CHAPTER 12
Special Procedure for Specified Goods
PART I
Stainless steel pattis/pattas,and Aluminium Circles
1. Introduction
1.1 Under rule 15 of the Central Excise (No.2) Rules, 2001 (hereinafter referred to as the ‘said Rules’), special central excise procedures have been framed with the view to facilitate the trade in specified goods, viz. Stainless Steel Patta Patties and Aluminium Circles. These procedures deal with all aspects of central excise such as payment of duty, maintenance of records, filing of returns etc.
2. Duty payable under special procedure
2.1 By Notification No. 34/2001-Central Excise dated 28.6.2001(effective from 1st July, 2001) an assessee shall have an option to pay the duty of excise on the basis of the cold rolling machine installed for the manufacture of Stainless steel pattis/pattas, falling under Chapter 72, or Aluminium circles falling under Chapter 76 of the First Schedule to the Central Excise Tariff Act, 1985(5 of 1986) by the process of cold rolling. The rates of duty per cold rolling machine, per month are, as follows :
| S.No. | Item | Rate of Duty per cold rolling machine per month |
|---|
| (i) | stainless steel pattis or pattas | Rs.1,500 |
| (ii) | aluminium circles produced from sheets manufactured on cold rolling machines | |
| (a) where the length of the roller is 30” or less | Rs. 7,500 |
| (b) where the length of the roller is more than 30” | Rs. 10,000 |
2.2 The rate of duty is fixed subject to the condition that no credit of duty paid on any raw materials, component part or machinery or finished products used for cold rolling of Stainless steel pattis/pattas, or Aluminium circles under CENVAT Credit Rules, 2001 shall be taken and further that the specified procedure is followed.
3. Application to avail special procedure
3.1 The manufacturer shall make an application in the form specified in Appendix-I to the said Notification No. 34/2001-Central Excise dated 28.6.2001to the Superintendent of Central Excise for this purpose and the Superintendent, may grant permission for the period in respect of which the application has been made.
3.2 The application shall be made so as to cover a period of not less than twelve consecutive calendar months, but permission may be granted for a shorter period for reasons to be recorded in writing, by the Deputy/Assistant Commissioner of Central Excise.
3.3 If at any time during such period the manufacturer fails to avail himself of the procedure contained in this notification, he shall, unless otherwise ordered by the Assistant Commissioner or the Deputy Commissioner, be precluded from availing himself of such procedure for a period of six months from the date of such failure.
3.4 If the manufacturer desires to avail himself of the procedure even after the expiry of the period for which his application was granted, he shall, before such expiry, make a fresh application to the Deputy/Assistant Commissioner of Central Excise and on his failure to do so, he shall, except as provided herein, be precluded from availing himself of such procedure for a period of six months from the date of such expiry.
3.5 An application made by a manufacturer, under erstwhile sub-rule (1) of rule 96ZA of the Central Excise Rules, 1944, shall be deemed to be an application made under the said Notification.
4. Discharge of duty liability on payment of certain sum.
4.1 A manufacturer whose application has been granted shall pay a sum calculated at the rate specified in the said notification, subject to the conditions therein laid down. Such payment shall be in full discharge of his liability for duty leviable on his production of such cold re-rolled Stainless steel pattas/pattis, or Aluminium circles during the period for which the said sum has been paid. However, if there is revision is revision in the rate of duty, the sum payable shall be recalculated on the basis of the revised rate, from the date of revision and liability for duty leviable on the production of the said goods from that date shall not be discharged unless the differential duty is paid. In the case the amount of duty so recalculated is less than the sum paid, the balance shall be refunded to the manufacturer:
4.2 When a manufacturer makes an application for the first time for availing the procedure contained in this notification, the duty liability for the month in which the application is granted shall be calculated pro-rata on the basis of the total number of days in that month and the number of days remaining in the month from the date of such grant.
4.3 The sum payable under the said notification shall be calculated by application of the appropriate rate to the maximum number of cold rolling machines installed by or on behalf of such manufacturer in one or more premises at any time during three calendar months immediately preceding the calendar month in which the application under the said notification is made.
4.4 The sum shall be tendered by the manufacturer along with the application.
5. Manufacturer’s declaration and accounts
5.1 The manufacturer who has been granted the required permission shall make an application in the form specified in
Annexure 29 to the said notification to the Superintendent in charge of the factory for permission to remove the Stainless steel pattis/pattas, or Aluminium circles from his premises during the ensuing month, declaring the maximum number of cold rolling machines installed by him or on his behalf, in one or more premises at any time during three calendar months immediately preceding the said calendar month in which such application is made.
5.2 If such application is not made to the Superintendent of Central Excise within the specified time limit, the manufacturer shall, unless, otherwise directed by the Deputy/Assistant Commissioner of Central Excise, and in exceptional circumstances, be liable to pay duty on his entire production of Stainless steel pattis/pattas, or Aluminium circles during the month or part thereof in respect of which the application was to be made, at the rate prescribed in the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) read with any relevant notification or notifications issued under sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944).
5.3 The manufacturer shall also intimate the Superintendent of Central Excise in writing of any proposed change in the number of cold rolling machines installed by him or on his behalf, and obtain the written approval of such officer before making any such change.
6. Exemption from certain provisions etc.
6.1 During the period in respect of which any manufacturer has been permitted to avail himself of the procedure of the said notification, he shall be exempt from the operation of rule 8 of the said Rules.
6.2 Except in accordance with such terms and conditions as the Central Government may by notification specify in this behalf, no rebate of excise duty shall be paid under rule 18 of the said Rules, in respect of any Stainless steel pattis/pattas, or Aluminium circles exported out of India, out of the stock produced by such manufacturer during such period.
7. Provisions regarding new factories and closed factories
7.1 In the case of a manufacturer who commences production for the first time or who recommences production after having ceased production for a continuous period of not less than three months, and who has been permitted by the Deputy/Assistant Commissioner of Central Excise to avail of the special procedure, the amount payable by him for the first month or part thereof, as the case may be, shall be provisionally calculated on the basis of his declaration of the maximum number of cold rolling machines that are or are likely to be installed by him or on his behalf during such period.
7.2 At the expiry of the period, the amount payable shall be recalculated on the basis of the maximum number of cold rolling machines actually installed and if the initial payment falls short of the total liability so determined, the deficiency shall be recovered from the manufacturer and where the total liability is less than the initial deposit, the balance shall be refunded to the manufacturer.
8. Power to condone failure to apply for special procedure
8.1 Notwithstanding anything contained in the said notification, the Additional/Joint Commissioner of Central Excise may, at his discretion, for reasons to be recorded in writing, and subject to such conditions as he may deem fit, apply the provisions contained in the said notification to a manufacturer who has failed to avail himself of the special procedure, or to comply with any condition laid down in this notification.
9. Provision regarding factories ceasing to work or opting for the normal procedure
9.1 Where a manufacturer who had availed himself of the special procedure contained in the said notification ceases to work ( i.e. for more than one or two shifts only) or reverts to the normal procedure, the duty payable by him in the month during which he has availed the procedure shall be calculated on the basis of the maximum number of cold rolling machines installed during the last month in the prescribed manner and the amount already paid for the month shall be adjusted towards the duty so calculated. If on such adjustment if there is any excess payment it shall be refunded to the manufacturer and any deficiency in duty shall be recovered from him.
10. Confiscation and penalty
10.1 If any manufacturer contravenes any provision of the said notification in respect of any excisable goods, then all such goods shall be liable to confiscation, and the manufacturer shall be liable to penalty under rule 25 of the said Rules.
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