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MoF includes service tax in reward scheme

TIOL News Service | May 11, 2004 15:02 IST

In a significant move, the ministry of finance has decided to take service tax more seriously as a powerful fiscal tool.

And the latest indicator is the inclusion of service tax in the existing 'Reward Scheme' of the Central Board of Excise and Customs.

By effecting an amendment in the scheme, the ministry has added service tax cases to be eligible for reward to the officers as well as informers.

Given that there was no incentive so far for booking service tax cases like the central excise, officers posted at Service tax divisions never used to take interest. In fact, detecting service tax evasion was normally treated like an optional or imposed exercise. Some cases have been booked only after either the chief commissioners or commissioners have taken personal interest.

Now that a reward tag has been attached to it, the industry can certainly expect a rise in the number of cases which are going to be booked in the current fiscal year.

What may further give a rise to detection drive is another amendment in the 'Reward Scheme'. As compared to Rs 10 lakh upper ceiling imposed on the total reward which can be earned by an individual officer in his entire career, the CBEC has hiked it to Rs 1.5 million. Though the recommendations from field formations were to hike it to Rs 2 million, the board did not find it wiser to go for 100 per cent hike.

Though the board saw rationale in hiking the total reward figure but forgot to make a commensurate amendment making even joint commissioners eligible for this reward. Given that the quantum of reward has indeed become respectable and, a large number of officers in the department have become JCs, it would have been ideal to make them eligible for the reward.

Keeping them out of the ambit is certainly not a good decision and the CBEC top brass should take into accounts various changed parameters after the re-structuring and make the amendment.

Apart from these two significant changes which are equally applicable to the lot of informers from the industry, the CBEC has also made some changes in the constitution of various panels which are going to decide the reward in various cases. The scheme has indeed been made attractive for the large community of informers who would certainly find it worth taking the risk.

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