CIR NO. 946/07/2011-CX, DT. 01/06/2011

Writing off of arrears of Central Excise duty and Customs duty - Constitution of Committees to advise the authority for writing off of arrears-reg.

I am directed to invite reference to the instructions contained in Board"s Circulars F.No. 290/4/85-CX.9 dated 22.3.85 and F.No. 290/20/90-CX.9 dated 21.9.1990, on the subject of write off of arrears of irrecoverable dues.

2. In the context of revision of the delegated powers to write off irrecoverable tax arrears, most of the Chief Commissioners did not recommend any enhancement of the existing monetary limits prescribed vide Board"s Circular dated 21.9.1990. On the other hand, the Chief Commissioners suggested adoption of a Committee system for deciding cases of write off of arrears as followed by the CBDT. It is seen that CBDT, while revising the delegated powers to write off arrears, has prescribed constitution of Committees at different levels for taking a decision to write off arrears in deserving cases.

3. It has, therefore, been decided by the Board to constitute three - member Committees of Chief Commissioners and Commissioners, which will examine the proposals for write - off of irrecoverable arrears and recommend deserving cases to the authority competent to order such write - off in terms of the Board"s Circular dated 21.9.1990. While the Committee of Chief Commissioners shall be constituted by the Board, as and when necessary, on the basis of the request of the Zonal Chief Commissioner, the Committee of the Commissioners shall be constituted by the Zonal Chief Commissioner, as and when necessary, on the basis of request of the jurisdictional Commissioner. The Chief Commissioner (TAR) shall be an ex-officio Member of each Committee of Chief Commissioners to ensure uniformity in approach and decision making by such Committees. Similarly, one of the Commissioners (TAR) to be nominated by the Chief Commissioner (TAR), shall be a Member of each Committee of Commissioners. Whenever a proposal for write - off of irrecoverable arrears is submitted by the Deputy/Assistant Commissioner in the prescribed format (Annexure A), the Zonal Chief Commissioner or the jurisdictional Commissioner, depending on the amount of duty/tax proposed to be written off, shall examine the proposal and if prima - facie satisfied, request the Board or the Zonal Chief Commissioner, as the case may be, for constitution of an appropriate Committee. The Committee so constituted shall examine the proposals and on the basis of the recommendation of the Committee, the competent authority shall write - off arrears in deserving cases, in accordance with the powers delegated for the purpose.

4. The constitution of the Committees and the powers to write off, delegated to the competent authorities are as under:-

Sl. No.	Competent Authority	Constitution of the Committee	Powers delegated
1.	Chief Commissioner of Customs & Central Excise/ Central Excise/ Customs	Committee of two Chief Commissioners of Customs & Central Excise/ Central Excise/ Customs and the Chief Commissioner (TAR)	(a) Full powers for abandonment of irrecoverable amounts of fines and penalties imposed under Customs Act, 1962, and Central Excise Act, 1944. (b) To write off irrecoverable amounts of Customs/Central Excise duties upto Rs. 15 lakh subject to a report to the Board.
2.	Commissioner of Customs & Central Excise / Commissioner of Customs / Commissioner of Central Excise	Committee of two Commissioners of Customs & Central Excise/ Central Excise/ Customs and one Commissioner (TAR) nominated by CC(TAR))	(a) Full powers for abandonment of irrecoverable amounts of fines and penalties imposed under Customs Act, 1962, and Central Excise Act, 1944. (b) To write off irrecoverable amounts of Customs/Central Excise duties upto Rs. 10 lakh subject to a report to the Chief Commissioner.

5. As regards write off of interest amount, it is clarified that once duty involved is written off, the interest due thereon would get automatically written off. It is also clarified that the duty/ tax involved in the case would determine the level of authority/Committee competent to write off the amount involved.

6. As for writing off of arrears of service Tax, action is being initiated for suitable amendment of DFPR before proceeding with the writing off.

7. The field formations are, therefore, directed to take action on the above lines. If any difficulty is faced, the same should be brought to the notice of the Board.

Yours faithfully,
(Surendra Singh)
Under Secretary to the Govt. of India

F. No. 296/10/2009-CX-9

Click here for Annexure - A

ANNEXURE-A

PROFORMA FOR SENDING PROPOSALS FOR WRITE-OFF OF IRRECOVERABLE ARREARS OF REVENUE

RANGE:

DIVISION:

COMMISSINE

1.	Name of the Defaulter:
2	Address:
3	Registration No.:
4	Name of the commodity and CETH/ Service:
5	Brief facts of the case (if necessary, separate sheet may be attached):
6	Date of issue of Show Cause Notice and of Adjudication of the case with copy of Adjudication Order:
7	Details of efforts made :
	(A) for realizing amounts from any money owed to the defaulter
	(B) for attachment and sale of excisable goods belonging to the defaulter
	(C) for attachment and sale of goods belonging to the defaulter, under the control of Customs
	(D) to detain the goods under the provision of Section 142 (1) (C) made applicable to Central Excise
	(E) to sell the detained goods
	(F) to attach the goods in the possession of custody of the transferee/successor under Section 11 of Central Excise Act, 1944.
	(G) to ascertain the location of any movable/immovable assets belonging to the defaulter through (i) enquiry with other Government Deptts. (ii) enquiry with Bankers of the defaulter
8.	Amount to be written off:
	Total amount due:	Rs.
	Duty	Rs.
	Penalty	Rs.
	Fine	Rs.
	Less:
	Amount realized from the defaulter	Rs.
	Amount recovered out of Sale of goods	Rs.
	Sale of excisable goods	Rs.
	Sale of movable property	Rs.
	Sale of immovable property	Rs.
	Appropriation of Bank Guarantee, if any	Rs.
	Adjustment of Refunds	Rs.
	Other (specify)	Rs.
	Net amount to be written off	Rs.
9.	Details of financial position of the defaulter
10.	Whether any property alienated since the raising of the demand for duty. Step taken to check alienation of property and recovery possibilities out of the same
11	(a) Whether defaulter has been prosecuted? if not, reasons thereof.
	(b) Results of prosecution launched
12	Whether non-recoverability of amount was on account of any defects in Rules and/or procedures, the amendment of which requires the order of higher authorities?
13	Whether there has been any serious negligence on the part of the Government Servants which may call for disciplinary action taken against them.
14	Name and designation of the Government Servants, if any, responsible for causing loss of revenue and action taken against them.
15	Any other relevant facts/ remarks

Deputy Commissioner/ Assistant Commissioner Incharge

(Name and Signature with date)

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