Central Excise and Service Tax Registration - No Systems
THE CAG has conducted a study of the Registration Process in Central Excise and Service Tax and observed, "For both central excise and service tax, the registration certification has to be granted by the department within seven days of filing of an application. These processes are carried out through a centralised, web based software application known as Automation of Central Excise and Service Tax (ACES). This application is connected through MPLS14 network which automates various processes of central excise and service tax and gives complete end to end solution under various modules. Any assessee can register with the Department online, can file online returns, claims, permissions & intimations. The system tracks its status and the assessee gets online messages.
Online applications for registration are processed by the divisions/ ranges and registration certificates are issued through the system. In the case of central excise registrations, the divisional officers (AC/DC) mark the cases on-line for post facto physical verification of premises and other details given in application, by the concerned Range Officers."
Audit found instances of delays in issuing registration certificates and conducting post-verification, non-conversion of temporary registration numbers and delays/ shortcomings in the processing of applications for surrender of registrations such as non-availability of verification reports and lack of monitoring.
The department stated that delays occurred due to improper functioning of ACES system, non-submission/ delayed submission of complete records by the assessees, delay in verification of assessees' premises, heavy workload, connectivity failures and other administrative reasons.
Audit observed that ACES was not generating a report showing the date of forwarding the duplicate copy of the application from the division to the range for post facto verification and date of receipt of verification report, which would enable the divisions to monitor delays.
What happened to the Road? : In one case, the Audit found that "the range Superintendent had stated in his verification report that the assessee was operating from two separate premises which were part of the same factory but separated by a public road. This required the approval of the Commissioner." When Audit pointed out this, the department replied that ‘assesse resubmitted the ground plan which showed the factory premises as continuous and not separated by any road or canal. Thus, approval of Commissioner was not required', leaving the Audit confused as to what happened to the road.
Audit also noted that several temporary registrations were not converted into PAN based registrations.
Audit has recommended that:
1. Suitable control mechanisms may be put in place so as to prevent delays in granting registration certificates and accepting surrender of registration certificates.
2. The department may monitor the time taken for post facto verification of registration applications. Appropriate MIS report may be generated in ACES.