Thursday, March 5, 2015

SPEECH OF Ms. ARUNDHATI BHATTACHARYA, CHAIRMAN, SBI ON EXCISE DAY FUNCTION.

SPEECH DELIVERED BY Ms. ARUNDHATI BHATTACHARYA, CHAIRMAN, SBI, AS GUEST OF HONOUR, ON THE OCCASION OF EXCISE DAY FUNCTION. 

Ms. ARUNDHATI BHATTACHARYA, IS A FAMILIAR FACE AND VOICE OF DAY-TO-DAY ECONOMIC AFFAIRS.  HER UNDERSTANDING AND VISION, POSITIVE APPROACH AND DEDICATION TO MAKE INDIA STRONG AND TO ROLL OUT THE POLICIES OF THE GOVERNMENT WITHOUT ANY FEAR AND FAVOUR IS LAUDABLE.  MUMBAI IS LUCKY ENOUGH TO HAVE SUCH A DIGNITARY AMONGST US, WHO NOT ONLY SHARES HER VIEW BUT POINTED OUT THE IMAGE OF THE DEPARTMENT AMOUNG THE GENERAL PUBLIC AND THE MINDSET OF THE TAX PAYER. 

Smt Arusha Vasudev, Shri V.S. Krishnan, Shri Alok Chopra, dignitaries on the dais, Ladies and Gentlemen,

            First of all, congratulations on the Central Excise day 2015.  My heartiest congratulations also to all the winners of the certificates today.  When I first received this invitation, I was a little puzzled as to why the Central Excise department thought it fit to accord this honour to me.  But then, I realized , you know, I couldn’t possibly get such a chance of getting so many tax people to talk to and in such a situation where they couldn’t talk back to me.  So I thought you know this is definitely an occasion I should take up.  Of course, the organization that I head, it is one of the largest tax payers in the country. Whether it be Income tax, we are normally between the first two alongwith ONGC or it be Service tax where also we are among the first two alongwith LIC. So, we are very large tax payers in this country. But the sad thing is in this country is somehow or the other, a sense of pride is not attached with the paying of taxes and that is something, I think I thought I should talk to you as to how is it that we can inculcate in our people this sense of pride because without taxes, without the work that you are doing to collect revenue, we cannot definitely build this country.  You know there are certain games that doctors play in which they will give you certain words and ask you whether it is arousing in you a positive response or a negative response.  Say for instance, I use the word, say something like a butterfly.  Most of you will immediately have a happy thought.  At the same time, if I use the word tax, most of you even though, you are tax people, will have a negative thought.  Now, why should that be the case and I think we need to go to the root of this problem.  We have just heard that GST is about to come in and my sincere request as a tax payer both as a corporate and as an individual is that we must make GST something that will be easily understood and easily operationalized.  One of the main reasons why we have this negative response whenever we hear the word tax is because of the difficulty of its implementation. In India, somehow or the other, whether it is in the area of tax or whether it is in the area of any other regulation, our regulations are meant to prevent abuse and it is not meant for the ease of implementation.  The reason again is that our systems are not able to catch hold of abusers very quickly and punish them properly.  As a result, we instead, make our regulations so convoluted and so difficult because we believe this is the best way to prevent its abuse.  I think first of all we need to get some trust back within ourselves.  We must trust people today to do the right thing.  Today the Prime Minister for instance, is saying that you don’t need to get anybody to attest your papers.  You can do self attestation because we trust you.  So also I think we need to bring in more of a regimen of trust while ensuring that we make the implementation and the people who look for abuse much stronger so that the abuse can be quickly caught and can be justifiably punished.  Because unless we do that no matter how much we try to make the ease of business better, it’s not going to happen
            We need to get back trust in our people, trust in our country and we need to ensure that as the new regime of GST kicks in we keep this in mind, we keep in mind the fact that there are people out there who are honest , who want to comply by everything but unless you make it easy enough to comply , you will have layers and layers of people in between who will ensure that they take advantage of all the loops and loopholes that are available and they really turn the system on its head and therefore, the implementation becomes more and more difficult.  I think the other thing in respect of taxes is that we need the Government to show how these revenues are being used.  Again, why these negative thoughts?  The negative thoughts happen in the minds of the citizens because very often they are not able to realize or not able to understand what their money is being used for.We have very little accountability that we can get from the Government sources as to the actual use that the money is being put into and therefore, if there is an effort from the Government to  show where your hard earned money is going how people in the country, how you or your dependents are benefitted from it, we will find that the tax compliance will become that much better and that much more amenable to the people who actually pay the taxes.  So I think you know overall in respect of taxes this is a very important job that you all do, you all organize the revenue collection for the country without that we wouldn’t have a government, we wouldn’t have any social infrastructure, but we need to ensure that the people whom you tax or from whom you collect that they also see them as a part of the system, that they are willing and co-operative alongwith you to ensure that the system works properly and well and that together, we can take up the nation building that the Chief Minister just talked about a few minutes back.  It is indeed true today India is the flavor in all international forums.  The no. of invitations we keep getting in order to address the international investors is astounding.  A year back, nobody was interested in us.  But that is precisely the point. A year back nobody was interested in us.  It should not be that a year hence, people will again lose interest.  And therefore, because of that reason, we need to ensure that whatever keeps people interested, whatever is good for the country, whatever ensures that this country can come up to its potential, all of us together need to do it.
            Thank you again very much for inviting me and all the very best on your Central Excise day.

Wednesday, March 4, 2015

HISTORY OF TAX REGIME FROM 1870 TO UPCOMING GST

Speech delivered by Shri. V. S. Krishnan, Chief Commissioner, Central Excise Zone I and Service Tax, Mumbai on the occasion of 71st Central Excise day.

Celebration of the Central Excise day function started since 1994 as represented by the then All India Secretary General Shri. R. C. Sharma, first at Mumbai then thereafter all over the country.  But the speech delivered earlier by the dignitaries was more of ritualistic nature than factual.  The following speech is based on the facts and road map towards new tax regime.  Hope viewers will appreciate.

Dear ……….

            Central Excise duty is an important source of revenue for the Union Government accounting for more than 15% of the total estimated revenue collection of 13 lakh crores for 2014-15. The Central Excise duty has a long history dating back to the Mauryan Era.  In 1870, excise duty was levied on salt for the first time. This was followed by levies on cotton textiles in 1884, petroleum (motor spirit) in 1920, kerosene in 1922, silver in 1930 (unimportant after the formation of Burma in 1933), sugar and steel ingots in 1934, tyres in 1941, manufactured tobacco and vegetable products in 1943 and coffee and tea in 1944.  These excise levies collected under separate enactments were consolidated and brought under a single legislation called the Central Excise and Salt Act, 1944.  This Act received the formal assent of the then Viceroy of India on February 24th, 1944, and this day is being celebrated as Central Excise Day.
            The Central Excise Department has over the years re-invented itself with the evolution of the economy.  The first major step was taken in 1969 with the introduction of the Self Removal Procedure, which was followed by the introduction of Modvat Credit system in 1986, wherein the cascading effect of tax on tax was offset by allowing credit for duty paid on inputs.  This was followed by the introduction of Service Tax in 1994, which was the pre-cursor to the idea that Indirect Taxes should be levied on all value-additions and that hair clips must be treated on par with haircuts.  This in turn was followed by the introduction of Self Assessment in 1996.  These measures have helped in shaping a Modern Tax Administration. 
            One of the principles underpinning Indirect Tax Reforms is that the Government must not use Central Excise duty as an instrument to achieve multiple socio- economic objectives as the proliferation of objectives diffuses the focus, complicates the tax procedures and creates administrative irritants.  Therefore, in the 1990s, the Government, based on the recommendations of the Chellaiah Committee reduced the number of duties from 22 to 3 and phased away a large number of end-use exemptions.  While liberalizing the tax regime, Central Board of Excise & Customs introduced a Modern Audit System in Nov-1999 in consonance with best international practices.
            Today, the Department is on the cusp of the most important tax reform, in post Independent India, which is the introduction of the GST.  Under this tax regime, both the Centre and the State will levy taxes on the same tax base covering the whole value chain from raw material to retail.  All major Central and State Indirect Tax levies would be subsumed in the GST and the taxable event would be based on the simple principle of supply of Goods and Services for a consideration.  The GST, which is proposed to be implemented w.e.f.  April 2016 would have the effect of creating an Indian Common Market which would considerably reduce the cost of moving goods and services across the country, thereby stimulating public and private investment.  An historic parallel was the passing of the Inter State Commerce Act of 1887 by the US Congress which streamlined tariffs charged by Railroad companies for movement of goods between States by rail.  This legislation reduced the cost of moving goods across the country and created a trigger movement for the US economy using the scale effect of a huge market.
            While a great growth opportunity beckons, successful implementation of the GST would require building new administrative structures, where Central and State officials can interact on a continuous basis.  The creation of an Empowered Committee of State Finance Ministers was a master stroke for it facilitated the implementation of State VAT in May 2004 and the design of the GST in 2014. We need new administrative structures for implementation of the GST.  One idea is to create  an Empowered Committee of State Chief Secretaries and  Principal Chief Commissioners headed by the Finance Secretary and also comprising of the Secretary(Revenue), Chairman, CBEC and the Member GST. This body, like the Empowered Committee of State Finance Ministers, could be a registered body funded by the Central Government and can use the existing Secretariat of the Empowered Committee of State Finance Ministers, which can be augmented. Similarly, we would also need to create a registered co-ordination body at the State Level comprising of the State Chief Secretary and the Principal Chief Commissioner along-with other officers, who could be co-opted.  These structures need to be created quickly and I would request the Chief Minister of Maharashtra to look at this suggestion and take it up with the Central Government.  Similarly we need to create a Dispute Resolution system which can resolve disputes speedily and ease the cost of doing business in India.  This would certainly give a fillip to the PM’s clarion call of “Make in India”.
            In conclusion I would like to recall the words of Jean Baptist Colbert, Louis XIV’s treasurer and probably the first great tax reformer, who said, “The art of taxation consists in so plucking the goose as to obtain the largest amount of feathers with the smallest amount of hissing.”  The GST by bringing in fairness in taxation can perhaps maximize the plucking while minimizing the hissing.

*************

Monday, March 2, 2015

UNMANNED CBEC


The above cautions public against loss of life.
Now similar is the situation in CBEC for cautioning against loss of revenue.
Unmanned CBEC (vacant)
Member CBEC – in single digit.
Chief Commissioner/Commissioner – in double digit
Assistant Commissioner – in three digit
Inpsector & Superintendent – in four digits.

Saturday, February 28, 2015

CENTRAL EXCISE DAY FUNCTION AT NATIONAL MUSEUM, NEW DELHI.

On the eve of Excise day a function was held at the Auditorium. National Museum, Janpath, New Delhi on 24th February, 2015 Shri Jayant Sinha, MOS Revenue was the Chief Guest and Shri Shaktikant Das, Revenue Secretary was the Guest of Honor CBEC Chairman Shri Kaushal Shrivastav who chaired the  function alongwith Member CBEC Shri S. B. Singh and Ms. Jaikumari Chander.  Invitees  from the trade staff present and retired and meritorious officers of CBEC around Forty officers were nominated.  Apart from other parts following officers from Mumbai Zone were nominated for commendation.  
1.    Ms P Sharda Rao, Superintendent, Confidential Section , Mumbai Zone
2.    Shri Ganesh Moholkar, Superintendent,  Service Tax Audit-I
3.    Shri P. A. Vincent, Superintendent, LTU (Audit)

4.    Shri Deepak M. Parab, Havaldar, Confidential Section, Mumbai-I 

Friday, February 27, 2015

NO MORE CENTRAL EXCISE DAY – GST IS COMING

            On the occasion of Central Excise day at a function held at Birla Matoshree Auditorium at Marine Lines, Mumbai, Mr Devendra Fadnavis, the Chief Minister of Maharashtra, graced the occasion and delivered his speech expressed his happiness and greeted the entire fraternity on the occasion.  He said that in future there will be no Central Excise Day, it is the last such function because the tax regime will change and GST will come into existence in 2016.  For bonding between Centre and State and effective administration the organizers, in anticipation, had invited him. 
            Mumbai, contributes nearly 12 per cent of the Central Excise revenue and one third of the country's Service Tax revenue, and the Chief Minister believes that after the Implementation of Goods and Service Tax (GST), the revenue through tax collec­tion will increase.
            The Chief Minister has also emphasized the need for cooperation between the Centre and the states to ensure a smooth transition to GST, the implementation of which has been proposed for April 2016.
            The Chief Minister reminded the gathering that when value-added tax (VAT) had been introduced, some states opposed it, anticipating revenue collec­tion losses. However, every­body accepted it later.
            "Now, the Central govern­ment is planning to imple­ment GST from April 2016, it will definitely be benefi­cial for both state and traders," Mr Fadnavis said.

            Recalling his Davos tour for the International Investment Summit, Mr Fadnavis said, "Global investors are opting for India for investment. For that we must have a firm and easy tax system and investment friendly atmos­phere." He emphasized on the need for cooperation between the Centre and the states to ensure smooth transition to GST, saying that GST would strengthen cooperative federalism.

Thursday, February 26, 2015

IF I WERE FINANCE MINISTER


I feel now every housewife should help the finance minister prepare the budget

==

No, that is not what my job is. I know finance ministers are never praised. Even for rights they are criticized and for wrongs lambasted. In reality, I feel that most finance ministers don’t understand the bureaucratic statistical jugglery. I too.

I feel now every housewife should help the finance minister prepare the budget. I have heard that wives of many finance ministers, including of Manmohan Singh, were unhappy with the budgets presented by their husbands.

I told my wife Anju, to help me in that process. She said: “Please stop doing that. Except bringing lots of raddi, Budget has not ever helped me”. That’s brusque for an onerous job that fills half the newspaper and television news time through the year. Are they all producing raddis? The Budget has no sanctity. My better half says, “It has only one sanctity. After each Budget, problems go up, processes become complicated and prices of commodities rise. After a Budget I buy less than what I bought for the last one year”.

Should the government then stop making the budget, I ask. She says, “No. Its ingredients remain the same. Why don’t you standardize to bring out the budgetary statement in an automatic fashion.” How is it possible?

She brings some old budget papers without the cover and asks, “Tell me which year’s Budget these are?” I can’t make out. Figures look so similar. The style has not changed and every Budget claims better days – ache din ayenge. My wife knows better than me that she was happier when salary and income was far less than what I, my son or daughter has today. I agree.

But she throws up a challenge. “You claim to know so much about the budget. You have been the worst critics of finance ministers. Why don’t you prepare one for me? At least prove me wrong”. She even threatened like the tax man: “If you don’t, I will stop preparing food for the family”.

Having suffered under the hands of fnance ministers, and having starved often, I didn’t want the children to suffer. With a glum face, that is how I have seen most finance ministers, I sit down to prepare the onerous national duty.

I write: I shall abolish income-tax: She asked me why? I told her at least I can buy my lunch, which I often forgo. It would also save me from taking loans at high interest to pay for my granddaughter’s primary education. She was furious. “Do you want the government to starve”, she asked like a capitalist-communist. I feebly explain: “The government wouldn’t be a bit poorer. Of course, many tax officers would lose a lot–their jam and butter. The government could do well to sack at least two-thirds of them and save over Rs 2 lakh crore – more than Rs 1.75lakh crore that I-T brings. It would also save lakhs of people harassment, despite having paid what they could”. She agrees, but adds: “Why should the I-T officer and his gang agree. You don’t know the dynamics of dealings”. I said, “You are right, but Prime Minister wants a clean India and I want to help him”.

Abolish tax deducted at source on bank deposit: Anju said, “That is sensible. I have lost much. But I can somehow bear it. But do you know my maid complained she lost sums for keeping her money in the bank. I have advised her not to do it again”. This was my turn to be furious: “You have done great disservice to the nation. If people won’t put money in banks where would the government get money to borrow and run the administration? Most government servants would not get their salary either”. Cursing me she said, “Government should be honest and shouldn’t loot poor man’s money”. She was making sense.

End Education cess: I tell her, the government is charging cess too for education. But do you know the education shops have been sold to private looters, sorry educators. They are bleeding us. Why should I pay this cess? She said, “You are right. My father used to say that schooling was so affordable and quality was good. If the Government can’t do its duty, why should it levy any charge?”

Make agriculture fundamental of economy: Anju disagreed. “You would remain in the medieval ages. I know how zamindars in my village used to look down upon the kisans. They are rustics, don’t understand. If their land is used for industry so many jobs can be created and they could live like babus”. This was a bit too much for someone, who was steeped in Gandhism, as is our Prime Minister. I replied: “If kisan wouldn’t till the land, where would you get your basmati rice, MP Sona wheat, the delicious fruits and vegetables, which you love the most. Do you know over 75crore people of the 125crore population still subsist on farming? No industry can give kisans jobs. If the kisan doesn’t do farming, no industry would give a job to turn him into a babu. He would come to the city with a begging bowl. Would you like that?” She says, “You are right”.

(Courtesy : Orissa Post of February 25, 2015)


Tuesday, February 24, 2015

CELEBRATION OF CENTRAL EXCISE DAY AT MUMBAI.




CELEBRATION OF EXCISE DAY IS SCHEDULED AT BIRLA MATRUSHREE AUDITORIUM ON 24TH FEBRUARY 2015. 
Hon’ble CHIEF MINISTER OF MAHARASHTRA WILL BE THE CHIEF GUEST & MS. ARUNDATTI  BATTACHARYA, CMD, SBI, WILL BE GUEST OF HONOUR UNDER THE CHAIRMANSHIP OF THE CHIEF COMMISSIONERS, SHRI. V. S. KRISHNAN AND MS. ARUSHA VASUDEVAN.  FOLLOWED WITH MUSICAL ORCHESTRA AND GUEST APPEARANCE OF SEVERAL CELEBRITIES OF THE FILM INDUSTRY. 
APART FROM THE ABOVE,  MERITORIOUS WARDS OF THE STAFF WILL ALSO BE FALICITATED FOLLOWED WITH OUR STAFF WHO HAVE EXCELLED DURING THIS YEAR.  THEY ARE :
PRESIDENTIAL AWARD WINNERS
1. Shri Gavin D'Mello, Superintendent
SPECIAL ACKNOWLEDGEMENTS
1. Dr. K. M. Soni, Chief Engineer, CPWD, West Zone-I, Mumbai
2. Shri Ravi Barapatre, Sr. Accountant, P.A.O., C.Ex, M-I
OFFICERS UNDER THE CATEGORY OF MERITORIOUS OFFICERS / STAFF
3.Shri Nitin Gaikwad,  Superintendent, PCCO, C.Ex., MZ-I
4. Shri Vivek Mukund,  Superintendent, CCO, S. Tax, Mumbai Zone.
5. Shri Dhanpal Meena, Superintendent, C.Ex., M-I
6. Shri Haresh Gangaramani, Superintendent, C.Ex., M-I.
7. Shri Balwant T Ajagekar, Superintendent, C.Ex. M-IV
8. Shri Vikram Kulkarni, Superintendent, C.Ex, Thane-II
9. Shri S.D. Sharma, Superintendent, C.Ex, Thane-II
10. Smt. Marykutty Mathew, Superintendent, S. Tax Audit-I
11. Shri P.P. Janardhanan, Superintendent, S. Tax-VI
12. Shri P. A. Vincent, Superintendent, LTU Audit
13. Smt. Jolly Verghese, Superintendent, LTU Mumbai
14. Shri Chetan M. More, Superintendent, C.Ex., MZ-II
15. Shri J.G. Shende, Superintendent, C.Ex., M-III
16. Smt. Kavita S. Lobo, Superintendent, C.Ex.,Belapur
17. Shri Sandeep Kudi, Superintendent, C.Ex.,Belapur
18. Shri Manish S. Chowdhury, Superintendent, C.Ex.,Raigad
19. Shri G. Abraham, Superintendent, C.Ex.,Raigad
20. Shri H. S. Chawla, Superintendent, C.Ex., Mumbai-IV
21. Shri Anil Thakare, Inspector, PCCO, C.Ex., MZ-I
22. Shri Charan Balwant Dungardan, Inspector, PRO, C.Ex., M-I
23. Shri Shailendra Thukrul, Inspector,S. Tax-II
24. Smt. Shivagami Sathyanarayanan, D.O.S., C.Ex. M-II
25. Shri Prem Singh, Stenographer,S. Tax-I
26. Shri Sanjay Narkar, Hawaldar, S.Tax-V
27. Shri R. J. Mirza,Hawaldar, C.Ex., M-III
OFFICERS UNDER THE CATEGORY OF EXCELLENCE IN SPORTS AND OTHER FIELDS.
1) Shri Sanjeev Mehra, Superintendent, S.Tax Audit-III
2) Smt. Minoti Prasad, Superintendent, C.Ex., Mumbai-V
3) Smt. Meenakshi Salvi, Superintendent, C.Ex., Raigad
4) Smt. Nadiya Shaikh, Inspector, Cus (Prev.), M&P Wing
5) Shri Viral Shah, Inspector, C.Ex., Mumbai-I
6) Shri S.R. Dontulla, Hawaldar, C. Ex., Mumbai-V

DETAILS OF THE PROGRAMME FOLLOWS: