Visits by Central Excise Officers to the premises of Service Tax Assessees - Service Tax - Trade Notice No. 103/99 - Madurai

The following instructions/clarifications are issued with regard to the visits by the Central Excise Officers to the premises of the Service Tax Assessees. The Service Tax being a comparatively new levy and public awareness and acceptance of the levy being very low, in order to increase compliance with the law, department has from the beginning stressed upon collection of tax on mutual faith. Accordingly, many irritants such as routine visits to the assessees premises and calling for documents have not been encouraged. The Central Board of Excise and Customs had earlier desired that no visits should be made by the Central Excise Officers to the premises of the assessees for carrying out any routine check. The Board also desired that the visits for the purpose of rectification of mistake under Section 74 of Chapter V of the Finance Act, 1994 may be conducted only with the prior approval of the Commissioner of Central Excise. In spite of such clear instructions certain instances of visits by Central Excise officers to the premises of the service tax assessees for the routine purposes and without giving any prior notice have been brought to the notice of the Department by the Trade. With a view to ensure that such complaints from the Trade are not received, it is hereby advised that any visit to the premises of the Service Tax assessee may be made only after giving the concerned assessee a notice in writing explaining therein the purpose of such visits. The officer should also clearly indicate the documents which may be required by them during their visits. No visits should be made without giving a clear notice of 15 days to the assessee and all such visits shall be only with the prior approval of the Commissioner. The above guidelines would not apply in the case where the department has received any specific information/intelligence regarding evasion of Service Tax or contravention of law by any assessee. In such cases the due process of law may be followed and action may be taken depending upon the exigency of the situation.