TaxTMI 
TaxTMI 
Instructions regarding Large Taxpayers Unit - reg.
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....duty, corporate tax/income tax and service tax. Notifications No. 18/2006-CE(NT) to 22/2006-CE(NT) and 28/2006-S.Tax all dated 30^th September 2006 have been issued providing jurisdictional authority for LTU and for making changes in the Central Excise Rules, 2002, Cenvat Credit Rules, 2004, and Service Tax Rules, 1994. The first LTU has been set up at Bangalore, and it has since commenced operation from 3^rd October, 2006. For carrying out legislative changes to give effect to various provisions and facilities with regard to a large tax payer, a new rule 12 BB has been inserted in the Central Excise Rules, 2002, a rule 12 A has been inserted in the Cenvat Credit Rules, 2004, and similarly, rule 10 has been inserted in the Service Tax Rules, 1994. In this way, it has been ensured that the amendments carried out are to the required minimum extent. 2. In this context, the important changes made in the rules and procedures with regard to LTUs are briefly given below: I. Receipt of Consent Form and its Acceptance: On receipt of the consent form from the large taxpayer, the Chief Commission....
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....manufacture of the finished goods and pay excise duty thereon. The said goods can be removed by the sender premises under an invoice or a transfer challan, which should contain all details as in case of an invoice except the value. However, the facility of such removal without payment of duty or reversal of credit is not permitted when the recipient unit is availing the benefit under specified area based exemption notification or where the sender premises is an EOU or a unit located in EHTP or STP. The rules in this regard may be studied carefully. IV. Transfer of credit: Rule 12A(4) of the Cenvat Credit Rules, 2004 provides an option to a large taxpayer to transfer Cenvat credit (of central excise duty or service tax) accumulated in one manufacturing unit or service providing unit to any of its other manufacturing or service providing units. Such transfer can be made by way of issue of a transfer challan containing the details as provided in the said sub-rule. The said transfer challan can be sent by fax or electronically by way of e-mail attaching the scanned copy of the challan to other unit for taking credit which should be followed by t....
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.... any difficulty in following the present export procedure and the said procedure will be sent to the Board for post-facto approval. However, in no case, export consignment should be held up for want of any procedural formalities. In case of sealing by the jurisdictional officers, it is clarified that the jurisdictional officers, whether of Customs or Central Excise, will continue to render the services of sealing as earlier. IX. Amendment in monthly returns (ER-1 return): The existing ER-1 form is being modified in order to capture certain details in respect of a large taxpayer. The details which are required to the given only by a large taxpayer shall be separately indicated. A suitable notification is being issued. The new format of ER-1 return would be applicable from the month of October, 2006 that is to be filed in November, 2006. X. Audit: Audit frequency norms have been fixed by the department for audit of units. However,a largetaxpayer who is liable to be audited every year would not be ordinarily audited annually. The selection of a taxpayer for audit would be done based on 'risk assessment' taking into account various....
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....required to be transferred to the LTU should be numbered both in the note sheet side and correspondence side. iv) For each of the pending case of arrears of revenue, the cases pending with the Commissioner (Appeals), CESTAT, High Court, Supreme Court, a note giving full facts of the case should be prepared for each case and then only the files should be transferred. In case of any time- bound matter like review of orders or filing of appeal or hearing of the cases in the Court, etc., the present jurisdictional Commissioner should handle the matters for the month of October, 2006, and thereafter, the cases should be transferred. For other time-bound matters, where the action is required to be taken in next one month, i.e., the month of November, 2006, the jurisdictional Commissionerate should send a d.o. letter explaining the relevant details of these cases. v) The cases under investigation should be handled by the present Commissionerate only and after issue of SCNs, the case records should be transferred to the LTU. In cases, where records of a particular case is voluminous, the Commissioner, LTU may be consulted in advance as to whether these rec....