Excise Depts Laxity In Settling Disputes To Hit Collections

The excise departments strategy to garner additional revenue through early adjudication of disputes has come a cropper and will affect collections.

The director general of anti-evasion (excise) is believed to have written to CBEC chairman R Gopalanathan to appraise him that most cases with the directorate general, involving excise evasion charges to the tune of Rs 700 crore, are pending adjudication and that this could impact excise collections.

Of the 60,000 pending cases, the department has completed adjudication in only 37,000 cases by the end of 1997.

What is worrying officials more is the quality of adjudicated cases in terms of duty receivable.

 

Officials aver that most adjudicated cases belong to the commissionerates which involve smaller amount of alleged duty evasion. They reiterate that cases involving higher duty evasion charges (in the range of Rs 5 crore and above) were still pending adjudication. These include evasion cases against major corporates like ITC, GTC, Maruti Udyog and several tyre companies and amount to over Rs 700 crore.

In a year of decelerating revenue growth rate, the slow pace of case disposal could lead to a shortfall in collection target. The CBEC chairman had earlier stated that as part of its effort to increase collections, the department would complete adjudication of all pending cases by March.

Earlier, through a notification issued on August 26, the government had appointed three new commissioners under the directorate general (anti-evasion) in Mumbai, Delhi and Chennai to adjudicate cases so as to begin duty recovery by March, 1998. The new commissioners will, however, not adjudicate cases pertaining to cigarettes companies.

Among the cases envisaged to be adjudicated over the next few months include those relating to tyre companies whose alleged cumulative duty evasion is around Rs 100 crore. The companies include Apollo Tyres, Ceat, MRF, Goodyear and Modi Tyre.

Other companies include Maruti which has been show caused in 1990 on charges of duty evasion to the tune of Rs 10.60 crore, Shehnaz Hussains company for Rs 14 crore, Liberty Shoes for Rs 5.3 crore, New Tobacco Company for Rs 36.52 crore and J K Industries for Rs 15.88 crore.