a certain number of units, which varies from Range to Range. The jurisdiction of an inspector is called 'Sector'.

Additional/Joint Commissioner(P&V) is incharge of personal and vigilance matters.   Addl./Jt. Commr. (Anti-Evasion) is responsible for Anti-Evasion activities of the Commissionerate.  Additional/Joint Commissioner (Review) is responsible for review of adjudication orders passed by various original and appellate authorities and for filing of further appeals against the orders which are not legal and proper.  Additional/Joint Commissioner (Tech) is responsible for interpretation of law and its implementation. He also acts as facilitator for the trade & industry. The first check over the proper payment of duty by trade, is done by Range Superintendent and his staff. The audit branch under the supervision of Additional/Joint Commissioner exercises second check for proper and timely collection of revenue.

The range office is the first office of contact between trade and industry and the department.  The Central Excise assessee is required to apply for registration, file declarations, applications etc.  before the jurisdictional Assistant / Deputy Commissioner, who is responsible for granting the Central Excise Registration Certificate.  Under the present assessment scheme a manufacture is required to assess himself the duty payable on the goods manufactured by him and deposit the same in authorized banks.  The details of the goods manufactured, exemption claimed, duty paid are required to be furnished in periodical returns such as E.R- I/ER-3 returns submitted to the department.  The returns are filed quarterly by units in small scale sector and monthly by other units.  These returns are required to be scrtunised and checked by the concerned Central Excise Officers at range level to verify the correct amount of duty has been paid.

Apart from assessment work, the range officer also checks correctness of few statutory declarations filed by the assessee.  The range officials also check the consignment for exports on issue certificate for the quantity and quality of the goods exported.  For any dispute arising out of the assessment, a Show Cause Notice to the assessee is issued by Assistant Commissioner / Deputy Commissioner of the Division or officers seniors to him depending upon the monetary limit involved.  Show Cause Notices upto the value of Rs. 5 lakhs are issued by Assistant Commissioner / Deputy Commissioner, exceeding the value of Rs. 5 lakhs & upto the value of Rs. 20 lakhs the Show Cause Notices will be issued by the Joint Commissioner, exceeding the value of Rs. 20/- lakhs & upto the value of Rs. 50 lakhs the Show Cause Notices are issued by Additional Commissioner.  Commissioner can issue Show Cause Notice without limit. 

Department’s action against an assessee starts with the Show Cause Notice issued by the department.  Normally thirty days time is given to reply to Show Cause Notice. Based upon reply & further submissions during personal hearing which the assessee can demand, the Central Excise Officer passes an order.  This order is called an order-in-original or an adjudication order.  Against this order, an appeal can be filed with the Commissioner (Appeals).  The next channel of the appeal is Customs, Central Excise, Service Tax Tribunal (CESTAT), under section 35B of Central Excise Act, 1944.  Appeal can be made to the High Court and Supreme Court as the case may be against the order of the tribunal. 

The work of a group of Ranges is supervised by Divisional officer. He may be in the rank of a Deputy Commissioner or an Assistant Commissioner. As a divisional head Deputy / Assistant Commissioner has certain statutory obligations under the act viz. scrutiny of the  declarations filed by the assessee and also grant them. He also grants certain permissions under the Rules. He is responsible for proper compliance of Central Excise law and procedure within his jurisdiction. He also has quasi judicial functions and having adjudication powers for the cases where the amount of duty involved is upto Rs. 5 lakhs.  However all the matter pertaining to valuation and classification cases are decided by him irrespective of amount of duty involved.  The provisional assessment of Central Excise duty/liability can be allowed by Assistant Commissioner/Deputy Commissioner of the division.  The Deputy Commissioner/Assistant Commissioner is required to finalise the assessment after calling for such documents or records as he may consider necessary or proper in the circumstances of the cases.  He is responsible for collection of intelligence and organizing the anti-evasion operations within his jurisdiction.  At divisional level he also looks after compliance of audit related work.  The assessee may also apply for refund/rebate to the jurisdictional Deputy / Assistant Commissioner.  Such refund/rebate applications can be made in accordance with the provisional of Section 11B of the Central Excise Act, 1944.  The Deputy /Assistant Commissioner of the jurisdictional division office is the authority to whom the claim for refund / rebate is to be filed and also the sanctioning authority.  He also aids and assist Commissioner, Additional Commissioner, Joint Commissioner in enforcing discipline and in taking action against the delinquent officer. 

The work of all the Divisions is supervised by the Commissioner with the help of Additional Commissioners, Joint Commissioners, Deputy Commissioners/ Assistant Commissioners and other subordinate officers.

The Commissioner is responsible for due compliance of law and procedures in his jurisdiction. He also does the adjudication of the cases involving short levy/non-levy or offence cases is without any limit of amount. He also reviews the adjudication orders passed by the subordinate officers,  pre-audit and post-audit of refund/rebate claims.  Besides above he also does the supervision of work rebating to audit and Anti-Evasion branches.  The Additional Commissioner / Joint Commissioner assist the Commissioner in exercising supervision over the Commissionerate. 

The Anti-Evasion branch of the Headquarters is responsible for collection of intelligence about evasion of duties and take effective steps to thwart any attempt at that. The officers from audit branch visit all factories paying revenue more than rupees one crore once a year and other factories once in two years and conduct thorough scrutiny of their records to ensure that duty payable by them has been paid correctly and on or before the prescribed date.

Besides Superintendents who are Group’B’ executive officers, there are Group’C’ Executive officers of the rank of Inspectors, Group B & C Ministerial officers and Group D officers in each Commissionerate.

The procedure followed in the decision making process, including channels of supervision and accountability.  Other information for the assesses :-

The procedure followed by the officers in the decision making process and different aspects of supervision and accountability are outlined in the Central Excise Manual, the Adjudication Manual, Audit Manual, etc. 

1.    Registration – The Central Excise assessee is required to apply for   registration/ file Declarations, Applications etc before the jurisdictional Assistant/Deputy Commissioner, who is responsible for granting the Central Excise registration certificate.

2.   Scrutiny of Returns - The Central Excise returns filed by the assessee after self assessment are checked by the Inspector and put up to the Superintendent.  For any dispute arising out of assessment, a SCN to the assessee is issued by the Assistant/Deputy Commissioner of the division or officers senior to him depending  on the monetary limit involved.

3.  Provisional Assessment - The provisional assessment of Central Excise liability can be allowed by the Asst/Deputy Commissioner of the division.  The Asst/Deputy Commissioner is required to finalize the assessment after calling for  such documents or records as he may consider necessary or proper in the circumstances of the case.

4    Adjudication – Departmental action against an assessee starts with a Show Cause Notice by the department.  Normally thirty days time is given to reply to the show Cause Notice.  Based on the reply and further submissions during personal hearing which the assessee can demand, the Central Excise officer passes an order.  This order is called an order-in-original or an adjudication order.  Against this order, an appeal can be filed with the Commissioner (Appeals).  The next channel of Appeal is the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) under Section 35B of the Central Excise Act, 1944.  Appeal can be made to the High Court and Supreme Court, as the case may be, against the order of the Tribunal.

5.  Refund/Rebate – The assessee may also apply for refund/rebate to the jurisdictional Asst/Dy Commissioner.  Such refund/rebate application can be made in accordance with the provisions of Section 11 B of the Central Excise Act, 1944.  The Asst/Dy Commissioner of the jurisdictional division office is the authority to whom the claim for refund/rebate is to be filed and is also the sanctioning authority.

6.    Audit – Audit of the Central Excise assesses is being conducted as per norms prescribed by the Department.  A Central Excise  audit cell headed by the Joint/Addl Commissioner, functions under the overall supervision of the Commissioner.  The audit of units is being conducted by a team of four to five officers.