AMOUNT DEPOSIT IN PLA

[SNEHAL SHAH]

Sir,

We are Chemical mfg & Last 6 Months due to recession sales is slow down & due to another material production we are purchsing Raw material , so CENVAT accumulated .

Due to above reason we are debit Cenvat through A P II , CPII & Balance Service tax but not in PLA .

Range suptd. pressurising that u can paid duty through PLA otherewise u can face lots of problem .

Now my confusion is that , is it mandatory to debit duty PLA ? if we can not pay through PLA is it any Excise litigation face our unit.

Please guide & revert your valuable reply .

SACHIN

[YAGAY andSUN]

If there is accumalation of CENVAT credit then you can pay duty through credit  account.  There is no hard and fast rule that Central Excise duties must be paid only from PLA.  If you are paying central excise duty from Credit account then Range Superintendent can force you to pay it through PLA.

 

[NEERAJ KUMAR, RANCHI]

No as per provision it is not mandatory to pay duty through PLA.

[Joginder Pal]

Hi Mr. Shah,

 It is not clear what reason the Range Supdtt. is giving  about the problem you are likely to face if you pay excise duty by debit of CENVAT account. There is no compelsion that the unit must pay duty through PLA only. The only reason coming to my mind is that Excice department has some targets of Excise Duty collection, which are effected if the assessees pay duty through CENVAT credit. Generally such suggestions come from Excise Deptt during Jan to March every year so that they can fulfil their yearly targets of duty collection. You should ask the Range Supdtt to explain you reason for such direction. In case it is due to the above stated reason, you should decide keeping on mind your relations with the Excise and your finantial viability of helping Excise Deptt.- JOGINDER PAL

AI Summary

Chemical Company Accumulates CENVAT Credit, Pressured to Pay Duties via PLA; Investigate Excise Department Motives A chemical manufacturing company is experiencing slow sales and accumulating CENVAT credit due to purchasing raw materials for different production. The company is using CENVAT credit to pay duties instead of through the Personal Ledger Account (PLA), as pressured by the Range Superintendent. Responses indicate that it is not mandatory to pay duties through PLA, and the Range Superintendent may be motivated by departmental targets. It is suggested that the company inquire about the specific reasons for the pressure and consider its relationship with the Excise Department and financial situation when deciding how to proceed.