“Once we are allowed deemed credit on scrap, excise revenue of the Centre will increase and malpractice prevalent in trade will also be curbed,” All India Induction Furnaces Association president, KK Garg said
Chandigarh: Secondary steel producers have sought from the Centre—deemed credit—facility on scrap sourced locally from non-excisable units, saying it will curb “large scale duty evasion” and boost government revenue, reports PTI.
“We have urged the Centre to allow induction furnace owners to claim deemed credit on scrap bought domestically from units which do not fall under the purview of central excise,” All India Induction Furnaces Association (AIIFA) president, KK Garg told PTI here.
“If deemed credit facility is allowed, it will plug the leakage of revenue and ensure prevention of malpractice, prevalent in the trade and industry,” he said.
AIIFA has written to finance minister Pranab Mukherjee for restarting the deemed credit facility for the secondary steel makers.
Mr Garg said that as per rule 13 of Cenvat Credit Rules 2004, the Centre has the power to notify goods for deemed credit. Earlier, till 1987, deemed credit facility was available on iron and steel products.
However, this facility was suspended after Centre received complaints regarding its misuse.
Various industries, outside the purview of central excise, like bicycle, sewing machines, SSI engineering and units, located in tax free zones, produce scrap out of steel on which excise duty is already paid.
Indigenous steel-melting scrap sourced from non-excisable units constitutes 40% of total input requirement for country’s induction furnace owners.
“The problem arises as scrap sellers could not produce excise documents while selling to us. As a result of which induction melting furnace units are not able to get any duty credit on steel products made out of this type of scarp,” he said.
As the industry procures scrap without proper bills, it sells steel ingots made out of this scrap while adopting ‘illegal means’, including not paying excise duty on these goods by hoodwinking central excise authorities, according to industry experts.
“Once we are allowed deemed credit on scrap, excise revenue of the Centre will increase and malpractice prevalent in trade will also be curbed,” he said.
The industry suggested that deemed credit be capped in order to prevent its misuse.
There are about 950 induction furnace owners in the country catering to wide range of industry verticals for iron and steel requirements.
The Revenue Department is trying to locate 9 lakh business entities that have stopped filing service tax returns, with a view to improving collections and to ascertain whether there is any tax evasion
To locate 9 lakh entities that have stopped filing service tax returns, the Revenue Department has decided to cross check the present mandatory e-filings with past records.
The exercise is likely to start after 26th December, the last date for e-filing. "Earlier the returns were filed manually. But as e-filing has been made mandatory, we could now easily reconcile the filings with our records to find out who have stopped filing the returns," a Revenue Department official said. The official said the date of e-filing for half yearly return has been extended as trade could get enough time to adjust to the requirement of e-filing. The Revenue Department is trying to locate 9 lakh business entities that have stopped filing service tax returns, with a view to improving collections and to ascertain whether there is any tax evasion. The Department is faced with a task of collecting nearly Rs 90,000 crore service tax this fiscal.
The Budget target for service tax collection was Rs82,000 crore for the fiscal, but now it has been increased by 10%. There are 15 lakh registered service tax payers in the country. However, only six lakh service tax payers are filing returns.
When asked why the 9 lakh payers are not filing returns, the official said there could be several reasons. "Obviously one reason could be to evade taxes.
Besides, now there is an exemption from filing returns for entities with turnover of less than Rs10 lakh and also many businesses would have closed down," he said.
The tax, at a rate of 10%, is imposed on about 120 services, like banking, hotel and telephony. However, with the implementation of Goods and Services Tax (GST) the scope of service tax would be widened. Service tax realisation in the fist six months of the fiscal has increased by 35.6% to Rs36,459 crore.
According to the RBI data, the number of cheques cleared by banks in August 2011 also went down by 5% over the same month last year
The total value of transactions carried out through cheques across the country in August 2011 amounted to Rs7.43 lakh crore, down by 8.3% over the same month last year. Banks had cleared cheques worth Rs8.11 lakh crore in August 2010.
According to the Reserve Bank of India (RBI) data, the number of cheques cleared by banks in August 2011 also went down by 5% over the same month last year. A total of 11.16 crore cheques were cleared by banks during the month under review, compared to over 11.75 crore in the year-ago month.
During the April-August period, the total value of the transactions carried out using cheques stood at Rs41.23 lakh crore, against Rs41.39 lakh crore in the same period a year ago, a dip of 0.3%. A total of 55.5 crore cheques were cleared by banks during the first five months of the current fiscal, a decline of almost 3.5% from 57.53 crore in the April-August period a year-ago.
In August, the Mumbai region reported the highest number of cheque clearances as well as the maximum transaction value for any zone. Banks in the Mumbai region cleared two crore cheques, with total value of over Rs1.25 lakh crore.
Cheque transactions have been on the decline over the past few years with the growth of electronic transfer medium.