Central Excise (Compounding of Offences) Rules, 2005
(As notified vide Notification No.37/2005-Central Excise(NT) dated 30th December,2005 under clause (id) of sub-section (2) of section 37 read with sub-section (2) of section 9A of the Central Excise Act, 1944)
1. Short title and commencement. -
(i) These rules may be called the Central Excise (Compounding of Offences) Rules, 2005.
(ii) They shall come into force on the date of their publication in the Official Gazette.
2. Definitions.- In these rules , unless the context otherwise requires,
Explanation.- Where an offence under the Act has been committed at more than one place falling under the jurisdiction of more than one compounding authority, then the Chief Commissioner of Central Excise having jurisdiction over such place where the value of goods seized, or the amount of duty evaded or attempted to be evaded is more than the others shall be the competent authority.
4. Procedure on receipt of application under rule 3 - (1) On receipt of an application under rule 3, the compounding authority shall call for a report from the reporting authority with reference to the particulars furnished in the application, or any other information, which may be considered relevant for examination of such application.
(2) Such report shall be furnished by the reporting authority within a period of one month or within such extended period as may be allowed by the compounding authority, from the date of receipt of communication from the compounding authority.
(3) The compounding authority, after taking into account the contents of the said application, may, by order, either allow the application indicating the compounding amount in terms of rule 5 and grant him immunity from prosecution in terms of rule 6 or reject such application:
Provided that application shall not be rejected unless an opportunity has been given to the applicant of being heard and the grounds of such rejection are mentioned in such order.
(4) A copy of every order under sub rule (3) shall be sent to the applicant.
(5) The applicant shall, within a period of thirty days from the date of receipt of order under sub- rule (3) allowing the compounding of offences, pay the compounding amount, as ordered to be paid by the compounding authority and shall furnish the proof of such payment to the compounding authority.
(6) The compounding amount once paid shall not be refunded except in cases where the court rejects grant of immunity from prosecution.
(7) The applicant cannot claim, as of right, that his offence shall be compounded.
5. Fixation of the Compounding amount.- For the purpose of compounding of offences under the various provisions of the Act, the compounding amount shall be as provided herein below,-
6. Power of Compounding authority to grant immunity from prosecution. -
The compounding authority, if he is satisfied that any person who has made the application for compounding of offence under these rules has co-operated in the proceedings before him and has made full and true disclosure of facts relating to the case, grant to such person, subject to such conditions as he may think fit to impose, immunity from prosecution for any offence under the Central Excise Act, 1944 with respect to the case covered by the compounding of offence.
7. Withdrawal of Immunity from Prosecution in certain conditions. -
(1) An immunity granted to a person under rule 6 shall stand withdrawn if such person fails to pay any sum specified in the order of compounding passed by the compounding authority, under sub-rule (3) of rule 4 within the time specified in such order or fails to comply with any other condition subject to which the immunity was granted and thereupon the provisions of the Central Excise Act, 1944 shall apply as if no such immunity had been granted.
(2) An immunity granted to a person under sub rule (1) above may, at any time, be withdrawn by the Compounding authority, if he is satisfied that such person had, in the course of the compounding proceedings, concealed any particulars, material or had given false evidence, and thereupon such person may be tried for the offence with respect to which immunity was granted or for any other offence that appears to have been committed by him in connection with the compounding proceedings and thereupon the provisions the Central Excise Act, 1944 shall apply as if no such immunity had been granted.
(see rule 3)
Application for Compounding of Offence
1. Full Name and address of the applicant:
2. Address for communication:
3. (i) Permanent Account Number (PAN):
(ii) Registration No:
4. Commissioner of Central Excise having jurisdiction over the applicant:
5. The violation of provisions of Central Excise Act, 1944, against which prosecution is instituted or contemplated for which application of Compounding:
6. Details of invoices/Adjudication order in relation to the case for compounding:
7. Date of seizure, if any:
8. Brief facts of the case and particulars of the offence(s) charged:
9. Whether Show Cause Notice issued
10. If yes, details of duty demanded
11. Whether Show Cause Notice has been adjudicated
12. If yes, adjudication details
(a) Amount of duty confirmed
(b) Amount of CENVAT credit to be recovered/denied
(c) Fine imposed
(d) Penalty imposed
13. Whether this is the first offence under the Central Excise Act, 1944. If not details of previous cases:
14. Whether any proceedings for the same offence contemplated under any other law, if so the details thereof:
Name and Signature of the applicant.
1. I shall pay the compounding amount, as may be fixed by the compounding authority under sub-rule (3) of Rule 4 of the Central Excise (Compounding of Offences) Rules, 2005.
2. I understand that I cannot claim, as of right that the offence committed by me under the Act should be compounded.
Name and Signature of the applicant.
I, ---------------the son/daughter/wife of----------------residing at ------do solemnly declare that I am making this application in my capacity as-------- and I am competent to verify it.
That the contents of this application are true to the best of my knowledge and belief and no information relevant to the facts of the case has been suppressed. The documents accompanying the application are true copies of the originals and the tables showing financial transactions are correct and are duly attested by me.
Verified today the day of (month) (year) at .
Name and Signature of the applicant.
Form and manner of application. – (1) An applicant may, either before or after institution of prosecution, make an application under sub-section 2 of section 9A in the form appended to these rules, to the Compounding authority to compound the offence:
The Central Excise Tariff Act, 1985
An Act to provide for tariff for Central Duties of Excise.
BE it enacted by Parliament in the Thirty-sixth Year of the
1. Short title, extent and commencement.- (1) This Act may be called the Central Excise Tariff Act,1985.
(2) It extends to the whole of
(3) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.
2. Duties specified in the First Schedule and the Second Schedule to be levied. - The rates at which duties of excise shall be levied under the Central Excise Act, 1944 (1 of 1944) are specified in the First Schedule and the Second Schedule.
3. Emergency power of Central Government to increase duty of excise. - (1) Where, in respect of any goods, the Central Government is satisfied that the duty leviable thereon under section 3 of the Central Excise Act, 1944 (1 of 1944) should be increased and that circumstances exist which render it necessary to take immediate action, the Central Government may, by notification in the Official Gazette, direct an amendment of the First Schedule and the Second Schedule to be made so as to substitute for the rate of duty specified in the First Schedule and the Second Schedule in respect of such goods, -
(a) in a case where the rate of duty as specified in the First Schedule and the Second Schedule as in force immediately before the issue of such notification is nil, a rate of duty not exceeding fifty per cent ad valorem expressed in any form or method;
(b) in any other case, a rate of duty which shall not be more than twice the rate of duty specified in respect of such goods in the First Schedule and the Second Schedule as in force immediately before the issue of the said notification.
Provided that the Central Government shall not issue any notification under this sub-section for substituting the rate of duty in respect of any goods as specified by an earlier notification issued under this sub-section by that Government before such earlier notification has been approved with or without modifications under sub-section (2).
Explanation. - "Form or method", in relation to a rate of duty of excise, means the basis, namely, valuation, weight, number, length, area, volume or other measure with reference to which the duty may be levied.
(2) Every notification under sub-section (1) shall be laid before each House of Parliament, if it is sitting, as soon as may be after the issue of the notification, and, if it is not sitting, within seven days of its re-assembly, and the Central Government shall seek the approval of Parliament to the notification by a resolution moved within a period of fifteen days beginning with the day on which the notification is so laid before the House of the People and if Parliament makes any modification in the notification or directs that the notification should cease to have effect, the notification shall thereafter have effect only in such modified form or be of no effect, as the case may be, but without prejudice to the validity of anything previously done thereunder.
(3) For the removal of doubts, it is hereby declared that any notification issued under sub-section (1), including any such notification approved or modified under sub-section (2), may be rescinded by the Central Government at any time by notification in the Official Gazette.
4. Consequential amendments of, and construction of references to the First Schedule to Act 1 of 1944. - In the Central Excise Act, 1944,-
(a) for the words "First Schedule", wherever they occur, the words and figures "Schedule to the Central Excise Tariff Act, 1985" shall be substituted;
(b) in section 2, for clause (f), the following clause shall be substituted; namely :-
'(f) "manufacture" includes any process,-
(i) incidental or ancillary to the completion of a manufactured product; and
(ii) which is specified in relation to any goods in the Section or Chapter Notes of the Schedule to the Central Excise Tariff Act, 1985 as amounting to manufacture,
and the word "manufacturer" shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in their production or manufacture on his own account;'
(c) the First Schedule shall be omitted.
(2) Any reference to the expression "First Schedule to the Central Excise Act, 1944 (1 of 1944)" in any Central Act shall, on and after the commencement of this Act, be construed as a reference to the Schedule to this Act.
5. Power of Central Government to amend First and Second Schedules. — (1) Where the Central Government is satisfied that it is necessary so to do in the public interest, it may, be notification in the Official Gazette, amend the First Schedule and the Second Schedule:
Provided that such amendment shall not alter or affect in any manner the rates specified in the First Schedule and the Second Schedule in respect of goods at which duties of excise shall be leviable on the goods under the Central Excise Act, 1944 (1 of 1944).
(2) Every notification issued under sub-section (1) shall be laid, as soon as may be after it is issued, before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the notification or both Houses agree that the notification should not be issued, the notification shall thereafter have effect only in such modified from or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that notification.
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