Excise Officers Want Pressure Cookers Out Of Ssi List

Once bitten, twice not shy. That seems to be an apt description for a recent case of excise evasion detected by the Delhi collectorate.

Just four days after being caught by excise officials for tax evasion, the manufacturers of Presco, Paradise and JK brand of pressure cookers, Hitesh and Joginder Malhotra, were back to issuing fake excise and sales tax numbers on receipts for their products to evade duty.

Unfortunately for them, excise officials had continued to keep a close watch on their G T Karnal Road unit. The duo were promptly caught red-handed again.

The case of the Malhotra brothers is just one instance of the irregularities that are rife in pressure cooker manufacturing units. According to officials, manufacturers resort mainly to three kinds of malpractices. To begin with, they prepare different invoices for office records, sellers and transporters. They also resort to underinvoicing of office records. Further, they prepare invoices with fake excise and sales tax registration numbers

 

According to excise commissioner R K Chakravarti, nearly 200 cases of excise duty evasion have been detected in the past few months.

Revenue officials are now requesting the government to remove pressure cookers from the list of items that can be manufactured by the small-scale industries (SSI) sector. SSI notification applies to select commodities and pressure cookers should be taken out of the list of items that can be manufactured in the small scale sector, said an official.

The clearance from most of the units is more than Rs 30 lakh, which makes it mandatory for them to pay duty. However, they are not willing to pay duty of just five per cent on an annual clearance upto Rs 75 lakh, the official added and said that it was necessary to remove pressure cookers from SSI notification to check loss of revenue for the government.

Recent raids at G T Karnal Road on units apart from the Malhotras also unearthed several malpractices. But even after the raids, one of the units Indian Metal Industries, has not got itself registered with the revenue department despite manufacturing a pressure cooker branded Maruti.

Revenue officials said the results of the recent raids were typical of the problems that excise officials are faced with. SSI manufacturers do not want to register themselves with the excise department and do not declare their actual production. After their premises are raided by the excise department, they resume production at another address, making it very difficult to keep track of them.

Delhi is currently the third-largest manufacturer of pressure cookers in the country. The SSI units cater to a thriving wholesale market at Sadar Bazar, making the pressure cooker business an extremely lucrative one. Officials believe that pressure cooker manufacturers are taking undue advantage of this. Besides, an added incentive for manufacturers is that theft of electricity is not difficult. Even with the Supreme Court breathing down the neck of some of these units, they do not want to shift since all these irregularities could easily be detected in an industrial area, pointed out the officials.

Officials called for stricter enforcement measures on the lines of the recent changes announced in the search and seizure norms for the Income-Tax department. Since we have relaxed regulations for them, the anti-evasion laws should be strengthened to prevent revenue loss to the government, said an official.