CLEAN ENERGY CESS COMES TRUE

[Mr. M. GOVINDARAJAN]

Implementation:

In the budget 2010-11 the Finance Minister had announced the imposition of Clean Energy Cess as a duty of excise on coal, lignite and peat and it forms part of Finance Act, 2010 in Chapter VII. Notification No.1/2010-CE (Clean Energy Cess) dated 22.6.2010 provides that the appointed date for coming into force of the provisions of Chapter VII with effect from 1^st July, 2010.

Application of provisions of Central Excise Act:

Section 83 of the Finance Act, 2010 provides that the Central Government may by notification in the official gazette declare that any of the provisions of Central Excise Act, 1944 relating to levy, exemption, refund etc., would be applicable in respect of Clean Energy Cess. In pursuance of this power Notification No.2/2010-Clean Energy Cess, dated 22.06.2010 has been issued to borrow the relevant machinery provisions of the Central Excise Act, 1944 which are as follows:

Sec.5A - Power to grant exemption from duty to excise;

Sec. 6 - Registration of certain person;

Sec. 9 - Offences and penalties;

Sec. 9A - Certain offences to be non cognizable;

Sec. 9AA - Offences by companies;

Sec. 9C - Presumption of culpable mental state;

Sec. 9D - Relevance of statements under certain circumstances;

Sec. 9E - Application of Sec. 562 of Code of Criminal Procedure, 1898 and the Prohibition of Offenders Act, 1958;

Sec. 11 - Recovery of sums due to Government;

Sec. 11A - Recovery of duties not levied or not paid or short levied or short paid or erroneously refunded;

Sec. 11AA - Interest on delayed payment of duty;

Sec. 11AB - Interest on delay payment duty;

Sec. 11AC - Penalty for short levy or non levy of duties in certain items;

Sec. 11B - Claim for refund of duty and interest, if any, paid on such duty;

Sec. 11BB - Interest on delayed refunds;

Sec. 11C - Power not to recover duty of excise not levied or short levied as a result of general practice;

Sec. 11D - Duties of excise collected from the buyer to be deposited with the Central Government to be deposited with the Central Government;

Sec.11DD - Interest on the amounts collected in excess of the duty;

Sec. 11DDA - Provisional attachment to protect revenue in certain cases;

Sec. 12A - Price of goods to indicate the amount of duty paid thereon;

Sec. 12B - Presumption that the incidence of duty has been passed on to the buyer;

Sec. 12C - Consumer Welfare Fund;

Sec. 12D - Utilization of the Fund;

Chapter III - Powers and duties of Officers and landholders;

Chapter VI - Adjudication of confiscation and penalties;

Chapter VI A - Appeals;

Chapter VI B - Presumption as to documents.

Rules:

Sec. 84 of the Finance Act, 2010 empowers the Central Government to make rules for carrying out the provisions of Chapter VII. Accordingly, Clean Energy Cess Rules, 2010 have been notified under the provision to prescribe a procedure vide Notification No.6/2010-Clean Energy Cess, dated 22.06.2010.

Registration:

Rule 3 provides that every producer who is liable to pay cess  shall get registered immediately with the jurisdictional Central Excise Officer but not less than a period of thirty days from the date of commencement of these rules by making an application to the jurisdictional Central Excise Officer. Where a producer commences production of the specified goods at any time after the commencement of these rules, such producer shall obtain registration within thirty days from the commencement of such production. Where a producer has a centralized billing or accounting system in respect of such specified goods produced at different times, he may, instead, opt for registering only the premises or office from where such centralized billing or accounting is done.

Payment:

Every producer shall pay the cess leviable on the removal of the specified goods in the manner provided in the Rule 6. The producer shall himself assess the cess payable on the specified goods.

Rule 6 provides that the Cess on the specified goods removed from the mine during a month shall be paid by the 5^th of the second month, following the month in which the removals were made.

A producer who has opted for centralized registration in respect of its mines located at different places shall discharge the cess liability in respect of the aggregate removal of specified goods from all such mines effected during a month by the stipulated period.

Where a producer has paid to the credit of the Central Government any amount in excess of the amount required to be paid towards cess liability for a month, such producer may adjust such excess amount paid by him against the cess liability for the next month. The adjustment of excess paid shall be subject to the condition that such excess amount paid is on account of reasons not involving interpretation of law, taxability, or applicability of any exemption notification. The producer may, instead, file a refund claim for any excess amount of cess paid if such producer fails to adjust the excess amount against the cess liability for the next month.

Any producer fails to pay the cess by the due date, he shall be liable to pay the outstanding amount along with interest at the rate specified by the Central Government under Section 11AB of the Central Excise Act, 1944 on the outstanding amount for the period starting from the first day after the due date till the date of the actual payment of the outstanding amount.

Cess liability shall be deemed to be discharged only if the amount payable is credited to the account of the Central Government by the specified date. Where the registered person deposits cess by cheque, the date of presentation of the cheque in the bank designated by the Board for this purpose shall be deemed to be the date on which the cess has been paid subject to realization of the cheque.

Maintenance of Records:

Every producer shall maintain accounts showing the quantity of specified goods actually removed during a month, particulars to whom these were removed, the amount of cess payable during a month and the total amount of cess paid. Where a producer has opted for centralized registration such producer shall maintain mine wise details. The amount of cess payable of any removals shall be rounded off to the nearest rupee and the actual weight of a consignment shall be rounded off to the nearest tonne.

No specified goods leviable to cess shall be removed from a mine except under cover of a document indicating the quantity of specified goods and the name and address of the consignee.

Cess shall be shown separately by the producer in the bill or invoice raised in respect of the specified goods.

Filing of Returns:

Every producer shall submit to the jurisdictional Central Excise Officer, a return in Form - 1 showing the quantities of specified goods removed during the month in respect of which the payment has been made, the amount paid and other particulars specified in that form enclosing the evidence of payment of cess not later than 10^th day of the month in which the payment has been made. In the case of a producer who has obtained centralized registration the return in Form 1 shall contain mine wise information.

Access to registered premises or mine:

An Officer empowered by the Commissioner in this behalf shall have access to any mine or premises registered under these rules for the purpose of carrying out any scrutiny, verification and checks as may be considered necessary to safeguard the interest of revenue.

Every producer shall furnish to the officer empowered all records prepared and maintained for accounting of transactions in regard to production, storage or removal of specified goods and financial records and statements including cost audit reports etc.,

Penalty:

Whoever contravenes any of the provisions of these rules shall be liable to pay a penalty which may extend to Rs.10,000/- and confiscation of the goods in question in respect of which the contravention is made, if no penalty is provided elsewhere.