9911796707
TMI BlogInstructions regarding Large Taxpayers Unit - reg.X X X X Extracts X X X X X X X X Extracts X X X X ..... 2, Cenvat Credit Rules, 2004, and Service Tax Rules, 1994. The first LTU has been set up at Bangalore, and it has since commenced operation from 3 rd October, 2006. For carrying out legislative changes to give effect to various provisions and facilities with regard to a large tax payer, a new rule 12 BB has been inserted in the Central Excise Rules, 2002, a rule 12 A has been inserted in the Cenvat Credit Rules, 2004, and similarly, rule 10 has been inserted in the Service Tax Rules, 1994. In this way, it has been ensured that the amendments carried out are to the required minimum extent. 2. In this context, the important changes made in the rules and procedures with regard to LTUs are briefly given below: I. Receipt of Consent Form and its Acceptance: On receipt of the consent form from the large taxpayer, the Chief Commissioner, LTU will get the said consent form verified, and if the eligibility conditions prescribed under the rule and the notification have been satisfied, the taxpayer will be informed by way of issue of an acceptance letter. The process of acceptance would not normally take more than 7 days. The large taxpayer will be eligible to avail t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion or where the sender premises is an EOU or a unit located in EHTP or STP. The rules in this regard may be studied carefully. IV. Transfer of credit: Rule 12A(4) of the Cenvat Credit Rules, 2004 provides an option to a large taxpayer to transfer Cenvat credit (of central excise duty or service tax) accumulated in one manufacturing unit or service providing unit to any of its other manufacturing or service providing units. Such transfer can be made by way of issue of a transfer challan containing the details as provided in the said sub-rule. The said transfer challan can be sent by fax or electronically by way of e-mail attaching the scanned copy of the challan to other unit for taking credit which should be followed by the original copy of the challan. However, the utilization of such credit is subject to limitations prescribed under rule 3(7)(b) of the CENVAT credit rules. Moreover, the credit cannot be transferred by units availing area based exemption notifications specified in the said rules. V. Self-adjustment of excess duty paid: Rule 12 BB of the Central Excise Rules, 2002 provides a facility that if a large taxpayer manufacturing excisable goods has paid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s being modified in order to capture certain details in respect of a large taxpayer. The details which are required to the given only by a large taxpayer shall be separately indicated. A suitable notification is being issued. The new format of ER-1 return would be applicable from the month of October, 2006 that is to be filed in November, 2006. X. Audit: Audit frequency norms have been fixed by the department for audit of units. However,a largetaxpayer who is liable to be audited every year would not be ordinarily audited annually. The selection of a taxpayer for audit would be done based on 'risk assessment' taking into account various parameters. As far as possible, the audit of the head office and all the units will be conducted simultaneously. Dates for audit will be fixed in consultation with the large taxpayer. XI. Adjudication : All show cause notices pending adjudication, as on the date of issue of acceptance letter will be transferred to the LTU along with all connected case papers. Cases that are in the process of being adjudicated (i.e. where personal hearings have been conducted) will be decided by the jurisdictional adjudicating authority only. XII. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... For other time-bound matters, where the action is required to be taken in next one month, i.e., the month of November, 2006, the jurisdictional Commissionerate should send a d.o. letter explaining the relevant details of these cases. v) The cases under investigation should be handled by the present Commissionerate only and after issue of SCNs, the case records should be transferred to the LTU. In cases, where records of a particular case is voluminous, the Commissioner, LTU may be consulted in advance as to whether these records are required be kept in the custody of present Commissionerate or to be sent to the LTU 3. The Chief Commissioner, LTU, and Commissioners LTU are expected to play a pro-active role in the administration of the LTU. In fact, the success of LTU depends to a great extent upon their approach in solving the problems at the initial stage. There may be some procedural issues that are likely to crop up while dealing with various activities of a large taxpayer. It is possible that some of the present procedures prescribed under various instructions or circulars cannot be followed in the case of a large taxpayer. In such cases, the Chief Commissioner is em ..... X X X X Extracts X X X X X X X X Extracts X X X X
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