Draft - Seeking views on proposed measures to provide deterrence to tax evaders in the manufacturing sector

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....xcise & Service Tax,             All major Associations of Trade and Industries Sub : Seeking views on proposed measures to provide deterrence to tax evaders in the  manufacturing sector             The Central Board of Excise and Customs,over the years, has progressively simplified tax procedures regarding excise duty and made them trade facilitative. However, it has been noticed that these measures have not resulted in expected rise in the level of compliance. Even now, many cases are being booked, which indicate that certain classes of assessees continue to evade excise duty in a planned manner. In view of this, it ....

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....nion that cases of planned and deliberate evasion should invite swift action such as withdrawal of some of the facilities listed above for a specified period, with a view to create deterrence for planned evasion of duty, as also to encourage voluntarily tax compliance.  5. In this regard, it is proposed to take the following measures: 5.1 Type of offences, which would be covered under the present proposal: (a)  Removal of goods without documents and without payment of duty (b)  Undervaluation of goods where portion of sale proceeds, in excess of the invoice price, is received separately and remains unaccounted. (c)  Taking of CENVAT credit without receipt of goods specified in the document (d)....

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....d measures are deterrent in nature, it is proposed that the decision to withdraw the facilities should be taken at a senior level in the Government.    The decision to impose the restriction will be taken by the Member (Excise), Central Board of Excise & Customs. The proposal for withdrawal of the facilities will be forwarded by the jurisdictional Commissioner or Additional Director General (CEI) to the Chief Commissioner/Director General (CEI). The zonal Chief Commissioner/Director General (CEI) will examine the proposal after giving an opportunity to the assessee to present his case. After due consideration of the evidence on record, and the submissions made by the assessee, the CC/DG will forward his recommendations to the....