Cir. No. 34/34/94-CX

Subject : Certain Clarifications on invoice- based assessment Procedure-Regarding.

I am directed to state that after the introduction of invoice-based assessment procedure, a number of representations have been received from various quarters on the implementation of the new procedure. These representations have been examined and the following instructions for guidance.

Point No. 1: It has been represented that Rule 52A(7) provides for the intimation of the serial number of invoice, before being brought into use, to the Assistant Collector of Central Excise. This will create difficulties where Assistant Collector's office is situated at a considerable distance

Decision: Similar provisions exist in other Rule but it is not understood why difficulty has cropped up now. At any rate intimation of the serial numbers to be used in subsequent month or quarter etc. could be sent by post or in person, as convenient to assessee.

Point No. 2 : It has been pointed out that pre-authentication of computerized invoices is not possible as computer invoices are printed on a blank continuous stationary. It has also been stated that computerized invoices have no pre-printed serial number and the serial number is generated only while printing the invoices and accordingly invoice numbers cannot be pre-printed before use.

Decision : Serial number can be printed at the time of printing the invoice. However, authentication can be done after printing but before the invoice is assigned the date and time of removal.

Point No. 3: It has been represented that for exports the format of invoice has been standardised by the commerce Ministry. It cannot be modified to also incorporate the details required by the excise department.

Decision : Annexure A of instruction No. 29/29/94-CX, dated 12/03/1994 would not be applicable to export consignments. Information furnished in AR4/AR4A (now both merged into AR4) would suffice. Further, AR4/AR4A should indicate the date and time of removal of goods and should also accompany the goods along with the assessee's invoice.

Point No.4 : SAIL has represented that in the case of integrated steel plants dispatches takes place from several points which at times are situated several kilometers from the place where invoice is prepared. As such invoices are not prepared simultaneously with clearance but subsequent to clearance. It has been requested that its Dispatch Advices (which do not indicate the value) issued by dispatch points of the plant may be accepted as adequate documents for clearance of goods from the factory.

Decision : It is mandatory under the rules to show the value in the invoice when the assessment depends on value of the goods. There can be no relaxation on this score. Necessary modifications to the existing procedure for issue of invoices may be effected. However a time of three months to use the existing system may be allowed. In the meantime assessee should make necessary modification to extend terminals from the computer system to the dispatch points.

Point No.5 : It has been represented that in the case of consignment that is split up into a number of lots, each of which is transported separately (Rule 52A(4) refers) it is not possible to have a separate invoice for each lot.

Decision: As invoice now serves as a transport document also, consolidated invoices will not be acceptable and in case of split consignments every lot will have to be accompanied with a separate invoice. In such case, the assessment has to be provisional.

Point No.6 : Instead of signing all four copies of computerised invoice only first copy may be signed as other 3 copies being pre-carbonized will get the impression of the signature made on the first copy.

Decision: Suggestion of the Industry can be accepted. Any assessee providing any distinctive mark on such stationery paper, so as to identify the origin of invoice to the assessee, may also do so and intimate the Department of such distinctive marks.

Point No.7 : Prior intimation of serial number of computerised invoices to Assistant Collector is not possible as serial number of invoice is printed by the computer only when the invoice itself is being printed.

Decision: This should not present any problem. Considering the volume of work normally handled by the assessee, it should be possible to intimate in advance to the excise department the serial numbers of the invoice they are likely to use, within a specified period, say, quarter, half-year or one year. In case the serial numbers get exhausted prior to that period, a revised intimation could be sent.

Point No. 8 : In case of computer stationery, there cannot be any bound book of invoices with the serial number of the invoice printed in advance. Computerised invoices are printed on a continuous running stationery. Hence, it is suggested that instead of stipulating bound invoice books, it may be provided that the loose foils of all the invoices issued in a month will be bound at the end of the month.

Decision: So long as the computer stationery bears identification or distinctive mark so as to connect the same to the assessee issuing invoice on such stationery, there is compliance to the provisions of Central Excise rules and hence acceptable.

Point No.9 : Rule 52(A) (6) requires that the serial number of invoices should start from 1st January every year. It has been suggested that this should be changed to 1st April every year in order to align the numbering of invoices with the accounting year and the assessment year under the income-tax.

Decision: For the current year the numbering is beginning from 1st April, 1994 and there is no immediate problem. (To take a decision for the long run, Collectors are requested to ascertain the practice in the field and report to the Board).

Point No. 10: 2nd proviso to Rule 173C states that ‘where an assessee removes goods of the same kind and quality from his factories located in the jurisdiction of different Collectors of Central Excise or Assistant Collectors of Central Excise, he shall file, with the proper officer a declaration’............. The representation states that it is not clear who will file the declaration.

Decision :- The declaration will be filed by each factory to its jurisdictional excise officer. The Assistant Collector in charge of the factory nearest to the registered head office will coordinate and finalise the assessable value and intimate the same to all other Assistant Collectors having jurisdiction over other factories of the assessee.

Point No.11 : In the case of transfer from one factory factory to another factory of the same company, movement to job worker, captive consumption, there is no sale transaction and the goods move on a Dispatch Advice (DA) / Challan. It is apprehended in the filed that Modvat on the basis of the DA may be denied to the recipient factory on the grounds that such documents are not mentioned as a prescribed document in Rule 57G and the notification issued under Rule 57G. [Notification No. 15/94-CE (NT), dated 30/03/1994].

Decision : It has been decided that in such cases after such transfer, the assessee should issue his own invoice which is recognized for Modvat purposes (Notification No. 15/94-CE (NT), under Rule 57G). Such invoice should adequately explain the difference if any for depot price and the factory’s gate pass and comply with other details as in Annexure of the Circular of even number, dated 21/03/1994.

Point No. 12 : Rule 173C should provide an enabling provision for provisional assessment as in the erstwhile Rule 173(C)(6).

Decision : There is no need to do this as Rule 9B takes care of this.

Point No. 13 : Annexure A of the instruction 29/29/94-CX should have a column on class of buyers and particulars of contract if any.

Decision : This is not acceptable.

Point No. 14 : It has been reported that for specific rated excisable goods, field officers are demanding information relating to assessable value etc., as contained under certain columns of Annexure ‘A’ to the instructions, dated 21/03/1994. It is clarified that for specific rated goods information regarding assessable values, not being relevant, need not be insisted upon.