Service Tax Scrutiny
Must for Max 5% of Returns in Each Commissionerate
[CBEC Circular No. 1004 dated 21st July 2015]
Sub:
Instructions regarding Detailed Scrutiny of Central Excise Returns.
In view of
the self-assessment procedure wherein the assessee
himself assesses the duty liability, the responsibility of the departmental
officers is to scrutinise the assessment made for verification of its
correctness. Return scrutiny is the first line of verification carried out as
soon as the tax return is submitted by the assessee.
A returns scrutiny process consists of two parts viz. preliminary scrutiny and
detailed scrutiny. While the preliminary scrutiny system covers all the returns
filed online, detailed scrutiny system covers a few returns selected on the
basis of identified risk parameters. In exercise of powers conferred under
sub-rule (3) of rule 12 of the Central Excise Rules, 2002, Board hereby lays
down following guidelines for detailed scrutiny of Central Excise Returns:
i) Detailed Scrutiny of Central Excise returns should
be conducted regularly by the proper officers in the field following the
procedure already prescribed. Detailed scrutiny of a minimum of 2% and maximum
of 5% of the total returns received in a month shall be mandatorily performed
by the proper officer.
ii) Selection of assessees
by the Commissionerates for detailed scrutiny shall
be based on Risk score and procedure for using it, as forwarded by DG (Audit)
vide letter F. No. 381/20/2015 dated 18.05.2015. Chief Commissioners and
Commissioners shall also have powers to manually select returns for detailed scrutiny
using such criteria as deemed fit to further complement the list of assessees selected on the basis of risk. After selection of
units centrally, month-wise detailed scrutiny plan should be laid down by the Commissionerate headquarters for each Range, conveyed to
the Range and monitored for compliance.
iii) As assessee who has been
selected for audit in a given financial year shall not be selected for detailed
scrutiny. Further, once the return of an assessee has
been selected for detailed scrutiny, the return of the assesse should not be
selected again for the next 12 months for detailed scrutiny.
iv) Once an assessee has been
selected for detailed scrutiny, most recent return filed by that assesse should
be used for conducting the detailed scrutiny. During the course of detailed
scrutiny of Central Excise returns by proper officer, the documents and records
of assessees, where necessary, may be called for
verification by proper officer.
v) In Composite Ranges where there are both Central
Excise and Service Tax assessees, the total number of
Central Excise and Service Tax returns to be taken up for detailed scrutiny
shall be same as prescribed at para (i) above. The
ratio of returns for Service Tax & Central Excise to be scrutinised in a
composite range shall be in the ratio of the number of assesses registered as
Service Tax and Central Excise assessees respectively.
For detailed scrutiny of Service Tax returns, Board’s Circular No.
185/4/2015-Service Tax dated 30.06.2015 may be referred.
vi) On issues relating to difficulty, if any, in access
of returns on ACES, DG (Systems) shall be directly contacted/ appraised by the
Chief Commissioner/ Commissioner concerned. Where the problem persists over a long
period of time, the same may be brought to the notice of the Board. In the interim, where necessary, printouts of the return may be
taken from ACES and detailed scrutiny done manually using the printout.
vii) Past circulars/ manuals/ instructions on detailed
scrutiny in conflict with above instructions shall stand rescinded to the
extent of the conflict.
2. Difficulty, if any, in implementation of the
procedure may please be brought to the notice of the Board.
F. No.
206/15/2014-CX.6