CBEC Action Plan to Reduce Litigation
YESTERDAY DDT reported about the CBEC Member's instructions on the action plan to reduce litigation.
Once upon a time the Show Cause Notice in Central Excise used to be issued by all officers of and above the rank of Superintendent. If extended period of limitation had to be invoked, the notice used to be issued by the Commissioner.
In the year 2000, Section 11A of the Central Excise Act was amended to stipulate that SCNs involving duty up to one crore rupees should be issued by the Commissioner or with his prior approval. SCNs involving duty above one crore were to be issued only with the prior approval of the Chief Commissioner.
16 years ago in his Budget Speech of 2000, Finance Minister Yashwant Sinha said, "To curtail the so called" "show cause notice Raj" "in customs and central excise, I have decided that henceforth, show cause notices involving duty amount of more than Rs.1 crore would be issued only with the approval of the Chief Commissioner of Customs and Central Excise. Other show cause notices would require approval of the Commissioner of Customs and Central Excise."
Not a single Draft Show Cause Notice was reported to have been rejected by any Commissioner or Chief Commissioner.
In 2001, this Section was amended to stipulate that SCNs have to be adjudicated within six months/one year - wherever possible. It was rarely possible.
By 2003, these provisions were deleted.
The Board used to review the orders passed by the Commissioners, which effectively meant that the review was done in the Chief Commissioner's office.
In 2005 they brought in the Committee of Commissioners and the Committees of Chief Commissioners. And the entire review process became a big farce. There was one Commissioner holding two charges. He assumed that he constituted the committee and passed a review order. The Committees never functioned and what was put up to one Commissioner/Chief Commissioner was routinely approved by the other without a word between the two. They merrily continue.
The Show Cause Notice Raj which Yashwant Sinha wanted to curtail in 2000 has grown out of proportions into a massive commercial enterprise.