CHAPTER - I
Central Excise Receipts

1.1    Budget estimates, revised budget estimates and actual receipts *

The budget estimates, revised budget estimates and actual receipts of central excise duties during the year 1998-99 to 2002-03 are exhibited in the table below:-

(Amount in crore of rupees)

* Figure furnished by Principal Chief Controller of Accounts (Central Board of Excise and Customs).

The actual collections fell short of the budget estimates as well as the revised estimates year after year. Despite this the government continued to make optimistic projections during presentation of the annual budget. The budget estimate 2002-03 was pitched at Rs.91,141 crore, an increase of 11.5 per cent over budget estimates, 22 per cent over revised estimate and 26 per cent over actuals of 2001-02. The collections fell short of the budget estimates by Rs.9,100 crore or 9.98 per cent and short of revised estimates by Rs.4,952 crore or 5.6 per cent in 2002-03.

1.2    Value of output* vis-à-vis central excise receipts

The value of output from the manufacturing sector vis-a-vis receipt of central excise duties through Personal Ledger Account (cash collection) during the years 1992-93 to 2002-03 are as follows:

(Amount in crore of rupees)

* Includes value of all goods produced during the given period including net increase in work-in-progress and products for use on own account. Valuation is, at producers values, that is the market price at the establishment of the producers. As separate figures of value of production by small scale industry units and for export production were not available, these have not been excluded from the value of output indicated. Value of output for the year 2002-03 is based on estimates. Source : Central Statistical Organisation (Government of India).

The above table reveals that while value of output had increased by a factor of 2.87 during the period 1992-93 to 2002-03, the corresponding increase in the central excise receipts was by a factor of 2.68.

1.3    Central excise receipts vis-a-vis Modvat/Cenvat availed

A comparative statement showing the details of central excise duty paid through Personal Ledger Account (PLA) and the amount of Modvat/Cenvat availed during the year 1992-93 to 2002-03 is given in the following table:

(Amount in crore of rupees)

The above table shows that while the central excise receipts had grown by 2.68 times during the decade 1992-93 to 2002-03, the increase in Modvat/Cenvat availed during the relevant period had been 4.89 times.

1.4    Cost of collection *

The expenditure incurred during the year 2002-03 in collecting central excise duty alongwith the corresponding figure for the preceding four years is given below:-

(Amount in crore of rupees)

* Figure furnished by Principal Chief Controller of Accounts (Central Board of Excise and Customs).

1.5    Outstanding demands *

The number of cases and amount involved in demands for excise duty outstanding for adjudication/recovery as on 31 March 2002 and 31 March 2003 are as follows :

(Amount in crore of rupees)

* Figure furnished by the Ministry of Finance (the Ministry) and relates to 92 Commissionerates

A total of 67275 cases involving duty of Rs.36495.49 crore were pending as on 31 March 2003 with different authorities.

1.6    Fraud/presumptive fraud cases *

The position of fraud/presumptive fraud cases alongwith the action taken by the Department against the defaulting assessees during the period 2000-01 and 2002-03 is depicted in the following table :

(Amount in crore of rupees)

* Figure furnished by the Ministry and relates to 92 Commissionerates

The above data reveals that while a total of 4634 cases of fraud/presumptive fraud were detected during the years 2000-03 by the Department, involving a duty of Rs.4602.85 crore, the Department raised a demand of Rs.2388.45 crore only and recovered Rs.362.50 crore (15.17 per cent) out of it. Similarly, out of penalty of Rs.558.04 crore imposed, the Department recovered only Rs.8.35 crore (1.49 per cent).

1.7    Commodities contributing major revenue *

Commodities which yielded revenue of more than Rs.1000 crore during 2002-03 alongwith corresponding figures for 2001-02 are as follows :

(Amount in crore of rupees)

* Figure furnished by the Ministry.

The above table reveals that there was a shortfall in collection of revenue during 2002-03 in refined diesel oil, cigarettes and cigarillos of tobacco or tobacco substitutes and pharmaceutical products of (-) 6.15, (-) 0.22 and (-) 0.39 per cent respectively over previous year.

1.8    Contents of report

This section contains two reviews ‘Call book’ and ‘Determination of assessable value under new section 4 (transaction value)’. The revenue implication is Rs.7040.39 crore. Besides, there are 166 paragraphs, featured individually or grouped together, arising from test check of records maintained in departmental offices and the premises of the manufacturers pointing out leakage of revenue aggregating Rs.1445.59 crore. Of these the concerned Ministries/Department had (till December 2003) accepted audit observations in 133 paragraphs involving Rs.287.61 crore and recovered Rs.32.82 crore. In 166 cases, based on available information, statutory audit detected objections in 157 units where internal audit had already been done.