India’s flourishing exports is showing direct impact on our EOU software sales. We have received wide acceptance to our EOU software from across India. Due to flourishing Exports, EOU software sales have gone up by 40% in last two quarters. Our service centers have been successful in installing, implementing and making EOU software online within given time frame.

Our clients of EOU Software are
• James Robinson Pvt. Ltd. from Vapi
• Vimal Agro from Bardoli
• KPTL & Gentek from Gandhinagar
• Asiatic Colourchem from Naroda,
• Anar Chemical Pvt. Ltd. From Vatva
• Mid East integrated Steel Pvt. Ltd. From Orisa
• Responsive Polymers Ltd. & Exim Impex International from Bhoisar.

exhibition period is 25th-30th Jan.'06.

Timings are 3.00 p.m. - 9.00 p.m

NIMA is the major event of its kind held once in 3 years. It is considered in the whole of Northern Maharashtra as a unique industrial event. Eagerly awaited by Business & Trading Community and so also by general public of Nashik, Dhule & Jalgaon.

TRADE NOTICE NO. 17/2005 - CENTRAL EXCISE

Subject: On-line submission of certain information in respect of production, clearance, Revenue-liability etc. on a weekly basis by major Central Excise paying units-reg.

The Hon'ble Finance Minister has desired that there should be closer and regular interaction at senior levels between the Department and the major Central Excise assessees, who contribute a bulk of the Central Excise revenue. This will enable the senior officers of the Department to keep in touch with the prevailing realities and to take prompt remedial action for the problems, if any, faced by such assessees.
2. With this objective, consultations were held with the leading trade chambers. It has been decided that major assessees shall henceforth submit the information on-line deleting to production, clearance, exports and revenue-liability etc. on a weekly basis. The intention is to facilitate regular interaction with the major assessees for better mutual understanding and not to base any assessment on such information. This will open a systemic communication channel between the Department and the major assessees at senior levels. Further details are indicated below in a question-answer form:-

Question : Who are required to submit this information?
Answer : All the assessees, who paid over Rs. One crore from PLA in the preceding financial year, are required to furnish this information.

Question : What information is required to be submitted?
Answer : The format for on-line information is annexed.

Question : What will be the modalities for submissions of the information?
Answer : All such assessees will be required to fill the web form and submit the data to the Department electronically. No paper report is required to be submitted. A de-mat format for this purpose including the fields containing weekly details of production and clearances and duty liability for on-line submission by such major Central Excise assessees has been developed. The web form for the same is hosted on the website: exciseandservicetax.nic.in. The detailed procedure to access the website and load the data is enclosed. The confidentiality of the information will be maintained.

Question : How should the data be posted?
Answer : The data is to be posted on the website indicated above. The assessees will use the user Id and password allotted to them for e-filing the said information. The login Id & Password for such units can be obtained from the jurisdictional Commissioner of Central Excise.

Question : What will be the periodicity of submission of such information?
Answer : The information is to be submitted on a weekly basis. For the purpose of this information, the weekly period and the last date for its submission are specified below:

The assessees are requested to file the information weekly with effect from the last week of June, 2005 (i.e from 22nd June, 2005 to 30th June, 2005 to be filed by 3rdJuly, 2005).

Weekly Information
Registration Number____________
Name of Assessee ______________ LOC Code _____________ Return No.___________
YYYMM __________________
SNO. _____________________
CETSH ___________________
LOC ______________________
Qty produced during the week _____________

Home Consumption involving payment of duty

Home Consumption not involving payment of duty Export.

The procedure to access the site
1. Open the site http://exciseandservicetax.nic.in.
2. Click on the link 'File Your Central Excise returns'.
3. Enter the User Id and password.
4. On successful Login, the main menu will displayed.
5. Choose the Weekly Information Option and then Click on Entry Button.
6. Now it will ask the Year and Month YYYYMM format.
7. Then it will ask for the Week (W1/W2/W3/W4) of the Month for which the information is to be submitted.
8. Next it will ask for the Return No. By default it is 1. Press O.K. Button.
9. Now it will display the Entry Form of the Weekly Information.
10. Fill the Form and save the record. Similarly more records can be entered and save.
11. After all the records are entered, click on 'File You Return' button to finally submit the Weekly Information. Once submitted, records cannot be amended.

Kodak India reaffirms the trust in Udyog Excise Software first by placing the order for its 27depots and now for its 3 manufacturing locations Bangalore, Goa and Malanpur. Udyog Excise Manufacturing is deployed at this three places and currently in process to get integrated with their Fourth Shift ERP software.

>> Click here to download New ER-1 & ER-3 format

Normally Saturday and Sunday are holidays for DDT, but with so much happening, we cannot afford a holiday.

IT is finally out, the 8 digit Central Excise Tariff is to come into force from 28.2.2005 as per Notification No. 6/2005 - Central Excise (NT), dated: February 24, 2005. The Government has issued 8 other notifications to carry out the changes in several notifications. All these notifications come into effect from 28.2.2005 and that would mean from 0000hrs of 28.2.2005 that is you have one whole day to study the new tariff, before it is amended in the budget – if you can get a copy of it that is! Nobody just nobody in the world seems to be having a copy of the new tariff. The Government’s job is over once the law is notified.

The Bible says, “Search and thou shalt find” – there was no Central Excise tariff to search for in those days.

But what are these nine notifications which the Government kindly made public and what are they all about?

They are meant to carry out the new headings in the more than a hundred notifications issued by the Government all these years. Here’s the list of the nine notifications and what they propose to do.

With so much pre budget confusion, you can very well expect what’s in store, if Shakespeare was right, “coming events cast their shadows before”.

VERY rare is the Central Excise assessee who has escaped from show cause notices. The language used in the notices is official, impolite and always alleging that you have either not paid duty, or have been given refund erroneously or that you have committed some irregularity for which you ought to be punished. Some of these notices also use the term 'demand notice' or 'demand-cum-show cause notice'. Some are cryptic while others are voluminous. The fact remains that all of these upset you and prompt you to immediately consult your lawyer/tax consultant who assures you that the notice is bogus, bad in law, and unsustainable and is likely to be dropped.

You, however, know that this assurance has a price tag associated with it. So you come out of his chamber wondering why such notices are at all issued. Let us try to understand what is a show cause notice under the central excise law, why is it issued and how to reply them.

WHAT IS A NOTICE?
Under the Central Excise law, an assessee while removing manufactured excisable goods from the factory, is required to work out the duty. Prior to Budget 2000, he was also required to pay the duty so worked out before actually removing the goods. Under the recent scheme he can defer the actual payment for a fortnight. Whatever may be the system, it casts an obligation upon the assessee to calculate the duty and pay it. He is also required to make an assessment of the total duty that ought to have paid and also actually paid, on a monthly basis. The role of the department is mainly that of a watchdog. This is the crux of the 'self removal procedure' and 'self assessment scheme' being followed under the Central Excise law.

For working out the duty, one must apply the correct rate of duty on the correct value of the goods (in most of the cases where the payable duty is a function of the value of the goods-ad valorem duty structure) and the actual quantity of goods removed from the factory. The correct rate depends upon the classification (i.e. the placement) of the goods under the Central Excise Tariff. It also depends upon whether the goods attract a concessional (i.e. lower than the normal) rates that are notified (published by the Govt. by issue of notifications in the official gazette) from time to time. The duty worked out is paid by the assessee either by making payment in cash (i.e. by maintaining an account and debiting it) or debiting the modvat (now called the CENVAT) credit that he earns while purchasing the raw materials or the capital goods.
As said earlier, it is the responsibility of the assessee to discharge the correct duty liability. He is also required to follow the procedures that are prescribed. If the watchdog (i.e. the department) feels that the assessee is not acting in required manner, it starts howling. The watchdog may have the objection to the rate of duty applied, value and the quantity of the goods taken for duty calculations, manner in which credit has been taken and utilised for payment of duty or the procedures followed. It starts alleging that the assessee is misdeclaring the goods or misclassifying them, undervaluing them, removing (part of or the entire) consignments of goods surreptitiously or using credit that was not available to him. A dispute starts which results in the issue of a show cause notice.

A show cause notice is actually a mechanism to protect the rights and the interests of the assessee. Under this mechanism the department is obliged to make a written statement spelling out the allegation that it makes against the assessee as also giving the details of the facts and the evidences and the reasons for reaching to such conclusions. It is supposed to be a self-contained document wherein department says all it has to say in the matter. The notice then goes on to ask the assessee to show cause as to why the allegations made against him are not true and why the action proposed against him should not be taken (hence the name 'show cause notice').

The Department's arguments thus close with the issue of the show cause notice and normally it can not keep adding facts or making new allegation on the same issue. It must also be remembered that a show cause notice is an interim view of the department, which may ultimately stand against the assessee or may fall flat.
The ball is now in the court of the assessee, who has the right to counter the allegations made by the Department, by denying certain facts, by contradicting the evidences put forth by the department and by questioning the reasons given and the conclusions drawn by the department. The deciding authority takes his decision on the matter taking into account the views of both the contesting sides. This ensures the legal principle of natural justice that dictates that 'no person should be condemned unheard'.

WHAT DOES A SHOW CAUSE NOTICE CONTAIN?
The proposed actions in a show cause notice can be any of the following or combinations thereof -

1. Payment of central excise duty on the grounds that either the assessee has not paid any duty on the goods removed or have paid less duty (called duty short-paid) than was required to pay
2. Return of the amount of duty refunded by the department to the assessee on the grounds that the refund was given to him erroneously.
3. Payment of the amount of (modvat or CENVAT) credit that has been wrongly taken by the assessee by either expunging the credit from the account or by making actual payment.
4. Confiscation (means the possession and ownership to be taken over by the government) of the goods in question as they are offending goods (as some offence/irregularity has been committed in respect of them).
5. Penalisation of the assessee (be an individual, a firm, a company etc.) on the grounds that the assessee has committed an error/irregularity/ offence under the central excise law.
6. Payment of interest on duty not paid on time.

As the first of the actions mentioned above demands duty from the assessee, such notices are often called 'demand notices' in common parlance. A show cause notice first gives the details about the brief facts of the case which includes details about the assessee or the assessees (in a show cause notice they are called the noticee/noticees), their activities, the material facts that the department wishes to highlight (like an incidence of surreptitious removal of goods, that the goods were declared as 'X' whereas they were actually 'Y' or that the actual value of the goods was 'A' and not 'B' as declared by the assessee).

In this part the evidences such as documents recovered during search operations, statement of the employees of the assessee (recorded by the officers), details about product, technical literatures etc. that the Departments to rely upon to reach to the conclusion are also given. Also, the show cause notice gives the conclusions drawn by the Departments. These are based on the facts and normally starts with the phrases 'From the foregoing facts it appears that' This part also refer to the various allegations it makes against the assessee, its employees, goods etc. this is an important part of the show cause notice because it shows the mind of the department insofar as the violations of the provisions of the law is concerned.

Towards the end, the show cause notice tells about the action that it recommends against the assessee and challenges him to show cause as to why these should not be done. Finally, it informs the assessee the name and address of the authority who would finally decide the fate of these charges (called the adjudicating authority). It also informs about the time limit within which the assessee should put forth his arguments.
Show cause notices often enclose list of documents that the Department has relied upon to frame the allegation as also copies of such documents as well as calculation sheets showing the duty calculations.

HOW TO DEAL WITH SHOW CAUSE NOTICES?
When you receive a show cause notice, you must check certain facts immediately:

1. Whether the notice is indeed addressed to you/your firm/ your company etc. Show cause notices are either delivered in person or through registered AD letters. Do not accept any show cause notice addressed to others. Suppose you receive a notice that is addressed to an ex-employee or an ex-partner, do not receive them on their behalf.
2. Check the date of issue of show cause notice and the day you receive it. Please put the actual date of receipt while acknowledging the receipt of a show cause notice. Do not accept the request to receive a notice back dated. The period within which a demand for duty is to be made or seized goods are proposed for confiscated are fixed.

Unless the department issues the notice within the period you are free from obligations. Therefore, if you backdate an acknowledgement, you run the risk of undertaking an obligation that was not on you. Read the show cause notice. If you agree with the charges (specially regarding the non-payment or short-payment of duty) you need not contest the notice. In that case you can inform the department about your admission and pay the duty demanded at the earliest. This would not only save you of the botheration and the legal expenses but also save you from some of the interest amount. There are also judicial rulings that in such cases you should be shown leniency as regards the penalties. In most of the cases you may feel that the charges made are incorrect and illegal. In these cases you should read the notice very carefully.

First, you should go through the facts that have been na in the show cause notice. Note down the discrepancies and note down the real facts. Secondly go through all the evidences put forth by the department in support of the charges. See whether there are any factual inaccuracies or whether the evidences have been obtained by force, coercion etc. In that case make a note of the same. Also think of the evidences that you can put forth to counter theses evidences.

For example if the show cause notice tries to prove excess production by showing particular quantum of consumption of electricity during a month, you may be able to show that there was a fault in the electric meter leading to an excessive billing. Also check as to how many of the evidences are gathered from external sources such as your transport or your buyer. These evidences are of lesser evidential value since they primarily reflect their activities and not your. These can be countered later by cross-examining the persons who have spoken against you. Also gather evidences that prove your innocence. In case you had discussed the issue with the central excise authorities earlier and had made your removals as per their directions or advice, try to obtain evidences which show such directions or clarification.

You should go through the list of the relied upon documents carefully. In many cases only a list of such documents is enclosed with the show cause notice. In that case you should make a formal request to the adjudicating authority for supply the copies of the same. The same holds good in case the copies of the documents given are not legible. Remember when you meet your legal counsel, he would definitely like to go through them. In case the issue involves more of a point of law, it is better to consult a legal expert in the field. Even otherwise, you may require his guidance for drafting of a proper reply. You must, however, remember that since you are the person who is in the know of the things, your participation in preparation of the reply alone can ensure a proper counter to the charges made.

You must also keep in mind that whether you win your case before the adjudicating authority or lose it, you are only winning or loosing a battle and not the war. Either you or the department may disagree with the decision given by the adjudicating authority and may go in for an appeal. However, the first reply made by you would remain an important document through out the proceedings and the higher (appellate) authority may raise objections if you introduced new facts / defence / arguments at that stage. Thus, preparation of a proper and self- contained first reply goes a long way in winning a case.

You must remember that though it is preferable to add colour to reply by using legal jargons and phrases, what clinches the issue is the clear presentation of facts, irrefutable evidences and recalling legal precedence. Like most of the Indian laws, central excise adjudication and appeal proceedings rely greatly on what higher appellate bodies and the courts (i.e. High courts and the Supreme Court) have decided in similar cases. The decisions and the observations of the courts while hearing cases with similar facts have a binding effect on the adjudicating officers or the lower appellate bodies. There are law journals available which gives these rulings in a codified manner. Nowadays even computer softwares are available to find out the decision in similar cases. You must ensure that your consultant is well stocked with these weapons and that he uses them while preparing the reply.

Similarly, the department itself, from time to time, issues circulars clarifying issues. Some of them may be in your favour. These can be of great help as they bind the adjudicating authority, being an officer of the department. You must make a sincere effort to send your reply within the stipulated time. If, however, it is not possible due to unavoidable reasons, you must seek time extension for doing the same. Normally no adjudicator would refuse it unless it is asked repeatedly and without much justification. Personal hearing usually follows written reply in the matter, unless the adjudicator is so convinced with your view that he passes order without any further reference.

A personal hearing gives you an opportunity to explain the details to the adjudicator in person. During the personal hearing you must accompany your counsel so as to ensure that all the points have been well covered. You can supplement his arguments if it is so required (especially cases involving complex technical facts- such process of production etc). Remember a proper reply to a show cause notice lays down the foundation of a sound decision. This would not only help you in the instant case but may go long way to solve your problems

BY SAVITA GAUTAM
EXIM AND CENEX CONSULTANT

Assessee who paid duty of one crore from Account current has to submit annual financial     information statement (ER4)

>> Click here to download word file of ER4