The Hindu : Business : Put Cenvat claims under scanner, DoE told

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Friday, Sep 01, 2006

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Put Cenvat claims under scanner, DoE told

Special Correspondent

The claims soared by over 26 per cent in April-July

— Photo: V. Sudershan

CLOSE SCRUTINY: Union Finance Minister, P. Chidambaram (centre), with Revenue Secretary, K. M. Chandrasekhar (left), and Minister of State for Finance, S. S. Palanimanickam, at a conference in New Delhi on Thursday.

NEW DELHI: The Union Finance Minister, P. Chidambaram, on Thursday directed the Department of Excise to put Cenvat claims by companies under the scanner to ensure that the facility is not misused.

Speaking to newspersons after chairing the `All India Conference of Chief Commissioners of Customs, Excise and Service Tax' here, Mr. Chidambaram said: "We have asked the Excise Department to look at Cenvat availment very closely. We must make sure that Cenvat availment is not taken more than what is entitled."

With Cenvat claims soaring by over 26 per cent during the first four months of 2006-07, Mr. Chidambaram noted that the matter needed a look-in although the four per cent countervailing duty imposed this fiscal on imports could be a possible reason for the high level of claims submitted by companies.

In the event, Cenvat claims are set to come under the Department's lens, especially when the prime reason for the shortfall in excise duty collections last fiscal was higher-than-targeted Cenvat availment by companies.

The collection of all indirect taxes — customs, excise and service tax — during the first four months of this fiscal, however, are higher than targeted. Mr. Chidambaram also disclosed that the Department, which was facing a shortage of manpower, had obtained permission for an ad hoc appointment of 1,400 people. On an average, about 17 personnel are required for each SEZ (special economic zone), he said.

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