CIR NO.691/07/2003-CX, DT. 11/02/2003

Removal of Budget Day restrictions for Budget 2003-04

Notification 6/2003 –CE (NT) dated 11th February, 2003 (copy enclosed herewith) has been issued to delete rule 32 of Central Excise Rules, 2002 relating to restrictions on removal of goods between the time appointed for the presentation of the Annual Budget (or any Supplementary Budget) and 12 midnight on the same day. Thus, there is now no provision to impose Budget restrictions.

2. Historically, Budget Day restrictions were aimed at preventing duty evasion as the duty was required to be paid before the removal of the excisable goods and the duty rates were normally enhanced. However as per the present provisions, the duty is required to be paid on installments basis and is paid on fortnightly and monthly basis by non-SSI and SSI units respectively. Therefore it is the view that even if there is any enhancement in the duty rates or a new levy is imposed in the Budget, the duty liability is not required to be discharged on consignment basis but only at the end of a fortnight or month as the case may be. Moreover, it is also felt that Budget Day restrictions adversely impact economic activity, cause loss of output and disruption in day to day activities of the assesses. Therefore, it has been decided to do away with Budget Day restrictions with immediate effect and this decision has been implemented vide issue of said notification dated 11th February, 2003. To reiterate, there shall be no Budget Day restrictions this year. The net effect shall be that as on any other day, on the Budget Day i.e. 28th February, 2003 also, the assessees shall be free to carry out their activities without seeking special permission from the Department. At the same time it is expected that normal anti-evasion activities by the field formations would ensure against misuse of the relaxation now being introduced.

3. Trade and field formations may be informed accordingly.

Sd/-
(Vijay Mohan Jain)
Under Secretary to the Govt. of India

F.No. 201/04/2003-CX-6

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