TMI BlogCentral Excise, Customs & Service Tax – Budget proposals for 2002-2003X X X X Extracts X X X X X X X X Extracts X X X X ..... ged to CENVAT only @ 16% (a) Cosmetics and toilet preparations (b) White cement and other cements (c) Travel kits for personal use (d) Yachts and other vessels and floating structures (e) Arms and ammunitions (f) Manufactures of furskin and artificial fur 1.5 With the above changes the rate of 8% is now confined to cotton yarn. The Special Excise Duty of 16% is also confined to a few items, being, Polyester Filament Yarn, Motor Cars, Multi Utility Vehicles, Soft drinks and their concentrates, Tyres for replacement, air-conditioners, pan masala, chewing tobacco and miscellaneous tobacco products. 1.6 An important change relates to textiles. While excise duty on cotton yarn continues at 8%, the exemption applicable to cotton yarn cleared in hank form has been withdrawn w.e.f. 1.3.2002. 1.7 The rate of excise duty on processed fabrics, made-ups and readymade garments has been fixed at 12% which will comprise of 8% CENVAT and 4% AED (in lieu of sales tax) in the case of fabrics. 1.8 Option has been given to manufacturers of grey fabrics, processors of knitted cotton fabrics and manufacturers of knitted garments to pay excise duty at the rate of 12%. The ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es without the facility of CENVAT credit. Manufacturers wishing to avail of CENVAT credit facility would have to pay excise duty at the rate of 16%. The items on which excise duty at 4% has been imposed now are mentioned in notification No.10/2002-CE dated 1.3.2002. 1.14 The rate of excise duty on petrol has been modified. It is now composed of 32% ad-valorem plus surcharge of ₹ 6 per litre. The government has decided to dismantle the Administrative Price Mechanism. The oil companies which are required to pay excise duty would be calculating the revised assessable value for payment of excise duty. It may kindly be ensured that no hold up in the clearances of motor spirit or other petroleum products are caused. For any clarification on the assessable value the oil company may be consulted to provide details. 1.15 The surcharge of ₹ 5.25 per litre will apply for motor spirit which is doped with ethanol. Notification in this regard would be issued in due course of time. 1.16 Rate of excise duty on HSD has been reduced from 20% to 16%. Here also the oil companies would be furnishing the assessable value of HSD. 1.17 The rate of cess applicable to crude petrole ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Video recording/reproducing apparatus, whether or not incorporating a video tuner (85.21) 8 Switches, relays, fuses, surge suppressors, plugs, sockets, lamp holders, junction boxes, etc. for a voltage not exceeding 1000 V (8536.00) 9 Sanitary wares and fixtures (69.08/73.24/7418.90) 1.23 The field officers may kindly advise the assessees manufacturing these items under their charge suitably and the purport of the new assessment, formalities and procedures explained to them. 1.24 There are a few more changes in the nature of exemptions. These are explained in the Explanatory Memorandum that is being sent to you separately. 1.25 The Central Excise Rules and the CENVAT Rules have been re-issued with minor modifications. All notifications issued under the earlier rules would continue to be valid, unless specifically modified or rescinded. 1.26 The Government has taken enabling powers to notify an activity/process as manufacture by notification. This provision will come into force after the Finance Bill receives the assent of the President. 1.27 Another important change is that the Government will now be permitted to explai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om and to any of the North Eastern States. 2.12 Yet another significant feature on the customs changes is that the limit under the Transfer of Residence concession has been increased from ₹ 1.50 lakhs to ₹ 5 lakhs. The limit under mini TR has been increased from ₹ 30,000 to ₹ 75,000. A number of items have also been added which can now be imported at the rate of 30% which is the rate for these items imported under Transfer of Residence. 2.13 The rates of duty applicable to wines and hard liquors has been modified . The basic customs duty on hard liquors has been reduced from 210% to 182%. Basic customs duty on wines continues to be 100%. The rate of CVD has also been modified. There are only two slabs now, one for items upto US $ 25 per case and the other for items above US $ 25 per case. The CVD rate has been fixed at 75% for the first slab and 50% for the second slab. SAD will continue to apply. 2.14 As in the case of excise, Government will now be permitted to issue explanation to an exemption notification to clarify the scope of the notification. This power will also be available to the Government after the Finance Bill receives the assent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are brought into force. 3.5 Information regarding the likely number of assessees from trade associations or directories may be gathered and a report on this aspect may kindly be sent to me within one month. 3.6 The definition of broadcasting service has been modified with retrospective effect so as to put the intention clearly. The assessees who have not paid the service tax on broadcasting services may be apprised of these changes and they may be informed that the dues not paid by them are recoverable. Necessary action in this regard may be taken. 3.7 The definition of banking company has also been modified, taking the definition from the RBI Act. This is only to clarify that the State Bank of India and its subsidiaries are required to pay the service tax without any doubt. 3.8 The Service Tax exemption relating to hotels has been extended upto 31.3.2003. 3.9 Service Tax will now cover number of new assessees. It is important and desirable that the Commissioners apprise the potential assessees of the basic features of Service Tax scheme, its procedure and obligations well in advance. It would be useful if some seminars and meetings with the assessees are conducted i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tral Excise Appendix PRICE DATA Report for the period Commodity Chapter No. Date Description of goods Heading/sub -heading No. Ex-factory price (Rs.) Excise duty paid Wholesale price inclusive of all taxes (Rs.) Retail Price Remarks 28-2-2002 7-3-2002 15-3-2002 22-3-2002 29-3-2002 5-4-2002 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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