Large Scale Notifications for Small Scale Industries

By Vijay Kumar

A concerned senior citizen, in a mail to me, wonders why the exemption notifications for SSI units have to be so confusing and complicated. He laments that everyone seems to be oblivious to the fact that vast majority of SSIs and tiny industries who avail these are run by individual entrepreneurs or petty partnerships who are either semi-literate or illiterate. Hence the notifications need to be simplified and put in clear terms. He wonders if the Honourable Members of Parliament who are party to these notifications can comprehend them correctly. He cites the Notification No.9/2003-CE

''In exercise of the powers conferred by sub-section (1) of Section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts clearances, specified in column (2) of the Table below (hereinafter referred to as the said Table), for home consumption, of excisable goods of the description specified in the Annexure appended to this notification (hereinafter referred to as the specified goods), from so much of each of the duties of excise specified thereon in the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) (emphasis supplied) or the Second Schedule to the said Central Excise Tariff Act, as the case may be, as in excess of the amount (emphasis supplied)calculated at the rate specified in the corresponding entry in column (3) of the said Table: ……”

Should the SSI units go to a consultant to understand the meaning of this notification? He suggests a simple language like

Clearances up to first Rs. 100 Lakhs in the year shall be invoiced at 60% of Standard Duty and the same paid to the Govt.

Above Rs. 100 lakhs the clearances shall be invoiced at Standard duty and paid.

As simple as that? Or is it?. He says that the Govt. should not mislead the SSIs stating it is a concession to them while it is actually a concession to the end purchasers if Section 11D is to operate concurrently. The SSIs can not be expected to know all the intricacies and may be trapped into litigations under Sec 11D.As the Govt. making these laws is Omniscient it is their duty to make these aspects clear in the notifications.

And imagine the plight of an SSI if the Government in exercise of its powers goes for retrospective legislation!