Official Amendments to the Finance Bill, 2002 - Central Excise - Letter F. No. B-10/1/2002-TRU

Letter F. No. B-10/1/2002-TRU Dated 14-5-2002 Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi Subject : Official Amendments to the Finance Bill, 2002 I am directed to inform you that certain Official Amendments have been carried out in the Finance Bill, 2001. The details of these amendments are given in the Annexure. The Finance Bill, 2002 with these amendments has been enacted on 13-5-2002. These amendments will accordingly be reflected in the Finance Act, 2002, a copy of which will be sent to you in due course of time. 2. The Board desires that the above amendments may kindly be taken note of and the field formations may be suitably informed. Annexure Amendments made in the Finance Bill, 2002 S. No. Reference of Finance Bill Prior to amendment Subsequent amendment Remarks 1. New Clause inserted after Clause 120 Section 75 contained a reference of the Foreign Exchange Regulation Act, 1973 (46 of 1973). Section 75 has been amended to substitute the reference to Foreign Exchange Regulation Act, 1973 (46 of 1973) by Foreign Exchange Management Act, 1999 (42 of 1999) It is a technical change. This amendment incorporates the reference to Foreign Exchange Management Act, 1999 in section 75 of the Customs Act. 2. New Clause inserted after Clause 120; Provisions relating to Special Economic Zone There were no separate provisions in the Customs Act, 1962 relating to Special Economic Zone. Chapter XA has been inserted in the Customs Act, 1962 regarding Special Provisions relating to Special Economic Zone. This will come into effect from a date to be notified by the Central Government for this purpose. Detailed instructions in this regard will be issued by the Customs section of the Board. 3. Clause 127; Provisions relating to Special Economic Zone — This amendment in section 3 of the Central Excise Act, 1944, relates to the Special Economic Zone. Detailed instructions in this regard will be issued by the Customs section of the Board. 4. Clause 128 — This amendment in section 5A of the Central Excise Act, 1944, relates to the Special Economic Zone. Detailed instructions in this regard will be issued by the Customs section of the Board. 5. New Clause inserted after Clause 136 Central Excise Rules provided for payment of Central Excise duty on fortnightly basis under Rule 8 and filing of monthly returns under Rule 12. Following amendments have been made retrospectively w.e.f. 1-3-2002 in the Central Excise Rules, 2002, namely; (i) new sub-Rule (1A) inserted in Rule 8; (ii) new rule 8A has been inserted to prescribe manner of payment of duty in respect of (a) specified goods on which excise duty has been imposed with effect from 1-3-2002 (b) granite (c) woven fabrics of cotton (d) woven fabrics of man made fibres; (iii) new rule 12A has been inserted to prescribe manner of filing of return in respect of goods mentioned in (ii) above. This amendment validates the deferment of fortnightly payment of central excise duties payable by 5-3-2002 and 20-3-2002 by non-SSI assessees and the duties payable by 15-3-2002 by SSI units located in the State of Gujarat. Assessees located in Gujarat were allowed to defer the payment of these installments till the 31st March, 2002, in view of the disturbances. Further this amendment validates the deferment of payment of the central excise duties till 15th of June, 2002 by the granite units, the new assessees who would be coming under the tax net for the first time (goods on which excise duty was imposed at a nominal rate of 4% adv. ), and hand processing units who are required to pay duty on undertaking specified finishing processes such as stentering, curing or heat setting, cropping, expanding etc., for the clearances made during the period from March, 2002 to May, 2002. This amendment also validates the filing of periodic returns in respect of these units by the 10 June, 2002. 6. Clause 142, sub-clause (a), section 65 (90)(zs); Definition of "taxable service" in relation to cable services "taxable service" means any service provided to a subscriber, by a cable operator in relation to cable service. "taxable service" means any service provided to a customer , by a cable operator in relation to cable service. This amendment makes a technical correction in the definition of taxable service rendered by cable operator, as the definition of subscriber does not cover a cable television subscriber. 7. New clause inserted after clause 151 The notification of the Government of India in the Ministry of Petroleum and Natural Gas No. S.O. 417(E), dated the 12th April, 2002 issued under sub-section (4) of section 15 of the Oil Industry (Development) Act read with section 5A of the Central Excise Act, prescribes the effective rate of cess @ Rs. 900 PMT on crude oil for fields covered by production sharing contracts (PSC's). This notification, has been given retrospective effect from 1-3-2002 and necessary validation provisions have been made in the new clause. This amendment gives retrospective effect from 1-3-2002, to the notification of the Ministry of Petroleum Natural Gas, dated 12-4-2002, vide which the effective rate of cess on crude oil for fields covered by production sharing contracts (PSC's) has been prescribed @ Rs. 900 PMT. 8. Amendment in the Schedule II The tariff rate of basic customs duty on dairy spreads as well as other fats and oils derived from milk, falling under sub-headings 0405.20 and 0405.90 was prescribed at 30%. The tariff rate of basic customs duty on goods falling under sub-headings 0405.20 and 0405.90 has been increased to 40%. This amendment raises tariff rate of basic customs duty on goods, namely dairy spreads as well as other fats and oils derived from milk, falling under heading 04.05 to the WTO bound rate of 40% ad valorem .