APPENDIX - 43
Procedure to be followed for reimbursement of Central Sales Tax (CST) on supplies made to Export Oriented Units (EOUs) and units in Export Processing Zones(EPZ), Electronic Hardware Technology Park (EHTP), Software Technology Park (STP) and Special Economic Zones(SEZ)from Domestic Tariff Area (DTA)
Note: Please see
paragraph 9.29 and
9A.17 of this Handbook.
The procedure given hereunder shall be applicable for reimbursement of Central Sales Tax.
2. The Export Oriented Units (EOUs) and units in Export Processing Zones (EPZs), Electronic Hardware Technology Park (EHTP), Software Technology Park (STP) and Special Economic Zones (SEZ) will be entitled to full reimbursement of Central Sales Tax (CST) paid by them on purchases made from the Domestic Tariff Area (DTA), for production of goods and services as per Exim Policy on the following terms and conditions:
(a) The supplies from DTA to EOU/EPZ/EHTP/STP/SEZ units must be utilised by them for production of goods meant for export and/or utilised for export production and may include raw material, components, consumables, packing materials, capital goods, spares, material handling equipment etc. on which CST has been actually paid by the EOU/EPZ/EHTP/STP/SEZ
(ii) While dealing with the application for reimbursement of CST, the Development Commissioner or the designated officer of EHTP/STP shall see, inter alia, that the purchases are essential for the production of goods meant for export and/or to be utilised for export production by the units.
3. The procedure to be followed in this regard is indicated hereinafter and shall be strictly adhered to:
Procedure:
(i) The unit shall present its claim for reimbursement of CST in the prescribed form (Annexure - I) to the Development Commissioner of the EPZ/SEZ concerned or the designated officer of the EHTP/STP.
(ii) As soon as the goods are received by the EOU/EPZ/EHTP/STP/SEZ unit in its premises it will be entered in the material receipt register kept for the purpose. The register must show the details of goods, quantity, the source of purchase and the C Form against which purchase is made, etc. which will be subject to periodical check by the authorised staff of the Zone/Customs administration. A Chartered Accountant’s certificate regarding the verification of the materials receipt register relevant to the claim as at Annexure - II shall be submitted alongwith the claim,.
(iii) The reimbursement of CST shall be admissible only to those units who get themselves registered with the Sales Tax authorities in terms of Section 7 of the CST Act, 1956 read with (Registration and Turnover) Rules, 1957 and furnish a photostat copy of the Registration Certificate issued by the Sales Tax authorities to the Zone office concerned for keeping it in the relevant file.
iv) Claims shall be admissible only if payments are made through the bank accounts maintained by EOU/EPZ/SEZ/EHTP/STP unit or DD emanated from its accounts.
(v) The claim shall be submitted alongwith the following documents:
a) Chartered Accountant’s Certificate, from CA, meeting the following criteria, certifying receipt of the goods as shown in Annexure-II in the bonded premises, scrutiny of original invoice/bill of the supplier and proof of payment against each invoice/bill and its reconciliation with ‘C’ Form:-
Eligibility criteria for C.A. firms:
(i)In case of units located in the the States of J&K, Orissa, North-Eastern States, Andaman and Nicobar islands and Lakshadweep, the Chartered Accountant firm should be at least a Sole Proprietorship firm who should be an FCA and engaged full time with the firm.
(ii)In case of partnership Chartered Accountant firms located in the regions indicated in (i) above, should have at least two full time partners, one of whom should be an FCA.
(iii)In case of units located in other regions, the partnership Chartered Accountant firms should have atleast one full time partner, who should be an FCA.
(iv)For the regions indicated in (i) above, the Chartered Accountant firm be located in the area where the unit is situated otherwise qualification of (iii) shall apply.
b) Photostat copy of C Form issued by the EOU/EPZ/EHTP/STP/SEZ to the supplier in the DTA with reference to the counterfoil produced by the unit. The counterfoil of C form will be returned to the unit after making suitable endorsement like ‘cancelled/CST reimbursed’ duly signed by the authorised officer of the Zone administration. While making the endorsement only, the items for which CST has been reimbursed should be indicated as cancelled. and the photostat copy will be retained by the officer for keeping in respective file. In the event of the same `C’ form being used again, the verification could be done at the time of scrutiny from the self attested photocopies. The firm must indicate the file No. on which the original stands submitted.
(vi) The reimbursement will be limited to the payment of CST against C Form only.
(vii) The EOU/EPZ/EHTP/STP/SEZ shall also intimate the name of the person/persons who are authorised by them to sign the C Form and furnish three copies of his/their specimen signature(s) which will be kept in the relevant file of the unit.
(viii)The reimbursement will be made on quarterly basis. No claim for reimbursement will be normally entertained if not claimed within a period of six months from the completion of the quarter in which the claim has arisen. In case of procurement of goods against payment in instalments, the CST reimbursement claim may be made in the quarter in which the full payment has been effected against the invoice/bill. In exceptional cases, the Development Commissioner may consider delayed applications after satisfying that the delay was due to genuine grounds.
(ix) Only one consolidated claim for a quarter will be admitted for reimbursement of CST. No supplementary claim shall be entertained.
(x) The claim for CST reimbursement for the amount below Rs. 100/- on any single invoice shall not be entertained.
(xi) The disbursing authority for the claim of reimbursement of CST will be Development Commissioner/designated officer of EHTP/STP who will make payment to the units. All claims shall be subjected to post audit.
(xii) The unit shall preserve for three years all the original documents viz. Original invoice/bill, money receipt/bank statement for random/sample checking and produce the same as and when called for by the office of the Development Commissioner. Random checking of 5% of the claims of a particular quarter should be done in the next quarter through generation of computer statements on the basis of serial numbers. The random list will be generated by the Development Commissioner personally.
(xiii) In case some glaring error or irregularity is detected against any unit in claiming CST reimbursement, action to recover the amount paid and levy penalty would be taken under FTDR Act against such unit.
(xiv) Any dues of the Government viz. arrear of Lease rent, amount on account of a Courts decree or Income tax recovery note, etc. will also be deductible from the claim amount or it can be set off from the subsequent payment.
(This Appendix has been substituted vide
PN. No. 34(RE-01), Dt. 31/8/2001.)