Deputy Commissioner Stayed Order of Commissioner
THIS may look strange in a hierarchy conscious department, but it really happened some thirty years ago. A veteran consultant who has decades of association with the Department told me this incident:
The Collector (as the Commissioner was then called) of Central Excise had undertaken a factory visit (something that used to be a tradition in those days). While on his rounds he found that the assessee was making a consolidated entry in the EB 4 Account (Stock Account) at the end of the factory day (6 AM to 6 AM) pursuant to a concession. This had been granted earlier based on the fact that there were adequate supplementary records (bin cards etc) to trace any package deposited in the storeroom to its source and the RG I.
Since this concession was ordered to be withdrawn immediately there was complete chaos in the bonded storeroom accounting process. It was impractical for the reason that stocks were deposited in several store rooms within the factory at the same time and used to be internally transported from the packing area through multiple means by conveyors, fork lift trucks, covered trolleys etc.
With the withdrawal of the concession and given the volume of stocks to be handled on any factory-day the speed of deposit of stocks in the bonded store rooms and their despatch from the factory was reduced considerably affecting duty payments as well. This was an unsustainable situation from the market perspective.
The Collector was on leave and I met the Deputy Collector with all the facts and a written representation. He quickly reviewed my representation and understood the core issue. Having satisfied himself that there were sufficient safeguards, he issued instructions across the table to hold the order of the Collector in abeyance till such time as the matter is examined in depth once again and allowed the erstwhile practice to continue.
What happened after the Collector came back? Did the Deputy Collector lose his job?
This is what happened:
The matter was entrusted to an erudite Assistant Collector (who had authored books) and after a detailed study he produced a report that was a treatise by itself! From an implementation perspective this was away from the ground level issues that are faced day to day in a factory. Bonds and Bank Guarantees to be put in place with periodic scrutiny and a host of supplementary records besides those that were already in place. The remedy was more tortuous than the concession.
But time is a great healer. The report took about six months and by then the Collector had moved out and there was another dynamic "boss" who occupied the chair. When the report was put to him he did not hesitate a bit to restore the earlier practice of a consolidated entry in a combined EB 4 and RGI with all the then prevailing safeguards.
A happy ending after a laborious process!