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 and SUN]

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

Payment of excise duty: duty may be discharged from accumulated CENVAT credit rather than only from PLA.
No statutory obligation requires payment of central excise duty solely from the Principal Ledger Account (PLA); where CENVAT credit has accumulated, duty may be discharged by debiting the CENVAT account. Instructions from a Range Superintendent to pay through PLA are administrative and may reflect departmental collection preferences or targets rather than a legal compulsion.