Steel makers term tax demand by central excise department as unjustified

Steel makers in Punjab have termed the excise duty demand
raised by the central excise department as unjustified and has sought
intervention of the chairman of Central Board of Excise and Customs in
the matter. 

“The department has indulged in pick and choose method in issuing show
cause notices to firms … had the (excise) officials honest in their approach,
notices would have been served upon all the units as the industry as a whole
follows cash discount practice and claims burning losses,” said CISPA
Chairman Vinod Vashisht. 

According to CISPA, the department has raised excise duty demand over Rs 5
crore by issuing notices to several steel rolling mills in Punjab after
auditing their accounts. 

The excise department has slapped demand notices on steel units after raising
objection to industry's 'cash discount' practice and quantum of burning loss
being shown in production. 

The audit wing of the department has demanded excise duty from steel rolling
mills be paid on the cash discount being availed from the input supplier. 

“This is an old practice which is being followed in which we get discount
from our suppliers on payment of input and we also offer discount to our buyers
on finished product. There is no way where the excise department suffers any
loss,” Vashisht said. 

Steel rolling mills get discount on raw material supplies from induction
furnaces if the payment is made within a certain timeframe, Vashisht said who is
also the President of All India Steel Rerollers Association.

Source: The Economic Times