Central Excise (Compounding of Offences) Rules, 2005
[M.F. (D.R.) Notification No. 37/2005-C.E. (N.T.), dated
30-12-2005
as amended by Notification No. 42/2007-C.E. (N.T.), dated 27.12.2007]
In exercise of the powers conferred by clause (id) of sub-section (2) of
section 37 read with sub-section (2) of section 9A of the Central Excise Act,
1944 (1 of 1944), the Central Government hereby makes the following rules,
namely :
Rule 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.
Rule 2. Definitions.
- In these rules, unless the context otherwise requires,
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(a)
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"Act" means the Central Excise Act, 1944 (1
of 1944);
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(b)
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"applicant" means any assessee or any other
person, but shall not include officers of Central Excise as appointed by Board
or Commissioner of Central Excise under Rule 3 of the Central Excise Rules,
2002;
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(c)
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"compounding authority" means the Chief
Commissioner of Central Excise, having jurisdiction over the place where the
offence under the Central Excise Act, 1944, have been or alleged to have been
committed;
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(d)
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"form" means the form appended to these
rules;
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(e)
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"reporting authority" means, the
Commissioner of Central Excise, having jurisdiction over the factory/place where
the offences under the Act have been or are alleged to have been committed or
any other officer as may be authorized in this regard by the Chief
Commissioner of Central Excise having jurisdiction over the place where such
offences under the Act have been or are alleged to have been committed;
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(f)
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"section" means a section of the Act; and
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(g)
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words and expressions
used in these rules and not defined but defined in the Act shall have the
respective meanings assigned to them in the Act.
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Rule 3. 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 :
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.
Rule 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.
Provided further that application shall not be allowed unless the
duty, penalty and interest liable to be paid have been paid for the case for
which application has been made.
(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.
Rule 5. Fixation of the compounding amount.-
For the purpose of compounding of offences under the provisions of the Act, the
compounding amount shall be as provided in the following Table, namely :-
TABLE
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Offence
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Compounding amount
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(1)
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(2)
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(3)
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1
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Offence specified under section 9(1)(a) of
the Act
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Rupees fifty thousand for the first offence
and to be increased by hundred per cent of this amount for each subsequent
offence.
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2
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Offence specified under section 9(1)(b) of
the Act
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Up to fifty per cent of the amount of duty
evasion, subject to minimum of ten per cent of duty evasion.
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3
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Offence specified under section 9(1)(bb) of
the Act
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Upto fifty per cent of
the amount of duty evasion, subject to minimum of ten per cent of duty
evasion
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4
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Offence specified under section 9(1) (bbb) of the Act
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Upto twenty five per
cent of the amount of duty evasion, subject to minimum of ten per cent of
duty evasion.
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5
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Offence specified under section 9(1)(bbbb) of the Act
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Upto fifty per cent of the
amount of CENVAT Credit wrongly taken or utilized, subject to minimum often
per cent of said amount.
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6
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Offence specified under section 9(1)(c) of
the Act
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Rupees fifty thousand for the first offence
and to be increased by hundred per cent of this amount for each subsequent
offence.
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7
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Offence specified under section 9(1)(d) of
the Act
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Upto twenty five per of
the amount of duty evasion, subject to minimum of ten per cent of duty
evasion.
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Provided that if a person has,
in respect of same goods, committed offences falling under more than one
category specified above and where amount of duty evasion or amount of CENVAT
Credit wrongly taken or utilized is same for all such offences, the compounding
amount, in such cases, shall be the amount determined for the offence for which
a higher compounding amount has been prescribed.
Rule 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.
Rule 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.
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FORM
(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.
DECLARATION
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.
VERIFICATION
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.
Place:
Date:
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