Retrospective Bungling - Discussions on Non Existing Statute - Height of Ignorance at highest Seat
BY Finance Act 2011, Section 73(b), the good Board fooled the Parliament into passing an impossible statute. Parliament amended the Third Schedule to the Central Excise Tariff Act and retrospectively added an entry 100A to the said schedule with effect from 29th April 2010. The idea was to retrospectively levy excise duty on packing, repacking of parts, components and assemblies of goods falling under tariff item 84264100, 8427, 8429, 843010.
To discuss the modalities of the scheme, nine Commissioners of Central Excise met in North Block in August 2011 under the Chairmanship of the JS, TRU. The meeting was also attended by other officers of the TRU.
This high level meeting decided that:-
++ If duty is charged on the packing, repacking, labelling, re-labelling & other such activities retrospectively, credit of duty paid on '"inputs" brought into the factory during the period and used in or in relation to manufacture of that products that were cleared during the period from 29th April, 2010 to 8th April 2011 should also be permitted. It was agreed by all the participants that CENVAT credit is available subject to the production of necessary duty paying documents prescribed in the Rules.
++ On the issue regarding the demand of interest of the duty paid retrospectively, it was pointed out by participants that the existing provisions of Central Excise law do not permit any waiver or relaxation.
All the learned Commissioners and the more learned JS, TRU were discussing a NON-ISSUE. The Board had committed a big blunder by amending the Third Schedule to the Central Excise Tariff Act instead of the Central Excise Act. There is no Third Schedule in the Central Excise Tariff Act!
And we had done our duty. More than five months ago, DDT 1599-02.05.2011 pointed out this lapse with the caption Retrospective Bungling by CBEC - Even Parliament Not Spared. We had also pointed out that Now the Board cannot get away with a retrospective corrigendum - after all this is an Act passed by Parliament and signed by the President of India and certainly an Under Secretary in the Board cannot issue a corrigendum to a document signed by the President of India!
In the field there are learned officers who will search the Tariff to find out a section of the Central Excise Act, but apparently, even in the Board, you have lawmakers who do not know which Act to amend and they live happily in their blissful ignorance holding meetings to decide how to implement a law that does not even exist due to their bungling.
CBEC F. No. 341/33/2011-TRU Dated: September 12, 2011