Jamshedpur, March 2: “The Union Budget for 2016-17 presented by the finance minister Arun Jaitley gave has many ups and downs and one of the most glaring negatives of the Budget is to bring the jewelers within the ambit of excise duty.
The draconian Rule 25 of the excise duty has been re-imposed on them,” a press release issued by the Singhbhum Chamber of Commerce and Industry (SCCI) stated on Wednesday.
According to the press communiqué, as far as the retail jewelers are concerned, there is hardly any manufacturing activity left. Despite this excise duty has been imposed on them. It is important to note that excise duty is only levied on manufacturing.
“Whatever activity is taken up by retail jewelers is in the form of cottage industry. Already a hefty 10 percent custom duty exists on all imported gold and silver. While this has already given rise to large-scale smuggling, the new taxes can again call for bypassing the tax net, thereby promoting illegal trade.
While the Union government is stagnant with CST and ED rates on the pretext of imposing GST, the state government has imposed a cumbersome business process in the state taxes in their preparation for GST, the release said, wondering why the government to imposing these taxes before GST.
The SCCI and the jewelers have objected to the following features of the Rule 25 of Excise Duty:
o Section A says, 7 years of imprisonment if the duty evasion is more than Rs. 25 lakh.
o Power to cease the materials, and seal the shop has been provided.
o Section 11A C has provisions for penalty equivalent to the tune of duty.
o Section 11DD includes provision for seizure of property of the owner and a jail term of up to 6 months.
o Section 23 has provisions for non-compliance to the direction of the excise officer and a jail term for 3 months.
An additional jail term can be imposed for arguing with the excise officer in addition to seizure of materials.
o Rule 7 makes it mandatory for refining of gold only by government organization.
o If records of stock re not found in proper order, shop can be sealed.
o If proper records not found with the artisans and die-makers, materials can be seized.
o Refined gold to be only purchased from a government organizations via cheque payment.
The SCCI has stated that they stand firm by the jewelers in their fight against the re-imposition of the excise duty on the sector.