NOTIFICATION New Delhi, dated the 1st March,1997,
No. 6 / 97 - CENTRAL EXCISES (N.T.) 10 Phalguna, 1918 (Saka)
G.S.R. (E).- In exercise of the powers conferred by section
37 of the Central Excise Act, 1944 (1 of 1944), the Central
Government hereby makes the following rules further to amend the
Central Excise Rules, 1944, namely:-
1. (1) These rules may be called the Central Excise (
Amendment) Rules, 1997.
(2) They shall come into force on the date of their
publication in the Official Gazette.
2. In rule 2 of the Central Excise Rules, 1944 (hereinafter
referred to as the said rules), after clause (ix), the
following clause shall be inserted, namely:-
`(ixa) "procurer" means any person who receives molasses
manufactured in a khandsari sugar factory, whether directly from
such factory or otherwise, for use in the manufacture of any
commodity, whether or not excisable, and is liable for payment of
duty assessed on such molasses;'.
3. To rule 7 of the said rules, the following proviso shall be
added at the end, namely:-
"Provided that nothing contained in this rule shall apply to
molasses produced in a khandsari sugar factory.".
4. After rule 7 of the said rules , the following rule shall
be inserted , namely:-
"7A. Recovery of duty on molasses produced by a khandsari sugar
factory .- Every person who procures molasses produced in a
khandsari sugar factory, whether directly from such factory or
otherwise, for use in the manufacture of any commodity, whether
or not excisable, shall pay the duty or duties leviable on such
molasses, as if such molasses has been manufactured by the
procurer, at such time and to such persons as may be designated
under these rules, whether the payment of such duty or duties be
secured by bond or otherwise.".
5. In rule 9 of the said rules, in sub-rule (1), after the first
proviso, the following proviso shall be inserted, namely:-
"Provided further that the molasses produced in a khandsari sugar
factory may be removed without payment of duty leviable thereon
and the duty of excise leviable on such molasses shall be paid by
the procurer, as if such molasses has been manufactured by such
procurer, on the date of receipt of such molasses in his
factory.".
6. In rule 9A of the said rules, in sub-rule (1), -
(a) in clause (i) , the word "and" occurring at the end shall be
omitted;
(b) in clause (ii), for the word "warehouse.", the words
"warehouse; and", shall be substituted;
(c) after clause (ii), the following clause shall be inserted,
namely :-
"(iii) in the case of molasses manufactured in a khandsari sugar
factory, on the date of receipt of such molasses in the factory
of the procurer."
7. After rule 9B of the said rules, the following rule shall
be inserted , namely:-
"9C. Rules to apply to procurer .- The provisions of these
rules shall apply to a procurer of molasses as if such molasses
has been manufactured by him.".
8 . In Chapter V of the said rules, -
(a) for section AA, the following section shall be substituted,
namely:-
"AA. CREDIT OF DUTY PAID ON EXCISABLE GOODS USED AS INPUTS
57A. Applicability.- (l) The provisions of this section shall
apply to such finished excisable goods (hereafter, in this
section, referred to as the final products) as the Central
Government may, by notification in the Official Gazette, specify
in this behalf for the purpose of allowing credit of any duty of
excise or the additional duty under section 3 of the Customs
Tariff Act, 1975(51 of 1975), as may be specified in the said
notification (hereafter, in this section, referred to as the
specified duty) paid on the goods used in the manufacture of the
said final products (hereafter, in this section, referred to as
the inputs).
(2)The credit of specified duty allowed under sub-rule (l) shall
be utilised towards payment of duty of excise leviable on the
final products, whether under the Act or under any other Act, as
may be specified in the notification issued under sub-rule (1)
and subject to the provisions of this section and the conditions
and restrictions, if any, specified in the said notification.
(3) The Central Government may also specify in the said
notification the goods or classes of goods in respect of which
the credit of specified duty may be restricted.
(4) The credit of specified duty under this section shall be
allowed on inputs used in the manufacture of final products as
well as on inputs used in or in relation to the manufacture of
the final products whether directly or indirectly and whether
contained in the final product or not.
(5) Notwithstanding anything contained in sub-rule (1), the
Central Government may, by notification in the Official Gazette
declare the inputs on which declared duties of excise or
additional duty (hereinafter referred to as declared duty) paid
shall be deemed to have been paid at such rate or equivalent to
such amount as may be specified in the said notification and
allow the credit of such declared duty deemed to have been paid
in such manner and subject to such conditions as may be specified
in the said notification even if the declared inputs are not used
directly by the manufacturer of final products declared in the
said notification, but are contained in the said final products.
Explanation.- For the purposes of the sub-rule, it is clarified
that even if the declared inputs are used directly by a
manufacturer of final products, the credit of the declared duty
shall, notwithstanding the actual amount of duty paid on such
declared inputs, be deemed to be equivalent to the amount
specified in the said notification and the credit of the declared
duty shall be allowed to such manufacturer.
57B. Eligibility of Credit of duty on certain goods. -(1)
Notwithstanding anything contained in rule 57A, the manufacturer
of final products shall be allowed to take credit of the
specified duty paid on the following goods, used in or in
relation to the manufacture of the final products, whether
directly or indirectly and whether contained in the final
products or not, namely:-
(i) goods which are manufactured and used within the factory
of production;
(ii) paints;
(iii) goods used as fuel;
(iv) goods used for generation of electricity or steam, used
for manufacture of final products or for any other purpose,
within the factory of production;
(v) packing materials and materials from which such packing
materials are made provided the cost of such packing
materials is included in the value of the final product;
(vi) accessories of the final product cleared alongwith
such final product, the value of which is included in the
assessable value of the final product.
(2) The manufacturer of the final products shall not be allowed
to take credit of the duty paid on the following goods, namely:-
(i) machines, machinery, equipment, apparatus, tools,
appliances or capital goods as defined in rule 57Q (other
than those used as component parts in the manufacture of
final products), used for any purpose in the factory;
(ii) packing materials in respect of which any exemption
to the extent of the duty of excise payable on the cost of
the packing materials is being availed of for packing any
final products;
(iii) packing materials or containers, the cost of which is
not included in the value of the final products under
section 4 of the Act;
(iv) crates and glass bottles used for aerated water; and
(v) lubricating oils, greases, cutting oils and coolants.
57C. Credit of duty not to be allowed if final products are
exempt. - (1) No credit of the specified duty shall be allowed
on such quantity of inputs which is used in the manufacture of
final products on which no amount of excise duty is payable for
any reason except when the final products are either,-
(i) cleared to a unit in a Free Trade Zone; or
(ii) cleared to a hundred per cent. export-oriented
undertaking; or
(iii) cleared to a unit in an Electronic Hardware Technology
Park or Software Technology Parks; or (iv) supplied to the
United Nations or an international organisation for their
official use or supplied to projects funded by them, on
which exemption of duty is available under notification of
the Government of India in the Ministry of Finance
(Department of Revenue) No.108/95-Central Excises, dated the
28th August, 1995.
(2) Where a manufacturer avails of the credit of specified duty
on any inputs and he is engaged in the manufacture of any final
product which is chargeable to duty as well as in the manufacture
of any other final product which is not chargeable to duty in the
same factory, the provisions of sub-rule (1) shall be deemed to
be satisfied only when the manufacturer follows the procedure
prescribed in sub-rule (1) of rule 57CC or the provisions of sub-
rule (9) of that rule are complied with.
(3) Sub-rule (2) shall not apply to inputs intended to be used
as fuel.
(4) Sub-rule (2) shall also not apply when the final product
manufactured by the manufacturer is exempt from duty of excise on
account of the fact that it is cleared to a unit in a free trade
zone or to a hundred per cent. export-oriented undertaking or to
a unit in an Electronic Hardware Technology Park or Software
Technology Parks or supplied to the United Nations or an
international organisation for their official use or supplied to
projects funded by them, on which exemption of duty is available
under notification of the Government of India in the Ministry of
Finance (Department of Revenue) No.108/95-Central Excises, dated
the 28th August, 1995.
57CC. Adjustment of credit on inputs used in exempted final
products or maintenance of separate inventory and accounts of
inputs by the manufacturer - (1) Where a manufacturer is engaged
in the manufacture of any final product which is chargeable to
duty as well as in any other final product which is not
chargeable to duty and the manufacturer takes credit of the
specified duty on any inputs (other than inputs used as fuel)
which is used or ordinarily used in or in relation to the
manufacture of both the aforesaid categories of final products,
whether directly or indirectly and whether contained in the said
final products or not, the manufacturer shall, unless the
provisions of sub-rule (9) are complied with, pay an amount equal
to eight per cent. of the price (excluding sales tax and other
taxes, if any, payable on such goods) of the second category of
final products charged by the manufacturer for the sale of such
goods at the time of their clearance from the factory.
(2) The amount mentioned in sub-rule (1) shall be paid by the
manufacturer by adjustment in the credit account maintained under
sub-rule (7) of rule 57G or in the accounts maintained under rule
9 or sub-rule (1) of rule 173G and if such adjustment is not
possible for any reason, the amount shall be paid in cash by the
manufacturer availing of credit under rule 57A.
(3) The provisions of sub-rule (1) shall not apply to final
products falling under Chapters 50 to 63 of the Schedule to the
Central Excise Tariff Act, 1985 (5 of 1986).
(4) The provisions of sub-rule (1) shall also not apply to -
(a) articles of plastics falling within Chapter 39;
(b) tyres of a kind used on animal drawn vehicles or
handcarts and their tubes, falling within Chapter 40;
(c) Black and White television sets, falling within Chapter
85; and
(d) Newsprint, in rolls or sheets, falling within Chapter
heading No.48.01;
which are exempt from the whole of the duty of excise
leviable thereon or chargeable to nil rate of duty.
(5) In the case of final products referred to in sub-rule (3) or
sub-rule (4) and excluded from the provisions of sub-rule (1),
the manufacturer shall pay an amount equivalent to the credit of
duty attributable to inputs contained in such final products at
the time of their clearance from the factory.
(6) The provisions of sub-rule (1) shall also not apply to final
products which are exported under bond in terms of the provisions
of rule 13.
(7) The provisions of sub-rule (1) shall apply even if the inputs
on which credit has been taken are not actually used or contained
in any particular clearance of final products.
(8) If any goods are not sold by the manufacturer at the factory
gate but are sold from a depot or from the premises of a
consignment agent or from any other premises, the price
(excluding sales tax and other taxes, if any, payable) at which
such goods are ordinarily sold by the manufacturer from such
depot or from the premises of a consignment agent or from any
other premises shall be deemed to be the price for the purpose of
sub-rule (1) .
(9) In respect of inputs (other than inputs used as fuel) which
are used in or in relation to the manufacture of any goods, which
are exempt from the whole of the duty of excise leviable thereon
or chargeable to nil rate of duty, the manufacturer shall
maintain separate inventory and accounts of the receipt and use
of inputs for the aforesaid purpose and shall not take credit of
the specified duty paid on such inputs.
57D. Credit of duty not to be denied or varied in certain
circumstances. - (1) Credit of specified duty shall not be denied
or varied on the ground that part of the inputs is contained in
any waste, refuse, or by-product arising during the manufacture
of the final product, or that the inputs have become waste during
the course of manufacture of the final product, whether or not
such waste or refuse or by-product is exempt from the whole of
the duty of excise leviable thereon or chargeable to nil rate of
duty or is not specified as a final product under rule 57A.
(2) Credit of specified duty shall also not be denied or varied
in case any intermediate products have come into existence during
the course of manufacture of final products or the inputs are
used in the manufacture of capital goods as defined in rule 57Q
and such intermediate products or capital goods are not
chargeable to duty of excise.
57E. Adjustment in duty credit. - (1) If a manufacturer of final
products has taken credit on any inputs and subsequently it so
happens that any refund of the duty paid by the manufacturer of
inputs or importer of inputs, as the case may be, is allowed to
him for any reason, then the manufacturer of the final products
shall accordingly adjust the amount of credit in his credit
account and if such adjustment is not possible for any reason,
the manufacturer of the final products shall pay the amount in
cash equal to the amount of refund allowed to the manufacturer of
inputs or importer of inputs.
(2) If a manufacturer of the final products has not taken any
credit or has taken credit on any inputs and subsequently it so
happens that any additional amount of duty is recovered by the
manufacturer of such inputs or importer of such inputs in respect
of such inputs, then the manufacturer of the final products shall
be allowed an additional credit equal to the amount of duty so
recovered, if the manufacturer or importer of such inputs has
passed on the incidence of the additional amount of duty to the
manufacturer of final products.
(3) The provisions of sub-rule (2) shall not apply in cases
where the additional amount of duty became recoverable from the
manufacturer or importer of inputs on account of any short levy
or non-levy by reason of fraud, collusion or any wilful mis-
statement or suppression of facts or contravention of any
provisions of the Act or rules made thereunder with intent to
evade payment of duty.
(4) No additional credit under sub-rule (2) shall be allowed to a
manufacturer of the final products unless he produces a
cert ificate issued by the Superintendent of Central Excise having
jurisdiction over the factory of the manufacturer of inputs or,
as the case may be, by the proper officer in the customs area,
from where such inputs were originally cleared.
(5) The certificate required to be produced under sub-rule (4)
shall indicate the full description of the inputs, original duty
paid and the particulars of the documents under which the inputs
were cleared from the factory or, as the case may be, from the
customs area and also the particulars of differential duty
recovered from the manufacturer or the importer.
57F. Manner of utilisation of inputs and the credit allowed in
respect of duty paid thereon. - (1) The inputs on which credit
has been taken may be used in or in relation to the manufacture
of final products.
(2) The inputs may be removed, after intimating the Assistant
Commissioner of Central Excise concerned, in writing, for home
consumption or for export under bond.
(3) All removals of inputs for home consumption shall be made -
(a) on payment of duty equal to the amount of credit availed
in respect of such inputs; and
(b) under the cover of invoice prescribed under rule 52A.
(4) The inputs can also be removed as such or after they have
been partially processed by the manufacturer of the final
products to a place outside his factory under the cover of a
challan specified in this behalf by the Central Board of Excise
and Customs, for the purposes of test, repair, refining, re-
conditioning or carrying out any other operation necessary for
the manufacture of the final products or for manufacture of
intermediate products necessary for the manufacture of final
products and return the same to his factory within a period of
sixty days or such extended period as the Assistant Commissioner
of Central Excise may allow in this behalf, for,-
(I) further use in the manufacture of the final product; or
(ii) removing after payment of duty for home consumption;
or
(iii) removing the same without payment of duty under bond
for export.
(5) (i) The waste, if any, arising in the course of any operation
mentioned in sub-rule (4) shall be returned to the factory of the
manufacturer of final products.
(ii) No such waste as is referred to in clause (i) is required
to be returned to the factory of the manufacturer of final
products if the excise duty payable on such waste is paid.
(6) (i) Where a manufacturer removes the inputs as such or in
the partially processed form to a place outside his factory for
the purposes specified in sub-rule (4), the manufacturer shall do
so only after debiting an amount equal to ten per cent. of the
value of such inputs or, as the case may be, the partially
processed inputs declared by him on the challan under which such
inputs or partially processed inputs are cleared from his
factory.
(ii) The debit shall be made in the account maintained under sub-
rule (7) of rule 57G or the account-current maintained under rule
9 or sub-rule (1) of rule 173G.
(7) Notwithstanding anything contained in rule 57A, the
manufacturer shall be eligible to take credit of an amount equal
to the amount debited by him under sub-rule (6) when the inputs
or partially processed inputs, as the case may be, are received
back in full in his factory, in the account maintained under sub-
rule (7) of rule 57G.
(8) A manufacturer shall take credit under sub-rule (7) only
after the entire quantity of the inputs or the partially
processed inputs, as the case may be, but excluding the waste, if
any, arising in the course of operation outside the factory of
the manufacturer, or otherwise, is received back in his factory.
(9) A manufacturer shall not take credit under sub-rule (7)
unless the inputs or the partially processed inputs are received
back in his factory under the cover of the duplicate copy of the
challan on which such inputs or partially processed inputs were
removed from his factory.
(10) If the Assistant Commissioner of Central Excise is satisfied
that the duplicate copy of the challan has been lost in transit,
he may allow a manufacturer of final products to take credit
under sub-rule (7) on the basis of the triplicate copy of the
challan.
(11) If the inputs or partially processed inputs are not received
back in the factory of the manufacturer of final products within
a period of sixty days or the extended period, as may be allowed
by the Assistant Commissioner of Central Excise, the manufacturer
shall recalculate the amount of actual credit attributable to
such inputs or on inputs contained in the partially processed
inputs and thereafter he shall adjust the differential amount, if
any, after taking into account the amount already debited while
sending the inputs or partially processed inputs from his
factory.
(12) Credit of specified duty allowed in respect of any inputs
may be utilised by the manufacturer of the final products towards
payment of duty of excise on any of the following, namely:-
(a) on any of the final products in the manufacture of which
such inputs are intended to be used in accordance with the
declaration filed under rule 57G; or
(b) on the waste, if any, arising in the course of
manufacture of the final products; or
(c) on the inputs themselves if such inputs are removed as
such under sub-rule (4).
(13) Where any inputs are used in the final products which are
cleared for export under bond or used in the intermediate
products cleared for export in accordance with sub-rule (4), the
credit of specified duty in respect of the inputs so used shall
be allowed to be utilised by the manufacturer towards payment of
duty of excise on any final products cleared for home consumption
or for export on payment of duty and where for any reason such
adjustment is not possible, the manufacturer shall be allowed
refund of such amount subject to such safeguards, conditions and
limitations as may be specified by the Central Government by
notification in the Official Gazette.
(14) No refund of credit mentioned in sub-rule (13) shall be
allowed if the manufacturer avails of drawback allowed under the
Customs and Central Excise Duties Drawback Rules, 1995, or claims
a rebate of duty under rule 12, in respect of such duty.
(15) Where any inputs are used in the final products cleared
either to a unit in a free trade zone or to a unit of a hundred
per cent. export oriented undertaking or to a unit in an
Electronic Hardware Technology Park or to a unit in Software
Technology Parks or supplied to the United Nations or an
International Organisation for their official use or supplied to
projects funded by them, on which exemption of duty is available
under notification of the Government of India in the Ministry of
Finance (Department of Revenue) No.108/95-Central Excises, dated
the 28th August, 1995, under bond, the credit of specified duty
in respect of such inputs shall be allowed to the manufacturer.
The credit so allowed can be used for payment of duty on any
final product.
(16) The manufacturer shall also be allowed to utilise the credit
of specified duties towards adjustment of the credit, as required
to be made under sub-rule (6) or rule 57CC.
(17) Notwithstanding anything contained in sub-rule (12) or rule
57A, any credit of specified duty lying unutilised, -
(a) on the sixteenth day of March, 1995, with the manufacturer
of tractors falling under heading No.87.01 or motor vehicles
falling under heading Nos.87.02 and 87.04 or chassis of such
tractors or such motor vehicles falling under heading No.87.06
of the Schedule to the Central Excise Tariff Act, 1985 (5 of
1986) shall lapse and shall not be allowed to be utilised for
payment of duty on any excisable goods, whether cleared for home
consumption or for export: Provided that nothing contained in
this clause shall apply to credit of duty, if any, in respect of
inputs lying in stock or contained in finished products lying in
stock on the sixteenth day of March, 1995;
(b) on the first day of March 1997, with the manufacturer of bulk
drugs falling under Chapters 28 or 29 and with the manufacturers
of black and white picture tubes falling under sub-heading
No.8540.12 shall lapse and shall not be allowed to be utilised
for payment of duty on any excisable goods, whether cleared for
home consumption or for export:
Provided that nothing contained in this clause shall apply to
credit of duty, if any, in respect of inputs lying in stock or
contained in finished products lying in stock on the first day of
March, 1997.
(18) Any waste, arising from the processing of inputs, in respect
of which credit has been taken may be-
(a) removed on payment of duty as if such waste is manufactured
in the factory; or
(b) removed without payment of duty, where such waste belongs to
such class or category of wastes as the Central Government may,
from time to time, by notification in the Official Gazette,
specify for the purpose of being used in the manufacture of the
class or categories of goods as may be specified in the said
notification, subject to the procedure under Chapter X being
followed; or
(c) destroyed in the presence of the proper officer on the
application by the manufacturer and if found unfit for further
use, or not worth the duty payable thereon, the duty payable
thereon being remitted.
(19) The waste as referred to in sub-rule (18) may be destroyed
by the manufacturer governed by Chapter VIIA after informing the
proper officer in writing indicating therein the quantity of such
waste and the date on which he proposes to destroy the waste, at
least seven days in advance and after observing such further
conditions as may be specified by the Commissioner by a general
or special order with regard to the manner of disposal of such
waste.
(20) On an application made by a manufacturer of the final
products, the Commissioner may, subject to such conditions and
limitations as he may impose, permit a manufacturer having credit
in his account in Form R.G.23-A maintained under rule 57G and
lying unutilised, on account of shifting of the factory belonging
to the manufacturer, to another site, or on account of change in
ownership, or change in the site of a factory resulting from
sale, merger, amalgamation or transfer to a joint venture with
the specific provision for transfer of liabilities of the old
factory, to transfer such unutilised credit to such transferred,
sold, merged or amalgamated factory.
(21) The credit under sub-rule (20) shall be allowed only if the
stock of inputs as such or in process is also transferred along
with the factory to the new site or ownership and the inputs on
which credit has been availed of are duly accounted for to the
satisfaction of the Commissioner.
57G. Procedure to be observed by the manufacturer. - (1) Every
manufacturer intending to take credit of the duty paid on inputs
under rule 57A, shall file a declaration with the Assistant
Commissioner of Central Excise having jurisdiction over his
factory, indicating the description of the final products
manufactured in his factory and the inputs intended to be used in
the said final products and such other information as the said
Assistant Commissioner may require, and obtain a dated
acknowledgement of the said declaration.
(2) A manufacturer who has filed a declaration under sub-rule (1)
may, after obtaining the acknowledgement aforesaid, take credit
of the duty on the inputs received by him.
(3) No credit under sub-rule (2), shall be taken by the
manufacturer unless the inputs are received in the factory under
the cover of any of the following documents, namely:-(a) an
invoice issued by a manufacturer of inputs under rule 52A or 100E
of the said rules;
(b) an invoice issued by the manufacturer of inputs from his
depot or from the premises of the consignment agent of the said
manufacturer or from any other premises from where the goods are
sold by or on behalf of the said manufacturer provided the depot
or the premises, as the case may be, is registered under rule
174;
(c) triplicate copy of a bill of entry;
(d) a certificate issued by an Appraiser of Customs posted in
foreign post office;
(e) an invoice issued by a first stage dealer of excisable goods,
registered under rule 174;
(f) an invoice issued by a second stage dealer of excisable goods
registered under rule 174 and duly authenticated by the proper
officer;
(g) an invoice issued by a dealer on or before the 31st day of
August, 1996;
(h) an invoice issued by an importer registered under rule 174
and duly authenticated by the proper officer;
(i) an invoice issued by an importer from his depot or from the
premises of the consignment agent of the said importer provided
the said depot or the premises, as the case may be, is
registered under rule 174, and duly authenticated by the proper
officer;
(j) an invoice issued by a first stage or second stage dealer of
imported goods registered under rule 174 and duly authenticated
by the proper officer;
(k) duplicate copy of a bill of entry generated on Electronic
Data Interchange System installed in any customs or central
excise Commissionerate;
(l) a certificate issued by the Superintendent of Central Excise
or by the proper officer in the Customs area under rule 57E; and
(m) an invoice issued by a manufacturer of final products
under sub-rule (3) of rule 57F or sub-rule (1) of rule 57S.
Explanation.- For the purposes of this section,-
(i) "first stage dealer" means a dealer who purchases the goods
directly from -
(a) the manufacturer under the cover of an invoice issued under
rule 52A or rule 100E or from the depot of the said
manufacturer, or from premises of the consignment agent of the
said manufacturer or from any other premises from where the goods
are sold by or on behalf of the said manufacturer, under cover of
an invoice issued under rule 57G; or
(b) an importer or from the depot of an importer or from the
premises of the consignment agent of the importer, under cover
of an invoice issued under rule 57G.
(ii) "second stage dealer" means a dealer who purchases the
goods from a first stage dealer.
(4) No credit shall be taken by the manufacturer in respect of
invoices referred to in clause (g) of sub-rule (3) after the 30th
September, 1996.
(5) Credit shall also not be taken by the manufacturer after six
months of the date of issue of any document specified in sub-rule
(3) and where the intermediate products manufactured by the user
of inputs specified under rule 57J are received by the
manufacturer, after nine months.
(6) Notwithstanding anything contained in sub-rule (2) or rule
52A, a manufacturer may take credit on inputs received in his
factory on the basis of original invoice, if duplicate copy of
the invoice has been lost in transit, subject to the satisfaction
of the Assistant Commissioner that the inputs have been received
in his factory and the duty was paid on such inputs.
(7) A manufacturer of the final products shall maintain,-
(a) an account in Form R.G.23A, Parts I and II; (b) in respect
of duty payable on final products, an account-current with
adequate balance to cover the duty of excise payable on the final
products cleared at any time.
(8) A manufacturer of final products shall submit within five
days after the close of each month to the Superintendent of
Central Excise, a monthly return indicating the particulars of
inputs received during the month and the amount of credit taken.
The manufacturer shall also submit original duty paying documents
and extracts of Part I and Part II of Form R.G.23A maintained
alongwith the monthly return:
Provided that the Commissioner may, having regard to the nature,
variety and extent of productionor manufacture of frequency of
removals -
(I) fix in relation to any assessee or class of assessees a
period shorter than one month for filing the aforesaid return;
(ii) permit that the aforesaid return may be filed by the
assessee within a period not exceeding twenty-one days after the
close of each month:
Provided further that in respect of a manufacturer availing of
any exemption based on the value or quantity of clearances in a
financial year, the provisions of this sub-rule shall have effect
in that financial year as if for the expression "month", the
expression "quarter" were substituted.
(9) Where a manufacturer was, for sufficient reasons, not in a
position to make a declaration under sub-rule (1) and makes the
declaration subsequently, the Assistant Commissioner may, subject
to the provisions of sub-rule (10) and for reasons to be recorded
in writing, condone the delay in filing of such declarations and
allow the manufacturer to take credit of the duty already paid on
the inputs.
(10) The Assistant Commissioner shall not condone the delay
unless he is satisfied that: (i) the inputs were received in the
factory not before a period of six months from the date of filing
of such declaration;
(ii) the amount of duty for which credit is sought has actually
been paid on such inputs; and
(iii) the inputs have actually been used or are to be used in the
manufacture of final products.
57GG. Procedure to be followed by persons issuing invoices under
rule 57G or rule 57T. - (1) Every person, who issues invoices
under rule 57G or, as the case may be, under rule 57T, shall get
registered under rule 174.
(2) Every person registered for the purposes of this rule
(hereafter in this section referred to as the registered person)
shall maintain a stock account in Form R.G.23D.
(3) The registered person shall maintain the R.G.-23D register at
the end of the day of receipt and issue of excisable goods, and
shall -
(a) at the time of making any entry, insert the date when the
entry is made; (b) correctly keep such book, account or register
in the manner required, under these rules and shall not cancel,
obliterate, or alter any entry therein, except for correction of
any errors;
(c) keep the book, account or register ready for inspection by
the officers, and shall permit any officer to inspect it and make
such minute therein or take any extract therefrom, as such
officer may think fit;
(d) at any time, if demanded by the officer, send the records
referred to in clause (c), to the proper officer.
(4) The registered person shall issue an invoice containing such
details as may be specified by the Central Board of Excise and
Customs or the Commissioner.
(5) (a) The invoice shall be made out in quadruplicate. The
copies of the invoice shall be marked at the top in bold capital
letters in the following manner, namely:-
(i) The original copy shall be marked as ORIGINAL FOR BUYER
and that copy shall be given to the buyer.
(ii) The duplicate copy shall be marked as DUPLICATE FOR
TRANSPORTER and that copy shall be used for taking credit
under rule 57G or, as the case may be, for making receipt
entries in register maintained under this rule.
(iii) The triplicate copy shall be marked as TRIPLICATE FOR
CENTRAL EXCISE and that copy shall be sent to the proper
officer.
(iv) The quadruplicate copy shall be marked as
QUADRUPLICATE FOR REGISTERED PERSON and that copy shall be
retained by the registered person for his record.
(b) The copies of the invoices issued by a first stage
dealer and a second stage dealer shall also be marked at the
top in bold capital letters as FIRST STAGE DEALER and SECOND
STAGE DEALER respectively.
(6) (i) Each invoice shall bear a printed serial number running
for the whole financial year beginning on the 1st April of each
year.
(ii) The registered person shall use only one invoice book at any
one time unless otherwise permitted by the Commissioner in
writing.
(7) (i) Each foil of the invoice book shall be authenticated by
the owner or the working partner or the Managing Director or the
Company Secretary, before being used by the registered person.
(ii) The registered person shall intimate the serial number of
the invoice before being used to the Assistant Commissioner of
Central Excise and the dated acknowledgement of receipt of such
intimation shall be retained by the said registered person.
(8) (i) It shall be permissible to use records and invoices
generated through computers.
(ii) When the invoice is generated through a computer, the
registered person shall intimate the serial number likely to be
used in the forthcoming quarter and as soon as the same is
exhausted, a revised intimation shall be sent.
(iii) The registered person shall also send details of the
software used including the format used for information of the
Assistant Commissioner.
(9) (i) The registered person shall issue only one invoice in
respect of the consignment if all the packages comprising the
said consignment are despatched in one lot at any one time.
(ii) If a consignment is split up into two or more lots and each
such consignment is despatched separately either on the same day
or on different days, a separate invoice shall be made out in
respect of each lot.
(iii) Separate invoice shall be issued in case a consignment is
loaded on more than one vehicle, vessel, pack animal or other
means of conveyance which do not travel together but travel
separately or at intervals.
(10) The registered person shall, within seven days after the
close of each month, submit to the Range Superintendent, a
monthly return and other documents as the Central Board of Excise
and Customs or the Commissioner may specify, for the purpose of
verification by the said Range Superintendent.
(11) The registered person shall preserve documents specified
under rule 57GG for a period of five years and shall, on demand,
produce the same to the Central Excise officer.(12) The
registered person shall, within seven days of close of each
month, submit duplicate copies of the invoices issued under rule
52A or 57G to the Superintendent of Central Excise with whom such
person is registered, and -
(a) where the entire quantity shown in the invoice has been
sold, deface the same with the remarks `MODVAT ALLOWED - NOT
TO BE USED AGAIN'; and
(b) where the entire quantity has not been sold, the Range
Superintendent shall endorse on the back of the invoice,
details relating to the quantity received, quantity issued,
total amount of duty available as input stage credit
(hereafter referred to as the said duty), amount of the said
duty for which invoices have been issued, and the balance
quantity and the balance amount of the said duty available
for issuing invoices.
57H Transitional provisions.- (1) Notwithstanding anything
contained in rule 57G, a manufacturer intending to avail of
credit of duty paid on inputs received him immediately before
obtaining the dated acknowledgement of the declaration made under
that rule, shall file a declaration under this sub-rule with the
jurisdictional Assistant Commissioner of Central Excise stating
that-
(a) such inputs are lying in stock, or are received in the
factory after filing the declaration made under rule 57G; or
(b) such inputs are used in the manufacture of final
products which are cleared from the factory after filing the
declaration made under rule 57G,
and that no credit has been taken by the manufacturer in respect
of such inputs under any other rule or notification.
(2) The credit under sub-rule (1) shall not be available in case
the final product is exempt from the whole of the duty of excise
leviable thereon or is chargeable to nil rate of duty.
(3) Every manufacturer who, immediately before filing a
declaration under rule 57G, has been availing of , -
(a) the special procedure under rule 56A, in respect of
materials or component parts for use in the manufacture of
finished excisable goods; or
(b) an exemption for giving credit with respect to the duty
paid on the materials or component parts used in the manufacture
of finished excisable goods, shall file a declaration under this
sub-rule with the Assistant Commissioner of Central Excise having
jurisdiction over his factory, stating that he intends to
transfer credit of duty paid on the said materials or component
parts received by such manufacturer and lying unutilised
immediately before obtaining the dated acknowledgement of the
declaration made under rule 57G in his account in R.G.23 to his
account in R.G. 23A.
(4) Transfer of credit under sub-rule (3) shall be allowed if
the materials and component parts and the finished excisable
goods have been specified as inputs and final products,
respectively, in the notification issued under rule 57A.
(5) A manufacturer who has filed a declaration under sub-rule
(1) or sub-rule (3) may, after obtaining the dated
acknowledgement as aforesaid, take credit of the duty paid on the
inputs received by him.
(6) The manufacturer shall take credit under sub-rule (5) only
if the inputs were received in the factory under the cover of a
document as specified under rule 57G evidencing the payment of
duty on such inputs and such evidence is made available by the
assessee to the Assistant Commissioner of Central Excise.
(7) A manufacturer who opts for exemption from the whole of the
duty of excise leviable on goods manufactured by him under a
notification based on the value or quantity of clearances in a
financial year, and who has been availing of the credit of the
duty paid on inputs before such option is exercised, shall be
required to pay an amount equivalent to the credit, if any,
allowed to him in respect of inputs lying in stock or used in any
finished excisable goods lying in stock on the date when such
option is exercised and after deducting the said amount from the
balance, if any, lying in his credit, the balance, if any, still
remaining shall lapse and shall not be allowed to be utilised for
payment of duty on any excisable goods, whether cleared for home
consumption or for export.