CENGO INDIA ( DEDICATED TO ALL CENTRAL EXCISE, SERVICE TAX AND CUSTOMS GAZETTED EXECUTIVE OFFICERS): DRAFT MEMORANDUM FOR SUBMISSION BEFORE 7TH CPC---PART-I

All India Association of Central Excise Gazetted Executive Officers:

Memorandum

Submitted before the Chairman 7^th Central Pay Commission, New Delhi

We on behalf of the All India Association of Central Excise Gazetted Executive Officers (Recognised by Govt. of India under F No. B-12017/10/2006-Ad IV A dated 21.01.2008) do here by submit the Memorandum along with a copy of reply/suggestion to the prescribed questionnaire with reference to the terms of references for kind consideration and favourable order by the Hon’able 7^th Central Pay Commission for fixation of appropriate pay scale with other benefits including retirement appropriate benefits in the Cadre of Superintendent of Central Excise, Customs and Service Tax, which is an Executive cadre (Group – B Gazetted), functioning under the Central Board of Excise & Customs, Department of Revenue, Ministry of Finance, Govt. of India. As a prelude to submission on the pay scales/grade pays of Superintendents of Central Excise, Customs and Service Tax , it is imperative to bring to the kind notice of the Hon’able 7^th Central pay Commission , about the department and the nature of works, performance and gravity and intensity of the responsibilities discharged by the Superintendents vis-à-vis the pay scales of the identical and analogous cadres , which would help the Hon’able Commission to arrive at a decision for constructing and recommending a judicious and rationale pay structure and other benefits for the cadre of the Superintendent of Central Excise, Customs and Service Tax. After cogitating, on the terms of reference and making an in-depth study of the complexities associated with the job, we are making the comprehensive submission to the 7^th CPC. The main objective before the 7^th CPC is to transform the Central Government Organisation in to Modern, Professional and Citizen friendly entities that are dedicated to the service of the people vis-a –vis pay packages and other benefits to e recommended.

PART-I

ABOUT THE DEPARTMENT & CADRE OF SUPERINTENDENT OF CENTRAL EXCISE, CUSTOMS & SERVICE TAX AND ITS DUTIES, RESPONSIBILITIES & COMPAREBILITY WITH SIMILARLY PLACED EMPLOYEES OF OTHER DEPARTMENTS:

The Ministry of Finance responsible for administration of the finance of the Central Government. It is concerned with all economic and financial matters effecting the country as a whole including mobility of resources for development. It regulates the expenditure of the Central Government, including the transfer of resources to states. The Ministry comprises five Departments namely:

(a) Department of Economic Affairs;

(b) Department of Expenditure;

(d) Department of Disinvestment and

(e) Department of Financial services.

Out of the above five departments, the Department of Revenue is one of the departments of the Ministry of Finance. The Department of Revenue of Govt. of India exercises control in respect of matters relating to all the direct and indirect Union taxes through two Statutory Boards namely the Central Board of Direct Taxes (CBDT) and Central Board of Excise and Customs (CBEC). Matters relating to levy and collection of Customs duty, Central Excise duties, Service Tax and control over Narcotics fall within the purview of the CBEC, whereas those relating to the levy and collection of all direct taxes looked after by the CBDT.

During 1963, the combined Board namely Board of Revenue was divided into CBDT and CBEC and these two Statutory Boards were constituted under the Central Board of Revenue Act, 1963. The Central Board of Excise and Customs (CBEC) deals with the task of formulation of policies concerning levy and collection of Customs & Central Excise duties and Service Taxes, prevention of smuggling and administration of matters relating to Customs, Central Excise Commissionerates, the Narcotics Comissionerates and Central Revenue Control Laboratory, DGDRI, DGCEI, DG-AUDIT, DG SERVICE TAX etc.

During financial year 2012-13, the indirect tax revenue collection was Rs. 474575 crore . This indicates a growth of 20.9 % over actual collections in 2011-12, despite general economic slowdown and relatively low level of industrial output in 2012-13.This increase was possible because of the efforts were being made by all the Superintendents of Central Excise, Customs and Service Tax posted throughout the country. The major head wise details of indirect tax revenue collections during 2012-13 are tabulated below:

Major Tax Head	B.E 2012-13	R.E 2012-13	Actuals 2012-13 (prov.)	Growth over 2011 - 12	Collection over BE	Collection over RE
Customs	186694	164853	165289	10.7%	88.5%	100.3%
Union Excise	194350	171996	176685	21.3%	90.9%	102.7%
Service Tax	124000	132697	132601	36.0%	106.9%	99.9%
Total	505044	469546	474575	20.9%	94.0%	101 . 1%

Revenue Trends In F.Y: 2013-14(April-December): The Budget Estimate (BE) 2013-14 for indirect tax has been pegged at 565003 crore, which is about 19.0% higher than he the previous year's revenue receipts. The major head wise details of indirect tax revenue collections during 2013-14 fiscal years up to December 2013 is tabulated hereinafter;

Indirect Tax Major Head	Budget Estimate 2013-14	Revenue Collections *April to December 2013
Indirect Tax Major Head	Budget Estimate 2013-14	2012-13	2013-14	Growth (in %)	%BE Achieved (Up-to
					Dec,2013)
Customs	187308	118393	126285	6.7	67.4
Central Excise	197554	124016	118405	(-)4.5	59.9
Service Tax	180141	91900	110313	20.0	61.2
Total	565003	334309	355003	6.2	62.8

Voluntary Compliance Encouragement Scheme, 2013 (VCES): In Service Tax, a new scheme was introduced to encourage voluntary compliance with the following main features:

(i)The scheme can be availed of by non-filers or stop-filers or persons who have not made a truthful declaration in their return. However it will not be applicable to persons against whom any inquiry or investigation is pending by the issue of search warrant or summon or by way of audit;

(ii)The defaulter will be required to make a truthful declaration of all his pending tax dues (from October1, 2007 to December 31, 2012) and pay at least half of that before December 31, 2013; remaining half to be paid by:

(a) June 30, 2014 without interest; or

(b) By December 31, 2014 with interest from July 1, 2014 onwards;

(iii)On compliance with all the requirements the person will have immunity from interest (as specified), penalties and other proceedings.

Arrests and Prosecutions: Section 104 of the Customs Act, 1962 contains provisions relating to arrest. This section has been amended to make certain offences punishable under section 135 as non-bailable. The offences are:

(A) Evasion or attempted evasion of duty exceeding fifty lakh;

(B) Clearance of prohibited goods notified under section 11 which are also notified under sub-clause (C) of clause (i) of sub-section (1) of section 135;

(C) Import or export of any goods which have not been declared in accordance with the provisions of this Act and the market price of which exceeds 'one crore;

(D) Fraudulently availing of or attempt to avail of drawback or any exemption from duty provided under this Act, if the amount of drawback or exemption from duty exceeds fifty lakh.

Barring the offences mentioned above, all other offences under the Customs Act are bailable. Similar changes have been made in the Central Excise Act, 1944 and Finance Act, 1994 (relating to Service tax).

Anti-Smuggling Unit: The Anti-Smuggling Unit (AS Unit) of Central Board of Excise and Customs (CBEC) provides an enabling environment to officers working in DRI / DGCEI and other field formations of CBEC by providing anti-smuggling equipment, vehicles, updated policy guidelines and operating procedures to detect and curb evasion of Customs duty and frauds and to augment revenue. In the FY 2013-14 (up to Sept, 2013), following achievements and initiatives were taken by AS Unit.

a) To curb duty evasion overseas, India has signed Customs Mutual Assistance Agreements (CMAAs) and Memoranda of Understanding (MoUs) with other countries for sharing of intelligence and availing investigation assistance. The Customs Overseas Intelligence Network (COIN) provides actionable intelligence for facilitating seizures of offending goods and to detect evasion of Customs duty. COIN also utilises the platform provided through CMAAs/MoUs to obtain documentary evidence in this regard. Presently nine COIN units are operational abroad. Efforts are being made to create seven more COIN units in consultation with Ministry of External Affairs.

b) The Directorate General of Revenue Intelligence (DRI), interalia, disseminates information about new modus operandi of duty evaders and smugglers by sharing details of important cases booked by it through issue of alert circulars. The alert circulars are also used for targeting in the Risk Management Framework. The field formations and DRI also share the information /intelligence and details of cases with other agencies directly as well as by reporting to the Central Economic Intelligence Bureau (CEIB) and at Regional Economic Intelligence Councils (REIC) meetings. Policy directions issued by the Finance Minister in the Economic Intelligence Council (EIC) meetings are circulated by Anti-Smuggling Unit to DRI. DGCEI and field formations for compliance.

c) The National Import Database (NIDB) and Export Commodity Data Base (ECDB) help in detecting under-valuation/misdeclaration of imported/export goods, which are reported to be the oft-used route for Customs commercial frauds and Trade Based Money Laundering (TBML). The Intelligence Support System (ISS) developed by DGRI generates workable intelligence by analysing macro-level inputs which helps in detection of commercial fraud, evasion of customs duty and misuse of export incentive. Trends in smuggling report are issued from time for the guidance of field formations.

d) The list of sensitive commodities prone to smuggling, are circulated to field formations on the basis of cases detected in the past. These include Narcotics & Other Psychotropic Substances, Gold, FICN, Red Sanders, and Memory Cards etc. The major commodities prone to evasion in terms of commercial frauds are Betel Nuts, Parts & Accessories. Non Edible Crude Palm Oil, Iron Ore Concentrate, Aircrafts, Cigarettes, Ozone Depleting Substances (R -22 Gas), Garments & Accessories etc.

e) During the year, as part of the institutional support for the field formations, revised Arrest Guidelines have been issued, Annual Action Plan for acquisition for anti-smuggling equipments has been prepared, the norms for weapon requirement for field formations has been finalised and Indian Customs Canine Squad Manual for a Sniffer Dog Establishment has been issued.

Anti-Smuggling Performance of DRI and Commissionerates at a Glance: Supported with the above logistics and institutional support, the DRI Ad field formations of CBEC have performed well. The results achieved include details of seizures made, commercial fraud cases detected, persons arrested, and persons detained by Customs Authorities. These are the major achievement by all Superintendents of Central Excise, Customs and Service Tax posted throughout the country.

Anti-Smuggling Performance:

Sr.no.	Item of work	2011-12		2012-13		2013-14 Up to Sep 2013
		Number	Value/Duty	Number	Value/duty	Number	Duty
1	Seizures	25537	4522.89	28317	3079.43	7561	25535.71
	Gold	486	46.43	871	99.34	299	6237.37
	Narcotics	480	1711.93	470	969.15	113	13726.45
	FICN(Face Value)	25	2.64	21	2.23	00	00
	Others	23797	728.37	26375	386.24	7149	5571.89
	Commercial Fraud	749	2033.52	580	1622.47	112	31107.79
2	Commercial Fraud Cases Detected	5333	2198.20	5390	5970.38	864	17812.76
	Under Valuation	558	498.84	1961	320.2	71	647.42
	Mis-declaration	1386	913.32	1217	2673.12	240	5737.93
	Misuse of DEEC/Advance License Scheme	6	14.02	11	139.99	1	18.78
	Misuse of DEPB Sheme	59	25.42	18	22.94	0	0
	Misuse of EPCG Scheme	30	82.41	25	231.85	2	373.32
	Misuse of EOU/EPZ/SEZ Scheme	9	9.88	9	44.13	1	6.13
	Misuse of Drawback Scheme	138	31.06	175	825.82	38	3575.16
	Misuse of end-use & other notifications	104	343.34	220	1609.92	67	1363.48
	Others	3043	279.91	1754	102.41	482	9665.70
3	Duty Recovered	6243	610.63	6757	1603.52	976	4656.96
4	Persons arrested	597		575		231
5	Persons detained	35		28		5

So far seizures made and persons arrested these are highest in numbers in comparison to other Central Government Departments such as Income Tax, BSF, CRPF, CBI, IB, CISF, ITBP etc., during the relevant period.

Litigation & Adjudication Policy: During the year, CBEC has taken several measures to streamline the process of Departmental adjudication and litigation before various appellate authorities and judicial fora. These include:

(a) Creation of six additional benches of CESTAT in Delhi, Mumbai and Chennai and setting up new benches in Allahabad, Chandigarh and Hyderabad.

(b) The monetary limit of single member bench has been increased from Rs 10 lakh to Rs 15 lakh in the Finance Act, 2013.

(c) Several changes have been made in the procedure for examination of the proposals to file then SLP in the Supreme Court. This has been done with a view to avoid filing of SLP in a mechanical manner on frivolous grounds, resulting in less number of SLPs and civil appeals having been filed in Supreme Court in 2012-13 as compared to previous year.

Drawback Division performs the following functions:

i. Fixation of All Industry rates of Duty Drawback;

ii. Monitoring of sanction and disbursal of drawback by the field formations; and

iii. Liaisoning with the DGFT on all export promotion (EP) schemes, their operationalization and monitoring (except SEZ, EOU and Gem and Jewellery schemes which are being monitored by the DGEP).

Achievements during the calendar year 2013: The major work done by the Drawback Division during the period 01.01.2013 to 31.12.2013 is as follows:

Foreign Trade Policy

(A) The import of catalyst was allowed under EPCG Authorization vide Notification no. 3/2013- Customs dated 13.02.2013.

(B) Vishakhapatnam Airport and Kattupalli (Tamil Nadu) port were included in the list of Airports/ ports in Export Promotion Customs Notifications vide notification no. 4/2013-Customs dated 14.02.2013 and notification no. 20/2013-Customs dated 03.04.2013 respectively.

(C) Two notifications nos. 5/2013-Customs and 6/2013-customs both dated 18.02.2013 were issued to implement post export EPCG duty credit scheme under Chapters of Foreign Trade Policy (FTP).

(D) Two notification nos. 2/2013-Central Excise and 3/2013-Central Excise both dated 18.02.2013 were issued to enable the use of duty credit scrips (granted under post export EPCG Duty Credit Scheme under Chapters of the FTP) for procuring goods from domestic manufacturers by debit of central excise duties in the scrip, subject to conditions specified in the exemption notifications.

(E) Norms for execution of bank guarantee in respect of EPCG schemes were relaxed vide circular no. 8/2013 dated 04.03.2013.

(F) The changes announced in the Annual Supplement 2013-14 to the Foreign Trade Policy 2009- 14 by Ministry of Commerce on 18^th April, 2013 were implemented vide Notification Nos. 21/ 2013-Cus, 22/2013-Cus, 23/2013-Cus, 24/2013-Cus, 14/2013-Central Excise,15/2013-Central Excise, 6/2013-Service Tax, 7/2013-Service Tax, 8/2013-Service Tax, all dated 18.4.2013, 17/2013-Central Excise and 29/2013-Cus, both dated 16.5.2013 32/2013-Customs, 21/2013- Central Excise and 11/2013- Service Tax, all dated 13.6.2013 and Notification No. 46/2013- Customs dated 26.09.2013. Among the changes implemented are:-

i. A single zero duty EPCG scheme for all sectors was notified. This rationalized and harmonized the earlier two EPCG schemes of zero and 3% duty. The definition of 'export obligation' has been made stricter. Units in Jammu and Kashmir have been permitted lowered specific EO like the units North Eastern States and Sikkim. The restrictions on simultaneously availing TUFS and single zero duty EPCG have been removed. Consequently, a single Post Export EPCG Duty Credit Scrip Scheme was also notified. In this, all duties are paid in cash at time of import and the basic duty is granted as remission in the form of duty credit scrip in proportion to export obligation fulfilled.

ii. The usage of duty credit scrips that would be issued under the Incremental Exports Incentivisation Scheme on annual basis for 2013-14 (a variant of the Focus Market Scheme), was notified by amendment to Focus Market Scheme;

iii. The freely transferable reward scrips (FMS, FPS, VKGUY) were enabled for utilization for payment of service tax on procurement of services;

iv. Import of cars, etc as commercially registered Tourist vehicles for hotel and tourism industry was brought under usage of Served From India Scheme (SFIS) scrip and it was deleted from the EPCG scheme.

v. Exemption from anti-dumping duty and safeguard duty under Duty Free Import Authorization (DFIA) was made applicable only in case of actual user. On transfer of DFIA this facility was withdrawn.

vi. Under Served from India Scheme (SFIS) duty credit scrips, in the case of service provider who is also engaged in manufacturing activity, the import of capital goods including spares related to its manufacturing sector business has been permitted, subject to certain conditions.

vii. In the case of Agri. Infrastructure Incentive Scrip (AIIS) issued to Status Holders, transferability of the scrip to a supporting manufacturer has been allowed, subject to conditions.

viii. Under Status Holders Incentive Scrip (SHIS) issued to Status Holders, the transferability of the duty credit scrip has been allowed within the group company which is a manufacturer, subject to conditions.

ix. 36 Notifications pertaining to Advance Licences, DEEC, Advance Authorisations, DFIA and EPCG Schemes for the Policy period 1992-1997 to 2004-2009 amended for implementing the option to close cases of default in EO notified by the DG FT.

(G) Foreign Post Office, New Delhi included as port of export in Export Promotion customs Notifications vide notification no. 38/2013-Customs dated 26.07.2013.

Drawback Schedule: The All Industry Rates of Duty Drawback Schedule 2013-14 has been notified with effect from 21.09.2013 vide notification no. 98/2013-Cus (N.T.) dated 14.09.2013. The salient features of the Schedule are:-

(a) All Industry Rate (AIR) of Duty Drawback on many items that were already covered under the drawback schedule prior to incorporation of erstwhile DEPB items have been reduced and on few items like gold and silver jewellery, silk yarn, silk fabric, silk garments and made-ups, wooden art-ware etc. have been increased.

(b) The residuary AIR of 1% (composite) and 0.3% (customs) has been provided to hitherto Nil rated items under chapters 4, 15, 22, few items in chapter 24 and casein and its derivatives in chapter 35. AIR has also been provided to articles of silver (silversmiths' wares) subject to similar conditions as applicable to gold/silver jewellery and the Notes and Conditions (22)/(23) of the said Notification shall also have relevance.

(c) The specific rate provided to Ethanol/ENA under tariff item no. 22071090 has been changed to ad valorem 1% (composite) and 0.3% (customs). Ad valorem rates have been provided to certain items of chapter 37 and imitation jewellery of chapter 71.

(d) Though, the existing residuary rate of 1% ad valorem (composite) and 0.3% (customs) continues, the higher residuary rates have been reduced from 1.5% to 1.3% (customs) or from 2% to 1.7% (customs), as the case may be.

(e) The process of realignment of rates, on items incorporated in the drawback schedule from the erstwhile DEPB scheme, was continued along with rationalizing these rates. In general, AIR on these items has been reduced including some to the applicable residuary rate. In the case of certain electronic goods of chapter 84, 85 or 93, the residuary rate has been provided at 1% (customs).

(f) In the case of most tariff items with ad valorem all industry rates above 2%, the rates have been supplemented with drawback caps.

(g) Separate tariff entries have been created for cotton bags, grey and dyed knitted fabrics of cotton, of MMF, of blend where cotton predominates and of blends where MMF predominates, grey and dyed cotton fabrics with lycra, women's/girls' tops, embroidered fabrics of MMF, imitation jewellery of glass, multi-speed complete bicycle with geared hubs, cranks made of aluminum, single speed chain wheel and crank (crank made of aluminum), pillows/cushions/ quilts/pouffles filled with poly-fil/polyfill, etc. A few tariff items have also been replicated with same rates and caps under different four digit levels and descriptions of certain tariff items have been modified to address classification issues.

(h) AIR of Duty Drawback have been provided on milk, milk products, casein and its derivatives and AIR withdrawn on wheat.

Other aspects relating to Drawback: Vide instructions dated 11.10.2013, Board's instructions dated 26.08.2005 issued form F.No. 609/110/2005-DBK regarding grant of provisional brand rate, were reiterated and a time limit of seven days was fixed for issue of provisional brand rate letter in case claim is made under Rule 7 of the Drawback Rules, 1995.

Reforms and Trade Facilitation Measures: CBEC has been an early starter in introducing reforms and substantial reforms have already been carried out in the Central Excise laws and procedures since 1994. The object of these reforms was to repose a greater trust in the tax-payers and bring about a substantial improvement in the delivery system and compliance through automation and trade facilitation measures. CBEC has also undertaken a number of e-governance initiatives with the objective of improving tax-payer services, transparency, accountability and efficiency in the indirect tax administration in India. These applications have automated all major processes in Customs, Central Excise and Service Tax through web-based and workflow-based systems, reducing the physical interface between the tax payers and the Departmental officers, thereby reducing discretion and opportunity for corrupt practices. Details of the important trade facilitation measures are as below:

Customs: Customs has initiated meaningful and effective trade facilitation that reduces transaction costs through the following measures for tax payers:

Automation in Customs: CBEC had modified the Indian Customs EDI System (ICES) in 2009, which has been launched in 109 Customs locations in the country. The Indian Customs EDI Gateway (ICEGATE), the gateway portal hosts a number of services for the EDI partners and provides facilities for e-filing of documents from anywhere at any time (24/7). ICEGATE and ICES 1.5 are serving about 6.7 lakh importers/ exporters and handling nearly 98% of India's International trade. CBEC is among the first Departments that has adopted Information Technology Infrastructure Library (ITIL) framework to provide IT services to end users in a consistent manner. The following taxpayer services have been provided to the importers and exporters:

a) E-filing of Bills of Entry, Shipping Bills, IGM/EGM with electronic acknowledgements.

b) An Accredited Clients Programme (ACP) whereby trusted importers are extended the facility of fast track custom clearance.

c) Connectivity with 17 types of Stakeholders such as Custodian, Port Authorities, Shipping Lines, Airlines, Custom Brokers, DGFT, Banks and other Government Agencies, through electronic messages. This eliminates the need for paper movement across agencies and across locations.

d) Facility of electronic payment of duties.

e) Selective appraisement and examination through the Risk Management System

f) Facility of filing of Bills of Entry and Shipping Bills through Service Centers

g) Documents processed on a First-Come- First-served basis and status can be tracked.

h) Drawback is directly credited to exporters' bank accounts.

i) Electronic Refund of Service Tax paid on exports

j) Uniform applicability of duty rates and trade policy across the country

k) Centralized Bond Management and elimination of Release Advices has enabled traders to file bond at any location and effect clearance from any other location.

l) Electronic transmission of Shipping Bills to DGFT and online receipt of licenses has reduced physical interface with the Departments and has also reduced time and cost of transaction.

m) Round the clock Helpdesk with toll-free number

n) Automated Recording and Targeting System (ARTS) provides protection of Intellectual Property Rights (IPR).

Self Assessment: Self Assessment of Customs duty by importers or exporters was introduced vide Finance Act, 2011. This is a paradigm shift from assessment by Departmental officers to a trust based system of self- assessment. The objective is to expedite release of imported / export goods. The interest of revenue in terms of ensuring correct declarations and duty payment is ensured by an electronic Risk Management System (RMS) that identifies risky consignments for assessment or examination or both. The shift to Self Assessment is aimed at increasing the facilitation level of consignments imported through Air, Sea and Inland Container Depots (ICDs) from the present 60%, 50% and 40% to 80%, 70% and 60%, respectively.

On Site Post Clearance Audit (OSPCA) Scheme: The scheme for On Site Post Clearance Audit' (OSPCA) has been implemented for importers registered under the Customs Accredited Client Programme (ACP). This scheme is aimed at facilitating Customs clearance of goods and reducing dwell time. At the same time, interest of revenue is safeguarded by a comprehensive verification of records and documents at the premises of the importer! exporter on annual basis. Other categories of importers/ exporters shall be considered for inclusion later.

Authorized Economic Operator Programme: Indian Customs Authorized Economic Operator (AEO) Programme has been developed pursuant to World Customs Organization adoption of SAFE Framework of Standards. The programme aims to provide businesses in international supply chain with an internationally recognized quality work highlighting a business role in a secured supply chain and compliance to laws. The full fledged Indian AEO programme was rolled out by the CBEC in 2012 and currently 16 applications are being processed at AEO centers at Regional Units as well as at Headquarters. For wide publicity of AEO programme, pamphlets, posters and advertisements have been circulated amongst the field formations and local newspapers through the Directorate of Publicity and Public Relations. Trade sensitization programmes in zones is currently underway.

24x7 Customs Clearance:

i. In order to facilitate importers and exporters, CBEC began 24x7 Customs clearance from 2012 at identified Air Cargo Complexes, viz., Bangalore, Chennai, Delhi and Mumbai; and Sea Ports viz. Nhava Sheva, Kandla, Chennai and Kolkata in respect of certain categories of imports and exports. This facility has now been extended and presently covers 17 Air Cargo Complexes and 4 Sea Ports.

ii. Clearance of indigenously manufactured goods has been allowed to Duty Free Shops located in the arrival and departure halls of the international airports. The permissible allowance including the restrictions and prohibitions, if any applicable to passengers and members of crew for purchase of the indigenous goods is governed by the same Baggage Rules that govern the imported goods.

iii. Risk Management System (RMS) for exports was introduced with effect from 15.07.2013 at ICDs Patpargang and Mulund. The aim is to expedite the flow of export goods, reduce dwell time port congestion by limiting examination to the risky consignments on the basis of risk parameters.

International Customs Division: The proposal to defreeze the tariff values of imported edible oils,(which had not been revised since August 2006) was implemented on receiving approval of CCEA. This is also a revenue positive measure, as it resulted in increase in the tariff values by over 70%. Tariff value has been introduced on Arecanut to curb under-valuation. The value of most of the imported consignments was earlier being declared in the range of US $ 700 – 800 per MT. The present tariff value is US $ 1816/ MT. This Department has taken a central role in coordinating with various border agencies for facilitation of trade at land borders. This includes holding educational seminars for stake holders on regulatory requirements and pursuing issues of OGA requirements with other Ministries for resolution. In this regard, two Seminars were held in Guwahati and Amritsar where the representatives of the regulatory agencies concerned with imports/exports interacted with trade. Section 69 of the Customs Act, 1 962 was amended to allow for re-export of goods through Post, which were earlier imported by any mode of transport and warehoused, was approved. This could help Indian FPO to become a major transit hub. A scheme for allowing exports through Posts under Export Promotion Reward Schemes has been operationalised.

Interactive website: Indian Customs has developed a user friendly interactive website to enable importers / exporters to know tariff classification, applicable rate of Customs duty and other regulatory requirements for clearance of goods. Interactive website is an effective tool to help educate traders for making correct assessment of duty after introduction of self assessment in Customs.

Central Excise and Service Tax: CBEC has implemented the Automation of Central Excise and Service Tax (ACES) project, a Mission Mode Project (MMP) of the Govt. of India under the National e-Governance Plan. ACES has transformed the way about 20 lakh indirect taxpayers conduct their business with the Department. The application has been rolled-out nationally in 2009 in all 104 Commissionerates.

The following Taxpayer Services are provided under ACES:

i. Online PAN-based Registration of Central Excise & Service Tax Assesses and online amendment. ACES provides for online validation of PAN with the Income Tax database so that when any taxpayer enters a wrong PAN, the system will indicate the same.

ii. Electronic filing of Claims, Permissions, Intimations and processing thereof

iii. Instant e-acknowledgement of documents with Document Identification Number

iv. Viewing, filing and tracking the status of documents online

v. Facility of e-Payment and checking status online

vi. Online Revenue Reconciliation

vii. Online Messages/ Alerts to users on business related matters

viii. Online information to assesses about issuance of Show Cause Notice, Personal Hearing and Orders passed by Adjudicating Authorities

ix. Online filing of replies to Show cause Notices

x. Online filing of application for Provisional Assessment

xi. Online filing and processing of Refund Claims

xii. Online filing of selected Export related documents

Simplified Service Tax Refund Procedure: A simplified electronic Service Tax Refund mechanism beneficial to the exporting community, especially merchant exporters was introduced wherein the tax refund process, which is dealt with by the designated Central Excise and Service Tax officers, is electronically enabled under the Customs application -ICES 1.5.

SEVOTTAM: As a part of the Central Government initiative to improve the quality of public services, the Central Board of Excise & Customs (CBEC) has been identified as one of the 10 organizations with large citizen interface to implement the quality management system for public services. This is based on Indian Standard IS 15700:2005, prepared by the Bureau of Indian Standards (BIS), under the name of "SEVOTTAM". As such at present 13 offices under CBEC is Sevottam Certified and 8 more Sevottam offices are ready for certification Audit. The Department has also selected 47 Commissionerates for Phase-III roll out.

E-Helpline: CBEC has launched an e-helpline facility at the Zonal levels for clarifying the doubts of trade and industry in an administration friendly manner without the assessee having to come to offices of the Department. Taxpayers can also use the e helpline for resolving procedural delays.

Involvement with other countries on Tax matters

Cooperation with BRIGS Countries on Tax Matters: The Heads of Revenue of BRIGS Countries, that is, Brazil, Russia, India, China and South Africa, met in New Delhi on 17"' and 18'" January, 2013 and held discussions on issues relating to International Taxation, Transfer Pricing, Prevention of Cross-border tax evasion and avoidance, exchange of information, sharing of best practices in tax system administration and resolution of disputes. The meeting was inaugurated by Finance Minister of India on 17'" January and was concluded on ^18thJanuary, 2013 by the Revenue Secretary Mr. Sumit Bose. This was the first meeting of the Heads of Revenue and on conclusion of the meeting, a joint communiqué was issued in which the Revenue Heads of BRIGS Countries agreed to develop greater cooperation among their tax administrations on various issues of mutual interest and concerns.

India-Brazil-South Africa (IBSA) Revenue Administration Working Group Meeting: IBSA Dialogue Forum is a trilateral development initiative between India, Brazil and South Africa to promote South- South Co-operation and bring together three democracies, to promote closer co-operation in both tax and customs matters and contribute to the IBSA Dialogue Forum. 8th meeting of IBSA Heads of Revenue Administrations Working Group (HRAWG) was held on 8th November 2013 and the 11th meeting of IBSA Revenue Administrations Steering Group (RASG) was held on 4-7 November, 2013 at Rio de Janeiro, Brazil. Cooperation in the areas of international taxation and transfer pricing, exchange of information, cooperation in multilateral fora, digital economy, aggressive tax planning and capacity building were identified and sub-groups have been constituted to work in these areas for enhanced cooperation.

United Nations TP Manual: The UN Transfer Pricing Manual was released in May, 2013 and is expected to address the concerns of developing countries. India being one of the important developing countries/emerging economies played an active role in the drafting of this Manual.

Coordination with other Multilateral Agencies: India is an Associate member of Center for Inter American Tax Administration (CIAT) a multilateral organization. The efforts of CIAT are focused on cooperation between the tax administrations of different jurisdictions with a view to work jointly against international tax evasion. To fulfill this objective, CIAT organizes different activities, studies. Workshops, Seminars etc. wherein the tax administrations can share their suggestions, practices, experiences, etc. Indian delegates have participated in the meetings of CAT.

The Commonwealth Association of Tax Administrators (CATA) was established as the result of a decision taken at the meeting of the Commonwealth Finance Ministers in Barbados in 1977. India has been an important member of Commonwealth Association of Tax Administrators (CATA) since 1979. CATA's activities include organizing annual technical workshops, high quality training programmes for tax officials, in country training programmes tailored to meet the specific needs of members, publication of a quarterly Newsletter, provision of consultancy services and research facilities for members upon request, the supply of information to members, etc. India participated in the major events organized by CATA during the year and also forwarded reports on strategic objective from Indian point of view.

Indian delegation attended the ITD Global Conference on Tax and Intergovernmental Relations from 3^r"to 5^1hDecember 2013 Marrakech, Morocco, and made a presentation.

the Department of Revenue is responsible for collection of Revenue for the Union Government through two different Boards namely Central Board of Direct Taxes (CBDT) and Central Board of Excise and Customs (CBEC).

. The Enforcement Directorate, Narcotics Control Bureau are also functioning under the Department of Revenue. CBEC consists of two separate and distinct cadre formations. The core sub-ordinate cadre could be considered at the bottom and Indian customs and Central Excise services could be considered at the top. The top management cadre in composed of officers initially directly recruited as Assistant Commissioners and promoted to the level of Chairman and Members of CBEC. Followed by second level of management at the field officers in the grades of Principal Chief Commissioners up to the grade of Assistant Commissioners. The core sub-ordinate cadre consists of Superintendents/ Appraisers. Intake in the core sub-ordinate cadre is at the level of Inspectors/ Preventive officers/ Examiners, which are Group-B posts. The Inspector of Central Excise/ Preventive officers/ Examiner are promoted to the grade of Superintendents of Central Excise/ Superintendent of Customs (preventive)/ Appraisers respectively.

Through the Central Board of Excise and Customs (CBEC) deals with task of policy formulation and administration of indirect taxes through levy and collection of Customs and Central Excise duties, Service Tax and other miscellaneous indirect taxes and matters relating to Narcotics, however recent shift in commodities being smuggled from traditional items like gold, silver, watches etc. to arms, ammunition, explosive, fake Indian currency, Narcotics etc. CBEC focused attention on prevention of smuggling of these contraband goods which are posing a serious threat to national security. The major responsibility in the area of Central Excise is the prevention of leakages in revenues and providing smooth and efficient flow of collections. By revenue points of view, the CBEC is the highest revenue earning source for the Union Govt., which has no parallels.

Superintendent cadre is a Group ‘B’ Executive (Gazetted) cadre in the CBEC hierarchy. A Superintendent on Central Excise front is required to know the basic composition and manufacturing processes of large number of commodities to ascertain the exact nature of classification of the product, feasibility of manufacture in the premises declared, its eligibility to levy and eligibility to different exemptions to arrive at correct rate of duty. A Superintendent of Central Excise must know the requirement of input-raw materials and production norms of each & every product so as to keep watch & control over the behavior or pattern of credits availed. A little unawareness of the fact leads to siphoning of Govt. revenue in unthinkable proportions. All the works pertaining to levy & collection of duty, other aspects like export, drawback, free trade zone, 100% Export Units, refund, prevention of revenue leakage, collection of intelligence and investigation and conclusion of assessment are day-to-day works of Superintendents on Central Excise front for commission or omission of which Superintendent is accountable at the risk of his job. As middle rung supervisory executive, all such responsibilities are solely entrusted upon Superintendents.

On Customs front, a Superintendent deals with import, export, examination, appraising of value and many other activities of highly technical nature all of which relate mostly to International Trade and Commerce. New concepts on Tariffs and Trade in having International ramifications are dealt with by the Superintendent.

The exploration of areas of Service of taxes by service providers, scrutiny of returns to conclude assessment are the look out of Superintendent for which they are solely responsible and accountable.

Canadian Audit has been introduced in CBEC in the scheme known as EA 2000. This scheme is based on modern technique and higher responsibility. Under the scheme there is almost a 50% growth rate on the spot recovery during the last 8 years. Like Senior Audit Offices of AG Office whose scale is Rs. 8000-13500/-, the Superintendents of Central Excise are heading the Audit teams. The functions relating to desk review, preparation of audit plan which are highly technical in nature are being conducted by the Superintendent, Central Excise. Now in the era of liberalization the CBEC has focused on Preventive and Audit in Central Excise & Customs department. In the preventive set up Superintendent is functioning as a team leader like the DSP/ASP of the CBI Department. In EA 2000 Audit the work and responsibilities of Superintendent, Central Excise are at par with the Senior Audit Officer of AG Office.

In the back-drop of such onerous responsibilities that each Superintendent of Central Excise, Customs & Service Tax carries, it is humbly put forth before the Hon’ble Commissioner that in most of the places in India every Superintendent takes the burden of such three levies together all along at the cost of their family & living. Apart from the above, Superintendents are dealing with and are responsible for strict implementation of several allied Acts having bearing on levy and collection of revenue. Few of such allied Acts are given below. About 31 Acts are being enforced and implemented by Superintendents.

1. The Customs Act, 1962.

2. The Central Excise Act, 1944.

3. The Central Excise Tariff Act, 1985.

4. The Factories Act, 1948.

5. The Medical and Toilet Preparation (Excise Duty) Act, 1955

6. The Companies Act, 1956.

7. The Monopoles and Restrictive Trade Policies Act, 1969.

8. The General clauses Act, 1897.

9. The Khadi and other Handloom Industries development (Additional Excise duty on Cloth)Act, 1953.

10. The Textile Committee Act, 1963. The Additional duties Excise (Goods of Special Importance) Act, 1957.

11. All Cess Acts.

12. The Service Taxes provision introduced through the Finance Act, 1994.

13. The Indian Contract Act, 1872.

14. The Sale of Goods Act and the latest.

15. The Finance Act, 1964.

16. The Import and Export Trade Control Act.

17. The Foreign Exchange Regulation Act./FEMA

18. The COFEPOSA.

19. The Narcotic Drugs and Psychotropic Substances Act

20. The Merchant Shipping Act.

21. The Indian Petroleum Act.

22. The Indian Tariff Act.

23. The Arms Act.

24. The Opium Act.

25. The Destructive pests and Insects Act.

26. The Antiquities Export (Control) Act.

27. The Indian Penal Code.

28. The code of Criminal Procedure.

29. The Indian Evidence Act.

30. The Merchandise Mark Act.

31. The Customs Tariff Act.

The job description of Superintendents of Central Excise as enumerated above is not elaborative/exhaustive but only indicative of the huge responsibilities with regard to activities bearing upon levy and collection of Taxes in three vital segments of indirect Taxation i.e. Central Excise, Customs & Service Tax and related technicalities and procedures involved therein. The jobs performed by Superintendents in fields for prevention of smuggling and fighting against smugglers & Drug Traffickers both in land and on boarders entail risk of life and are completely hazardous and arduous by any standards. The High Power Committee in their findings read with letter dated 27.10.1995 of CBEC has unequivocally conceded to it. The Gazetted Executive officers of the Revenue Department in general and Superintendents of Central Excise & Customs in particular are performing certain specialized work, and for comparison of similar post in other Departments, it can be said that the duties and responsibilities of these posts are comparable with the posts of DSP/ASP of CBI Department.

75% of the total revenue of Govt. of India is in form of Central Excise duty, Customs duty and Service Tax which have been collected by CBEC. The Superintendents are mainly responsible for collection of such huge revenue.

The performances of CBEC are furnished below:

Growth in Revenue Collection since 2002-03 (in Rs. Crores)

Sources of Revenue	2002-03	2011-12	2012-13	2013-14 (BE)	% Growth over 2002-03 in 2011-12	% Growth over 2002-03 in 2012-13	% Growth over 2002-03 in 2013-14 (E)
Central Excise	87383	150695	171996	197554	72.45	96.8	122.60
Service Tax	5000	95000	132697	180141	1800	2553	3502
Customs	45500	153000	164853	187308	236.26	262.31	311.66
Total	137883	398695	469546	565003	189.16	240.53	309.76

Increase in Workload since 2002-03

Work Indicators	2002-03	2010-11	2011-12	% Growth since 2002-03
No. of Service Tax Assessees	1,33,531	16,30,317	18,17,415	1261%
No. of Central Excise Units	79,770	3,60,968	3,96,118	397%
No. of Import Export Documents	37,40,970	1,25,88,909	1,36,94,901	266%
No. of Factory Stuffed Containers	1,00,000	10,80,000	12,00,000	1100%
No. of International Passengers	94,00,000	3,79,00,000	4,15,00,000	341%

Other parameters of increase in workload

Function		2004-05			2011-12			% Growth in Value / Duty
Function		Number of cases	Value / Duty (In Rs crore)	Number of cases		Value / Duty ( In Rs. crore)
Anti-smuggling	Seizures	45424	859.31	25537		4523	426
Anti-smuggling	Duty Evasion	1033	1080	5333		2198	104
Anti-evasion	Duty Evasion	7217	3240	7182		15594	381
Audit	Duty Detection	21313	1661	33769		11727	606

Increase in number of sub-formations

Areas	2002-03	2011-12	%age increase
Number of ICDs/CFSs	154	262	70.13%
Airports/Air Cargos	33	39	18.18%
Major Seaports	12	12	0
Minor Seaports	49	84	71.42%
Foreign Post Office	9	10	11.11%
Integrated Check Post	0	2 @	New Formation
LTU	0	5	New Formation

@ (5 more ICPs are likely to be operational soon.)

The working conditions and risk involved in a job have always been the main criteria for considering the fixation of remunerations of the workers all over the world. Therefore the post of Superintendent of Central Excise is entitled to get more pay than its counterparts of other departments. At any time Goods and
Services Tax -- GST may be introduced by CBEC, GST is a comprehensive tax levy on manufacture, sale and consumption of goods and services at a national level. Through a tax credit mechanism, this tax is collected on value-added goods and services at each stage of sale or purchase in the supply chain. The system allows the set-off of GST paid on the procurement of goods and services against the GST which is payable on the supply of goods or services. However, the end consumer bears this tax as he is the last person in the supply chain. GST is likely to improve tax collections and boost India's economic development by breaking tax barriers between States and integrating India through a uniform tax rate. Under GST, the taxation burden will be divided equitably between manufacturing and services, through a lower tax rate by increasing the tax base and minimizing exemptions.

It is expected to help build a transparent and corruption-free tax administration. GST will be is levied only at the destination point, and not at various points (from manufacturing to retail outlets). Currently, a manufacturer needs to pay tax when a finished product moves out from a factory, and it is again taxed at the retail outlet when sold. Therefore , under GST regime , the Superintendents of Central Excise will played a vital role for collection of GST.

The primary problem of taxation in developing countries is one of poor administration. Because low income countries do not efficiently administer the systems they have in place, they fail to collect the optimum amount of revenue due. The efficiency objectives of the tax structure, is not appreciated, and both the horizontal and vertical equity intent of the nominal tax structure is a compromised.

There seems to be a consensus on why tax administration is so poor in developing countries and on what might be done about it. The identified areas are as under:

a) The procedures used are antiquated, and staff are poorly paid and not sufficiently trained.

b) The tax systems in developing countries are too complicated for efficient administration with the modest resources normally made available to Central government tax departments. With the process of liberalization and simplifying the taxing statutes this factor is being neutralized.

In an ideal law abiding Society, people would pay the taxes they owe, and tax administration would amount to little more than the provision of facilities for citizens to discharge the responsibility. No such country exists or never likely to exist.

Compliance with tax laws must therefore be created, cultivated, monitored and enforced in all countries where the taxing laws are simplified. The raison d’etre of the tax administration, entrusted with the responsibility of administering the tax is therefore to ensure highest compliance level of the tax laws.

In the developing countries resources are always limited so no tax administration can play the role of policeman for every potential taxpayer. Partly for this reason the tax system all over the world tended to move towards the design of self- assessment". However self-assessment will result in higher level of compliance only if accompanied by action of the tax administration that lend credibility to the sanction prescribed in the law against non-compliance. Tax compliance will thus be furthered if there is an effective tax administration. Indeed there is a growing conviction against tax policy specialist that "policy change without administrative changes cannot be affected" and that it is critical to ensure that changing tax policy are compatible with administrative capacity. It is now held that in a very real sense effective tax administration is the tax policy so far as developing countries are concerned.

The existence of a sound, healthy and reliable organisation is therefore an efficient ingredient for achieving greater voluntary compliance. So is with the availability of adequate and quality of human resource as well as material resources for carrying out the task of effective administration of the taxation statutes. For achieving affectivity in the implementation of the taxing statute it is therefore necessary that the law enforcing agency is sufficiently complimented with (1) organisational structure, (2) human resources; and (3) material resources.

With respect to staffing appropriate placement of the personnel in concerned positions should be a basic concern of management evaluating and correctly placing a person is necessary requirement for the proper functioning of the organisation. The challenge faced by the management staff is to promote and continuously monitor the efficiency level of each employee, and for achieving this, an equilibrium among three basic variables (1) each employee's individual availability (2) the nature of the work the employee has to do and (3) the compensation he gets . proper exercise of the management responsibility will make it possible to increase job satisfaction and as a result the productivity of the entire organization.

Rational use of available resources supported by modern information technology can improve the capability of the tax administration multifold. For making an optimum use of the available resources it is necessary that all the nooks and corners of the law enforcing agencies are provided sufficient incentives either by way of monetary emoluments, the rewards and elevation in the hierarchical status at regular intervals of service span

Organisational structure is the proper framework required for an organisation to operate as an integrated system that processes and enforces the taxing laws. Delineating the responsibility of each employee and its roles is of immense importance, as much as, correctly defining the interrelationships among the hierarchical ladder. These roles facilitate harmonious operation and allows the entire organisation work towards a common goal. The confusion narrated in the responsibility in discharge of the various roles or the roles are poorly defined, impair the function of organisation. Designing an appropriate organisational structure therefore helps to reduce inefficiency and increases productivity. Employees are benefited from a common set of rules because they know exactly what is expected of them and what objectives are supported to make. This makes it possible to concentrate creative energies needed todo the job effective. The organisational structure of the tax administration establishes the framework of relationships among personnel involved in carrying out numerous distinct but interrelated functions. Within the framework, the continuing challenge of coordinating the numerous specialised activities of tax administration needs to be undertaken with a view to achieving hard-earned harmony in the entire hierarchical structure of the C B E C.

For creating an effective administrative structure it is essential to place the personnel in the appropriate positions -- which should be a basic concern of the management.

Person working in an organisation not only seek fair wages but also an opportunity to work at the levels that allows them to use and to explore his abilities to the optimum extent. It is therefore necessary to monitor and promote proper allocation

The tax administration serves a variety of functions which will have to be carefully matched with the organisational design of the tax department. Where the nature of taxing statutes to be enforced is simple and the number of taxpayers to handle are relatively small organisational design does not matter much. However in a department like Customs and Central Excise where multifarious responsibilities are cast on the officers either by way of enforcing of the complicated taxing statutes or of enforcing of multiple taxing statutes an appropriate design of the organisational setup is the pre-requirement for taxing machinery to be effective.

The functions to be performed by the hierarchical setup can be classified into two distinct classes (1) field functions (2) supervisory functions. In the existing setup of C. B. E. C. although to some extent these two functions are concurrently carried out by the officers in the ranks of Assistant Commissioners, the supervisory functions are carried out by the officers in the ranks of Joint Commissioners up to the level of the Chairman. For an effective administration it is essential to have matching number of officers at the level of Assistant commissioners/Deputy commissioners to the quantum of duties cast on officers of this level by the various enactments. An exaggerated level of monitoring and supervision would confuse the functional responsibility at the level of Joint Commissioner and above disturbing the balancing of the system.

The design of the organisational structure of the tax administration should therefore broadly conform to the following principles: --

A. It should necessarily centralise on a functional basis certain operations in the tax administration to enable each employee to concentrate his efforts on a typical function;

B The process of coordination, interaction, monitoring, and supervision
should be established to ensure performance of all activities in the proper sequence to generate a homogeneous output of the optimum recovery.

The experts emphasise the need to have an appropriate tax administration setup by way of proper organisation and staffing so far as the tax administration with regard to VAT in the developed, semi developed and underdeveloped countries. Aldo Schelemenson, one of the noted commentators in the field has suggested that establishing the concept of responsibility and delegation in the principal of internal organisation is essential for managerial efficiency. According to this concept each level of organisation is of a managerial level. In other words, it should base its operations on the delegation of explicit objectives in terms of quantity, quality, and time required for compliance. The distinct responsibility is required to be created and entrusted to the different set of employees.

The Department consists of two separate and distinct cadre formations. The core subordinate cadre could be considered at the bottom and the Indian Customs & Central Excise Services (IC & CE) could be considered at the top.

The top management cadre is composed of officers initially directly recruited as Assistant Commissioners and promoted to the level of Chairman and Members of CBEC and are ex-cadre posts of the level of Special Secretary to the Government of India . Followed by second level of management at the field officers in the grades of Chief Commissioners, Commissioners up to the grade of Assistant Commissioners.

The core subordinate cadre consists of Superintendents/ Appraisers. Intake in the core subordinate cadre is at the level of Inspectors/P.0.s and Examiners, which are Gr. B (Non Gazetted) posts. From Central Excise flank the Inspector is promoted to the grade of Superintendent (Gr.B gazette). These Gazetted Group 'B' officers are a higher ranked civil servants. These officers in the Central Government are entrusted with the supervisory and managerial role. They are placed at find level of command among the broad Civil servant categories. At present, the Grade Pays and Pay Bands have been created to give huge benefits to Group *A' officers but the Group B' Gazetted Officers have been granted minimal/negligible benefits. Parity is the basic concept of our Constitution. The Ministry of Finance has clearly stated that "in no two organisations, the assigned duties of comparable posts can be totally identical and so in the case with the Gazetted Executive Officers of CBI, IB, Central Police Organisations, Enforcement Directorate, Customs, Income Tax and Central Excise. However, the 1st, 2", 3rd, 4th and 5th Pay Commissions have established the comparable nature of the level of responsibilities assigned to the Gazetted Executive Officers of each of the categories mentioned above by assigning identical pay scales to them. This was also upheld by the committee set up by the then Finance Minister on the subject." The pay scale of Deputy Superintendent of CBI was upgraded by the Government during 1996 retrospectively from 01.01.86 to the level of the Grade Pay of Rs. 5400/- in PB3 disturbing the traditional parity and without upgrading the pay scale of other analogous posts. The pay scale of DCIO of IB was also upgraded by the Government during 1996 to the same level. The analogous counterparts of Enforcement Directorate have also been placed under a Grade Pay of Rs. 5400/, Therefore, the post of Superintendent of Central Excise being an analogous post to Deputy Superintendent of CBI as per the recruitment Rules of the Deputy Superintendent of CBI is entitled to get the pay scale/grade pay equivalent to the later duly classifying such post as Group 'A'. The post of Inspector of Central Excise is the feeder grade for the post of Superintendent of Central Excise and, likewise, the Inspector of CBI is the feeder grade for the post of Deputy Superintendent of CBI. The Government has granted the same Grade Pay, i.e., Rs. 4600 in P11-2 to both of the above categories of the Inspectors. Hence, both the promotional posts are also required to get equal grade pays since the same date. As per the Recruitment Rules of CBI framed under article 309 of Constitution of India, the Central Excise and Customs Department is considered as a Central Police Organisation. Accordingly, the executive posts of Central Excise department are considered as analogous posts to respective levels in CBI and, therefore, executive officers of Central Excise department are entitled to join CBI on deputation. The Executive Officers of Central Excise and Customs Department are uniform bearing Officers. Even the recommendations of the 6^th CPC under para 7.14.25 to maintain parity between the post of Chief Enforcement Officer and Central Excise Superintendent etc. have also not been implemented.

The Central Excise and customs Department has the same structural features, same command & control elements as in Police Organization and Defence forces. The Central Excise and Customs executive officers also serve under similar harsh service conditions as the Police/ Army. In spite of the similarities in the duties performed by the Central Excise & Customs personnel and Defence and Police personnel, the former ones are deprived of privileges extended to Defence and Police services. The command, control and also rank structure of Central Excise & Customs are similar to the Army/ Police except that the ranks in Central Excise & Customs has different nomenclature (Chairman, Member, Principal Chief Commissioner, Chief Commissioner, Commissioner, Additional Commissioner, Joint Commissioner, Deputy Commissioner, Assistant Commissioner, Superintendent, Inspector, Havaldar and Sepoy). In accordance with the NDPS Act and the Central Excise Act, the powers of the Police officers are vested into executive officers of Central Excise. The personnel of Central Excise and Customs are deployed on the borders (with Pakistan, Bangladesh, Nepal, China, Myanmar etc.), International Airports and International Sea Ports. They are also actively engaged in counter insurgency operations against dreaded smugglers, hard core criminals, white collared criminals and chronic tax evaders etc. within the country. These personnel have suffered heavy casualties while dealing with trans-border crimes and countering with dreaded smugglers. Their duties are akin to the Army and they are responsible not only for guarding the Economics borders of the Country but also for security of the Nation. In fact in J & K and North Eastern states of India, the Central Excise personnel are deployed side by side with the Army, BSF, CRPF and ITBP on the same location. They perform their duties in most adverse conditions coupled with the threat to the lives of them & their families by enemy action, insurgents dreaded smugglers, hard core criminals and the climatic hazards.

The Govt. declared before the IV CPC that Executive Officers of Central Excise and Customs Department are uniformed officers and are performing more arduous and hazardous nature of duties than executive officers of other departments like CBI & IB etc. The first level of gazette officers such as the Superintendent of Central Excise and Customs is also the first appellate officer with whom the public has to confront while dealing with the department. These officers not only display the stamp of authority of the government to the general public but also present the true face of the government to the people. In fact, the attributes of government are measured and tested by the actions and behaviour of these first level gazette officers who actually create the image of the government. This means that a happy & contended first level gazette officer will impact the efficiency, effectiveness and image of the government in positive manner. His/her remunerations & career prospects should be augmented & refurbished to an optimum level to serve the best interest of the Government. Raja Chellia Committee also recommended higher pay scales for executive officers of the taxation department. The revenue officers throughout the world are also better placed than others in r/o pay matters and career prospects. In spite of the fact that the service conditions of Central Excise & Customs personnel are akin to the Central Police Organisations, CBI and Defence Armed Force personnel; they are not compensated with any additional incentives or allowances as in the case of CBI, Police, Army etc. For example, an Army personnel posted in Leh-Ladakh region gets Military Service Pay but a Central Excise & Customs personnel serving under same conditions is deprived of the same without any potent reason. The post of Superintendent of Central Excise is an analogous post to the post of Deputy Superintendent of CBI and DCIO of IB but the higher benefits granted to the later ones apart from higher Group ‘A’ salary, one month additional pay in the year, 25% extra salary per month etc. have not been granted to the Superintendent of Central Excise & Customs. The denial of benefits to the Superintendent of central Excise at par with the Deputy Superintendent of CBI etc. is discriminatory, arbitrary, illegal and unjustified.

The officers and staff working in the Revenue Department, are required to discharge their duties and responsibilities in such a way that the tax is collected properly and effectively without causing any harassment to the bonafide tax payers. The liberalized policy being followed throughout the world, has made it compulsory to our country also to make the provisions related to tax collection drafted in easy language and understandable to all persons. The said liberalized policy has made the work of the tax men more sophisticated and with technical precision. The worldwide increase of terrorism and insurgency coupled with narco-terrorism have made the job of anti-smuggling more risky and full of hazards. In this backdrop, the officers and staff working in the Revenue Department, are not only required to be acquainted with different statutes other than the taxation statutes in one hand and on the other hand required to be dare devil to face any consequences arising out of the situation for the said tax collection and anti-smuggling activities.

In the backdrop of crucial role played by the Revenue Department in garnering adequate resources for developmental purposes can hardly be over-emphasised. The last decade saw a healthy and gradual enlargement of tax base and upsurge in revenue collection. As a result, contribution of tax revenue as a percentage of GDP which was 9% a decade ago has now gone upto 11%, while the cost of tax collection is as low as Rs.0.68 for every Rs.100, one of the lowest in the world. Greater reliance is now placed on (a) moderation in tax rate (b) enlargement of tax net (c) simplification of rules and procedures and changed scenario and objectives the existence of an efficient tax administration to fulfill the goals of economic policy is the need of the hour. But it is distressing to note that officers of the Revenue Deptt. , particularly Inspector and Superintendent in the department of Central Excise and Customs who constitute more than 50% of the total workforce of these two departments and working in the field level to implement the various policies of the Govt. have been discriminated against the similarly placed officers working in other Deptts of Central Govt. in the matter of pay-scale and promotional opportunities. The importance of an efficient workforce is well recognized by different tax reform committees including the committee headed by Dr. Raja Chaliah. The said committee in para 10.2 observe that the Government should recognize the paramount importance of Revenue Department and should spare no efforts in improving their condition of service, technical skill and work environment. Further in para 10.3, the committee observing that taking into account the vital role that the Revenue Department should play in garnering adequate resources for ensuring the security of the Country as well as substantial economic growth with social justice, recommended that the salary scales and promotional prospect of the officers and staff in the Revenue Department should at least be comparable with the best that Government offers to its employees. In many develop countries, Revenue Officers are treated differently in the matter of pay and other benefits.

The terms of reference of the 7th Central Pay Commission inter cilia covers scrutiny of the pay scales and other fringe benefits of Central Govt. employees. This memorandum attempts to highlight and brings to the kind notice of the Hon'ble Commission about the pay structure of the Superintendent of Central Excise, Customs & Service Tax Department and unjust treatment meted out to the cadre in spite of glaring facts and pronouncements which are apparent on the face of record itself. There cannot be any difference of opinion that the salary of any officer should commensurate with his job. The 5^thPay Commission also expressed its view that "equal pay for equal work", "fair comparison" and "intrinsic value of job" should be the major principles / criteria for pay determination. The Association, before going to suggest the Pay Commission to recommend salary and other benefits to its members, likes to place the job performed in collection of Central Excise and Customs Duties and also Service Tax, as follows :-

SCHEDULE OF WORK AND STATUTORY OBLIGATION OF
SUPERINDENT OF CENTRAL EXCISE

1. Drawal of samples for correct classification.

2. Determination of value of the goods for assessment. With the introduction of
Transaction value, the entire responsibility of determination of value including determination of value in other circumstances not covered under the aspect of Transaction Value has come on the shoulders of the Superintendents of Central Excise.

3. To undertake preventive patrol for exercising control over the assessees and to prevent clandestine removal of excisable goods even in remote and inaccessible regions.

4. Examination of accounts and physical verification of stocks to prevent leakage of revenue and misuse of concession and exemption.

5. Conducting search and effecting seizure and arresting offenders.

6. Verification in connection with Registration of assessee is borne by the
Superintendent & specially the recent system of post verification has become very important. The misuse by some readymade garment manufacturers who claimed false rebate without existence of any factory, could not be prevented because the government did not specify and rather exempted such verification in case of those manufacturers.

7 Full responsibility of the Superintendent to verify the credit taken on the duty
paid on inputs, Capital goods and input services under Cenvat Scheme and issuing of certificates to the manufacturers and provider of taxable services to facilitate taking of credit. (Explanation appended to Rule 9 (3) of the Cenvat Rules, 2004.

8. Remission of Central Excise duty not exceeding one thousand rupees where the goods have been lost or destroyed by natural cause or by unavoidable accident or unfit for consumption and marketing before removal.

9. Recommendation for grant of Refunds.

10. Detection of offence, drafting of show cause notice after investigation and full assistance in adjudication of offence cases.

11. Scrutiny of orders to see their legality and propriety.

12. Defend cases before Commissioner(A) on behalf of the department.

13. Verification of production, checking of documents from the entry of raw materials up to its clearance as finished goods.

14. Scrutiny ER-land ER-3 returns.

15. Survey work to bring the manufacturers of excisable goods to Central Excise Control.

16. Collection and compilation of Statistical data, preparation of various reports and returns to study the trend of revenue and follow up the reasons of fall of revenue.

17. Enquiry and investigation, collection and dissemination of intelligence.

18. Public and trade relations with special relations with trade and factory management and rendering assistance from the recently introduced Help Centers.

19. Examination and supervision of sealing of packages of goods, cleared for export particularly in DEEC Export, DFRC & Advance Authorisation Scheme Including Export to SEZ as envisaged in Foreign Trade Policy.

20. Recovery of arrears of Revenue and other Government dues by attachment and sale of goods/ property

21. Supervision of work done by the Inspectors.

22. All other works relating to Central Excise Act,1944 and Central Excise Rules,2002
and other Central Excise Rules.

vi) Knowledge of different Acts and Rules made there under related to taxable services namely,

i) The Customs Act, 1962.

ii) The Factories Act, 1948.

iii)The Medical and Toilet Preparation ( Excise Duty) Act.

iv)The Companies Act,1956.

v) The General Clauses Act,1897.

vi) The Khadi and other Handloom Industries development (Additional Excise duty on Cloth) Act,1953.

vii) The Textile Committee Act, 1963. The Additional duties of excise (Goods of Special Importance) Act,1957.

viii) All Cess Acts.

ix) The provisions of levy and collection of Service Tax introduced through Finance Act, 1994.

x)The Indian Contract Act.

xi)The Sale of Goods Act.

xii)Foreign Trade Policy - 2005-2009 (Foreign Trade)

xiii) Foreign Trade (Development & Regulation) Act, 1992.

xiv) SEZ Act, 2005 & subordinate Rules & Regulations.

xv) Foreign Exchange Management Act & Regulations

xvi) Indian Evidence Act.

xvii) Code of Criminal Procedure.

DUTY & NATURE OF JOB PERFORMED BY THE SUPERINTENDENT DURING HIS TENURE IN CUSTOMS FORMATION.

A. The posting in Customs formation may be categorized as the following.

i) Posting in land customs station including the remotest of the remote places.

ii) Posting in Preventive Unit

iii) Posting in Divisional / Hdqrs. offices.

B. Posting in Land Customs Station which can be further classified into two (2) categories.

i) Land Customs Station at Border Point e.g., Nathula Pass, Rothang Pass, etc.

ii) Land Customs Station away from the Border i.e., Ranaghat, T.T.Shed etc.

Nature of job against Sl. No. (A(i))

The job of the Superintendent can be broadly classified in three (3) categories.

a) Assessment - In the layman's language assessment means a process wherein the Superintendent decides if the data provided in the bill of export is correct or not. This is a quasi judicial function of the Superintendent. In cases of exports under some benefit scheme, the Superintendent is responsible to decide the exactitude of the benefit claimed by the exporter. Now this judgment needs not only knowledge of the Customs Act but also he/she is to keep in mind export / import policy, Central Excise Act in addition to all the relevant Acts and procedures. It may so happen that the particular export is in order in view of the Customs Act, Central Excise Act, Exim Policy but banned by Drugs and Cosmetic Act with which the Superintendent does not have any day to day connection. The same is applicable for assessment related import also. The import assessment means the assessment of import duty and decision about the importability of a product. Any dispute between exporter/importer and the Department has to go through the process of natural justice. This involves issuance of Show Cause notice and decision thereof.

b) Cargo Clearance - We must remember that unlike Central Excise, the exercise of import/export clearance is totally a process of Physical clearance. The Superintendent is responsible for matching the description of goods with the description provided in the Bill of export/ Bill of entry, the counting / weighment of the goods and to verify the importablity / exportability of the goods.

c) i) Verification of post export benefit document - A number of post export benefit is allowed by the Government like DEPB, Drawback etc. The Superintendent is required to verify and certify the genuineness of export. It is found that as per the present trend the bulk of export is under different export benefit scheme issued by the Ministry of Commerce. The Superintendent is required to verify each of the export document in effect which means each of such document is required to be verified twice.

ii)As per the CBEC Order, the Central Excise benefit connected with export is required to be verified from export point before allowing the benefit.

FUNCTION OF THE SUPERINTENDENT AT PREVENTIVE UNIT.

I) Collection of Intelligence and information.

II) Working out of the same.

III) Regular Preventive Work.

IV) Documentation of the work.

V) Preparations and issuance of Show cause Notice.

VI) Receiving the seized goods from BSF.

VII) Preparation of Annexure - I (valuation of seized/confiscated goods)

VIII) Disposal of seized / confiscated goods.

IX) Auction of livestock, perishable and non- perishable items.

X) Preparation of reports/return

XI) Court matters.

FUNCTION OF THE SUPERINTENDENT POSTED IN SERVICE TAX

i) Survey to locate provider of taxable service

ii) Provide registration to Service Tax assessees.

iii) Receive the Statutory Returns and scrutinize after calling the record & after classifying the taxable service.

iv) Full responsibility of the Superintendent to verify the credit taken on the duty paid on inputs, Capital goods and input services under Cenvat Scheme and issuing of certificates to the manufacturers and provider of taxable services to facilitate taking of credit. (Explanation appended to Rule 9 (3) of the Cenvat Rules, 2004.

v). Detection and investigation of taxable service on which tax not paid.

vii) Issue of Show cause notice and comments on the reply of the Show cause notice.

viii) Full assistance for adjudication of the same.

ix) Scrutiny of the adjudication orders to see their legality and propriety.

x) Adjudication of cases as quasijudicial authority.

xi) Recommendation for grant of refund including rebate / drawback after verification of export of taxable service.

xii) Full assistance for attachment of property prior to adjudication.

^xiii)Full assistance for attachment/sale to recover arrears and also to realize the government dues from any organization from whom the money is due to the defaulter.

^xiv)Court matters.

xv) Knowledge of different Acts and Rules made thereunder related to taxable services namely,

a. Insurance Act,1938;

b. Aircraft Act,1934;

c. Airports Authority of India Act,1994;

d. Customs Act,1962;

e. Architects Act/1972;

f. Foreign Exchange Management Act,1999;

g. Reserve Bank Act,1934;

h. Banking Regulation Act,1949;

i. Central Boards of Revenue Act,1963;

j. Companies Act,1956;

k. Prasar Bharti (Broad-casting Corporation of India) Act,1990;

1. Cable Television Networks(Regulation) Act,1995;

m. Information Technology Act,2000;

n. Forward Contracts(Regulation) Act,1952;

o. General Insurance Business(Nationalisation) Act,1972;

p. Sale of Goods Act,1930;

q. Motor Vehicles Act,1988;

r. Insurance Regulatory and Development Authority Act,1999;

s. Transfer of Property Act,1882;

t. Indian Ports Act,1908;

u. Major Port Trusts Act,1963;

v. Chartered Accountants Act,1949;

w. Cost and Works Accountants Act,1959;

x. Company Secretaries Act,1980;

y. Securities Contract(Regulation) Act,1956;

z. Securities and Exchange Board of India Act,1992;

aa. Indian Telegraph Act,1985.

Function of the Superintendent posted in SEZ

The Superintendent of Central Excise is one of the officers who is an Authorized Officer as defined in Rule 2(c) of the SEZ Rules, 2005 and are required to discharge the duties of an Authorized Officer and to discharge the function of Specified Officer on authorization. The responsibilities can be estimated from the statement of the Finance Ministry that up to 2010, the benefits of tax exemption is going to be availed of by the units in SEZ, amounting to Rs. 1 lakh crore. The Authorized Officer is responsible to check any misuse and for that matter he is to discharge the following duties:-

i). Assessment of Shipping Bills, Bill of Entry and DTA Bill of Entries

ii). Verification of goods procured from DTA and imported, before use;

iii). Allowing admission into SEZ of the goods procured under claim of export entitlement on the basis of ARE-1 and Bill of Export filed by the supplier, which is assessed by the Authorized Officer;

iv). Endorsement of ARE-1 and /or Bill of Export on admission of goods, which is the proof of export;

v). Allowing of clearance of the goods from the warehouse on the cover of ex-bond Shipping Bill and on the basis of Bill of Entry duly assessed by the Authorized Officer;

vi). Presence of Authorized Officer in destruction of goods outside SEZ ;

vii). Permission to a Unit to transfer goods to an EOU or EHTPU or STPU or BPU or to a bonded warehouse, without payment of duty subject to conditions ;

viii).Receipt of an undertaking for return of goods transferred for quality testing or research and development purposes;

ix). Making entries of all incoming and outgoing goods/ consignments in register;

x). Checking of marks and numbers of all imported goods/consignments;

xi). Work related to export incentives;

Allowing of goods from DTA after verification;

Escort duty, if required;

Attending legal work;

Preparation of show cause notice after investigation;

xvi). Preparation of report and return;

x^vii). Special checking of consignment exported under self-sealing, if needed.

From the above it can be seen that a Superintendent is required to be a perfect Executive Officer, Preventive Officer, Administrative Officer, Assessing Officer, Registration Granting Authority, Examining Authority, Quasi-Judicial Authority, issuing of Summons and recording of Statements Authority (particularly the statements recorded under Summons is a valid evidence in the Court unlike recorded by Police Authority), Controller of Drug Trafficking and Smuggling, Accountant-cum-Chemist and well conversant Advocate. The Superintendent is not only engaged in investigation but also issue show cause notices and adjudicate thereof (unlike Police Organization whose duties are only investigation).

The different Pay Commission (other than 5^th)placed the pay scale of Superintendent of Central Excise at par with the other analogous placed Group-'B' Gazetted Officers in the Central Government. For convenience a table showing the same is furnished :-

RECOMMENDATION OF CPC

SI. No.		Post	I	II	III	IV	v		VI
1		Superintendent Central Excise	275-800	350-900	650-1200	*2000-3500	**6500- 10500		GP 4800 in PB 2 After 4 years GP 5400 in PB2
2		Appraisers, Customs	-do-	-do-	650-1200	*2000- 3500	**6500- 10500		---- do---
3		Superintendent, Pre^y (Cus)	-do-	-do-	650-1200	*2000-3500	'6500- 10500		----- do---
4		I.T.0	-do-	-do-	650-1200	*2000-3500	**6500- 10500 .		-----do---
5		Chief Enft. Officer	275-800	350-900	650-1200	2000-3500	7500-12000		GP 5400 in PB-2
	6	Dy. Cent. Int. Officer, I.B	275-800	350-900	650-1200	2000-3500		8000-13500	GP 5400 in PB-3
	7	UT Civil & Police Service	275-800	350-900	650-1200	2000-3500		8000-13500	GP 4800 in PB 2 After 4 years GP 5400 in PB3
	8	Section Officer Central Secretariate	275-800	350-900	650-1200	2000-3500		'6500- 10500	---- do---
	9	Dy. SP in CBI	275-800	350-900	650-1200	2000-**** 3500		8000-13500	GP 5400 in PB-3

N.B *1. High Power Committee recommended for the pay Scale of Rs.2,500 -4,000/-. **2. High Power Committee recommended for the pay scale of Rs.7,500 - 12,000/-. ***3. Govt. allowed a higher scale of Rs.8,000-13,500/- on completion of 4 years.

****4. Govt. enhanced a higher scale of Rs.2200-4000/- by Notfn. dated 08.02.96 effective from 01.01.1986.

The Ministry of Finance has already stated that in no two organisations, the assigned duties of comparable posts can be totally identical and so is the case with the Executive Officers of CBI, IB, Central Police Organisations, Customs, Income Tax and Central Excise. However, the 3rd, 4th and 5th pay commissions by assigning identical pay scales have established the comparable nature of the level of responsibilities assigned to the Executive Officers of each of the categories mentioned above.

That it is evident from the facts on record that all the pay commissions 1^stto 4^thhave granted/recommended equal pay scales and maintained parity amongst Gr-B Executive Gazetted Officers of Central Excise & Customs, NCB, Income Tax, CBI, IB & Delhi Police Organisation etc. The 1^st,2' and 3^rdCPC recommended equal pay scales to Gr-'B', Executive officers of all the above organizations like CBI, TB, Central Excise, Customs & Service Tax„ I.T etc and Central Govt. accepted the same and implemented it as such. The fourth CPC granted and recommended equal pay scales i.e. a scale of 2000-3500 to Gr-B Gazetted officers of CBI, IB Central Excise w.e.f. 01.01.1986. The Central Govt. accepted the 4^thpay Commission recommendations at the first point and thereafter issued a notification dated 8.2.1996 and enhanced the pay scale of Gr-B Gazetted of CBI i.e. Dy. Superintendent of CBI from already accepted pay scale of 2000 -3500 to 2200-4000 w.e.f. 01.01.1986. The Central Govt. did such enhancement in pay scales of CBI putting on record the rationale that they are Police Organisation. A copy of the Notification dated 8.2.96 is enclosed as Annexure-1.

That the decision of the Central Govt. placing Dy. SP of CBI (i.e. Gr-B Gazetted officer) above Superintendent of Central Excise (i.e. Gr-B officers of Central Excise & Customs) was arbitrary and carried no reason or substance. The traditional parity and balance in pay scales of all Central Govt. Gr-B Gazetted Executive officers ultimately broke by such unwarranted decision of the Central Govt. by Notfn. Dated 8.2.96.

That the Central Govt. acted in this manner on the premises that CBI is analogous to police organisation. No thought was spared for considering the Central Excise & Customs officers as analogous to CBI despite the fact that there are clear guidelines and instructions for the same on record. OM NO. 14017/27/ 75-Estt.(D)(Pt) dated 07.03.1984 issued by the Ministry of Home Affairs outlines the criteria for determining analogous posts. As per such guidelines, Superintendent of Central Excise & Customs is an analogous post to Dy. SP of CBI. In the special Police Establishment (Executive Staff) Recruitment Rules, the department of Central Excise & Customs is considered as a Central Police Organisation. The CBI Recruitment Rules, 1987 considers the Deptt. of Central Excise & Customs as a Central Police Organisation and the Superintendent of Central Excise & Customs is analogous to the post of Dy. SP, CBI. Accordingly, Superintendent of Central Excise & Customs are working in CBI as Dy. SP on deputation basis.

To cite an instance of such case of deputation, the joining of P R Reddy, Supdt. of Central Excise, Hyderabad to CBI as Dy. SP may be mentioned here to bring to the notice of the Hon'ble Commission. He was appointed as Dy. SP by CBI by Notfn. dated 08.03.1991 and his pay was fixed at Rs.2575/- in the scale of pay of Rs.2200-4000. The Notfn. dated 08.03.1991 is marked and enclosed as Annexure-2. with this Memorandum.

In the case of state of Utter Pradesh -Vs.- UP Sales Tax Officers Gr-II. Association in case No. Appeal (Civil) 5866 of 2000 the Honable Supreme Court had ruled. "Officers who were carrying pre-revised scale could not have been discriminated vis-a-vis the officers who also carried the same pre-revised scale of pay". The High Power Committee had already stated that there was no change in the duties and responsibilities of CBI officers with effect from 01.01.1986. Therefore, there was no justification to enhance the pay scale of Executive Officers of CBI etc with effect from 01.01.1986. Further Section 21 of the Central Excise Act and Section 53 of NDPS Act confers powers on Central Excise officers to act as an Officer-inCharge of Police Station.

Keeping such facts in view, Central Excise Inspector & Superintendents have been declared as uniformed officers and Superintendent of Central Excise are given six stars alike Delhi Police. . But without considering such facts and instructions & guidelines available on record, Central Govt. granted higher scale of 2200-4000 to Dy.SP of CBI treating them as Police officer (even though they are not actually the same) and left Superintendent of Central Excise & Customs untouched, ignoring recommendation of 4^thCPC for equal scale to Dy. SP of CBI and Superintendent of Central Excise & Customs.

That it is evident from the position of law as enumerated below that Dy. SP/ Inspr of CBI are not police officers. Section-1 of the Police Act, 1861 defines "Police" as including all persons enrolled under the Act. Police Act, 1861 does not incorporate CBI/ IB organizations in it. So strictly speaking CBI/ IB cannot be police organisation and hence, CBIRB officers cannot be police officers in the eyes of law. Hon'ble CAT, Jabalpur in 0.A No. 45/2000 has held this view that the CBI/ TB do not come within the purview of Police Orgainstion. But on the contrary, as narrated above, Inspector & Superintendent of Central Excise and Customs are police officers as invested by Section 21 of Central Excise Act, 1944, Section 53 of NDPS Act, and CBI Recruitment Rules. But nevertheless Central Govt. granted higher pay scale to DSP of CBI, treating them as police officer than the pay scale of Superintendent of Central Excise who is actually Police officer in the sense. Further Central Govt. disregarded the recommendation of the 4^thCPC for granting equal pay scale to Dy. SP of CBI & Superintendent of Central Excise & Customs. Copies of the judgements cited above are marked and enclosed together as Annexure -3 with this Memorandum.

That as already narrated above, the post of Superintendent/ Inspector of Central Excise & Customs is analogous and equivalent to the post of DSP/ Inspr. of CBI/ IB respectively. Hon'ble CAT, Jabalpur by order dated 24,02,95 referred the matter of disparity in pay scale to 5^thCPC for placing Inspectors of Central Excise on pay scale of Rs.2000-3200 at par with Inspectors of CBI/ IB after expert evaluation. A copy of the order- dated 24.02.95 passed in 0.A NO. 541/1994 is marked and enclosed as Annexure-4.

That the 5^thCPC considered the issue and recommended pay scale for Inspector of Central Excise & Customs at par with Inspector CBI/ IB. However, it held the pre-revised scale for CBI/ IB to be considered as 1640-2900 for Inspectors. The recommendation of 5th CPC was not accepted by the Govt. and they further fixed the scale of Inspector of CBI at Rs.6500-10,500 against replacement scale of 2000-3200 ignoring the recommendation of pay commission to fix pay of 5500 -9,000 against replacement scale of 1640-2900 which was awarded to Inspector of Central Excise. The action of the Govt. showed hostile discrimination against the Central Excise & Customs Department.

That followed by persistent demands of the Central Excise Executive Officers, the Finance Ministry constituted a High Power Committee to remove the anomaly. Chairman and Member (P&V) of CBEC/CBDT were the members of High Power Committee. After several deliberations and discussions with federating units, the High Power Committee submitted its report finally on 03.08.1998. It recommended the issues in favour of Inspector/Superintendent cadre. It is established and in fact followed in practice as per the Circular of the Department of Per & Trg. OM No. 1/ 7/ 87-JCM dated 15.04.88 that when no agreement is reached on arbitral issue, the Committee of Council shall further examine the same and in case there is still disagreement, the matter will be referred to arbitration. In the present case, High Power Committee decided it after taking into all the factors presented before them. Copy of the High Power Committee report is marked as Annexure-5.

That in a D.O. letter No. DOF-A-26011/5194-Ad.II-A(PC) dt. 27.10.95 of Joint Secy. (Admn), Ministry of Fin. (Dept. of Revenue) addressed to the Member-Secy, V Pay Commission, it was placed on record that duties and responsibilities performed by Inspector of Central Excise & Customs are much more arduous and hazardous than that of the Inspectors of Delhi Police, CBI etc. and singularly recommended pay scale and perquisites to Inspectors of Central Excise & Customs etc. equal to that of Delhi Police, CBI etc. Copy of the letter is in the Annexure-6.

That despite judicial pronouncements made by Horible CAT, Jabalpur, findings of High Power Committee in arbitration and conclusion of the Ministry of Finance in their letter dated 27.10.95 to V Commission conceding the bare fact that the duties & responsibilities of Inspector of Central Excise & Customs etc. are more arduous & hazardous in nature than that of Inspector of CBI/ IB/ Delhi Police, no action for replacement scale of 2000-3200 or corresponding revision scale of 6500-10,500 was awarded to Inspector of Central Excise & Customs, Narcotics etc. This necessitated appealing to CAT, Jabalpur for redressal in OA No. 45 of 2000 and Hon'ble CAT, Jabalpur in order dated 22.03.2002 passed order in favour of the applicant and directed Govt. to take final decision within three month's time. Copy of the order of the Hon'ble CAT is already enclosed and marked as Annexure-3.

That in this backdrop, the Ministry of Finance finally by order F. No. A26017/ 65/ 2003-AD-II-A(Pt.) dated 22.04.2004 fixed the pay scale of Inspector of Central Excise, Preventive Officers, Examiners etc. on a replacement scale of Rs.2000-3500 and corresponding revised scale of 6500-10500 effective from 21.04.2004. Ministry also awarded replacement scale of 2500-4000 as revised scale of 7500-12000 to Superintendent of Central Excise & Customs etc. in the said order effective from 21.04.2004 in the line of the recommendation dated 3.8.96 of the High Power Committee. Copy of the order-dated 11.05.2004 is enclosed as Annexure-7.

That since the Govt. has granted the pay scale of Rs.6500-10500 i.e. the scale of Inspector of CBI to Inspector of Central Excise & Customs, it is incumbent on the part of the Govt. to grant the pay scale of Dy. SP, CBI i.e. 8000-13500 to the Superintendent of Central Excise & Customs in view of the fact that both Inspector, Central Excise & Inspector of CBI are the feeder cadres for promotion to the post of Superintendent, Central Excise & Dy. Supdt. of CBI respectively.

That the High Power Committee report dated 03.08.1998 has unequivocally held the post of Supdt, Central Excise & Customs as analogous and comparable to the post of Dy. SP., CBI and accordingly they had recommended pay scale of Rs.2500-4000 (pre-revised scale) to the Superintendent of Central Excise & Customs.

That the High Power Committee came to the conclusion that the post of Supdt., Central Excise is comparable with the post of Dy. SP in CBI and Dy. Intelligence Officer in IB but a lower scale of Rs.7,500- 12,000/- was recommended for the Superintendent, Central Excise and Customs on the ground that 'Customs Appraisers' are recruited through the same Civil Service Examination through which Group-A IC & CES officers are recruited and giving pay scale of Rs.8,000- 13,500/- to them along with the Supdt., Central Excise and Customs will create difficulty from the operational point of view and in the matter of fitting them into the overall structure of the department. The provisions of direct recruitment of Appraisers in the department of Central Excise & Customs have been abolished in the year 2002 and intimated under C. No. 1(10)(4)4/Law/ BBSR-I/ 2002/8193A dated 17.04.03 i.e. after submission of High Power Committee report. This is further submitted here that as the direct recruitment of Appraiser has been abolished, there is no difficulty in retaining the parity or giving pay scale of Rs.8,000-13,500/- to the Supdt. of Central Excise & Customs and the overall spirit of the High Power Committee is also to retain such parity.

That in spite of (a) recommendation of High Power Committee for enhancement of pay scale of Superintendent of Central Excise, and(b) the decisions of the Hon'ble CAT, Jabalpur Bench in OA No. 45 of 2000, the Central Government did not enhance the pay scale of Superintendent of Central Excise with effect from 01.01.1996 at par with Dy. SP of CBI. Against such inactio of Central Govt., Certain Superintendents of Central Excise had filed OAbefore the Hon'ble CAT, Cuttack bench for
enhancement of pay scale of Inspector of Central Excise and Superintendent of Central Excise. While the matter was sub-judice and pending before the Hon'ble Tribunal for consideration, the Central Govt. neither taking permission from the Hon'ble Tribunal nor intimating them had enhanced the pay scale of Superintendent of Central Excise from - 10,500/- to Rs.7,500 - 12,000/- and the Pay scale of Inspector Central Excise from Rs.5,500- to 9,000/- to Rs.6,500 - 10,500/- with effect from 21.04.2004 under F. No. 6/37/ 98- IC dated 21.04.2004.After enhancement of such pay scale the Ministry of Finance,
Department of Expenditure Govt. of India vide IC.U.O. No. 6/37/98-IC dated 9.8.2004 intimated the Central Board of Excise and Customs, New Delhi to convey the counsel of the said Original Applications about the following reasons, which were taken into account for enhancement of pay scale of Inspector/Superintendent, Central Excise w.e.f. 21.04.2004 while the 0.A is pending for decision before the Hon'ble' Tribunal.

"(i) Orders granting higher pay scales to Inspectors & Income Tax Officers(IT0s)/equivalent ranks in CBDT & CBEC were issued on 21.04.2004 after the same were approved by the Finance Minister on a proposal received from Department of Revenue regarding the posts of CBDT. A decision to extend similar dispensation to analogous posts in CBEC was taken as a distinct relativity had existed between these posts in CBDT and CBEC, which needed to be maintained. The higher pay scales had to be given because earlier, Inspectors of CBI/ IB were extended the higher scale of Rs.2000-3200 (Revised: Rs.6500-10500) as against the existing pay scale of Rs.1640-2900 (Revised: Rs.5500-9000) thus disrupting the established parity between Inspectors of CBI/ IB and those of Central Excise & Customs and Income Tax which had existed till the time of 4th Pay Commission when all these posts existed in the pay scale of Rs.1640-2900 (Revised: Rs.5500 -9000). Thereafter the issue was considered by the fifth CPC who also had recommended that Inspectors of Income Tax, Central Excise and Customs as well as those of CBI and IB in the scale should be placed in the scale of Rs.1640-2900 i.e. Rs.5500-9000. This was to be done by reduction in the pay scale of Inspectors in CBI and TB from existing Rs.6500-10500 to that of Rs.5500-9000. The Fifth CPC had therefore established the clear principle that the earlier parity in pay scales between the Inspectors of Income Tax, Central Excise and Customs and Inspectors of CBI and IB was also endorsed by the Fourth CPC had to be maintained especially when all these posts were not comparable with the post of Inspectors of Police in Delhi who were allocated the higher scale of Rs.6500-10500 by the Fifth CPC,

(ii) The pay scale of Inspectors in CBI and IB however could not be reduced from the scale of Rs.6500-10500 to Rs.5500-9000. Hence, in accordance with recommendations of Fifth CPC, the scale of Inspectors of Income Tax, Central Excise and Customs/analogous posts had to be brought on par with that of Inspectors of CBI/TB. A High Level Committee consisting of Chairman and Members (Personnel) of CBDT and CBEC had also looked into this issue and recommended higher pay scale for these posts in CBDT and CBEC. The issue had also been agitated by All India Federation of Central Excise Executive Officers before Jabalpur Bench of CAT vide OA No. 45 of 2000 wherein the Tribunal had observed as under:-

" In the result, we find the action of the Government to deny the applicants pay scale at par with those of Inspectors of CBI/IB as violative of Article 14 and 16 of the Constitution of India. However, we refrain from ordering accord of any scale to the applicants and in this view of the matter the OA is disposed of with the direction to the respondents to reconsider the claim of the applicants for being accorded the pay scale at par with the Inspectors of CBI and IB having regard to the observations made above by us and to take a final decision by passing a detailed and speaking order, within a period of three months from the date of receipt of a copy of this order. No costs."

iii) Department of Legal Affairs while observing that no infirmity existed in the judgement had advised, "It is a recorded fact that similarity of the pay scale was recommended by HPC Committee also. But the same could not find favour of consideration by the Government, reasons best known to it. When this fact is admitted that the nature of duties of the Inspectors of Excise are arduous comparatively those of CBI and IB, there appears no reasons as to why they should not be provided the same scale and it appears that it may, invoke Article 14 and 16 of the Constitution." (Articles 14 and 16 of the Constitution deal with 'Equality before law' and 'Equality of opportunity in matters of public employment)

The copy of IC UO No. 6/37/98-IC dated 09.08.2004 is annexed hereto and marked Annexure-8. It transpired from the said UO dated 09.08.2004 that the Government allowed the pay scale of Inspectors of CBI i.e. Rs.6,500 - 10,500 to the Inspectors of Central Excise. While the Inspector of CBI is the feeder cadre for the promotion to the post of Dy.SP, CBI, the Inspector of Central Excise is the feeder cadre for promotion to the post of Superintendent, Central Excise. Therefore, it was required on the part of the Government to allow the pay scale of Dy.SP, CBI i.e. Rs.8,000 - 13,500 to the grade of Superintendent of Central Excise in view of the decision taken by the Government to maintain the parity in between the pay scales of executive officers of Department of Revenue and CBI. But since the Government allowed a lower pay scale i.e. Rs.7,500-12,000 to the grade of Superintendent, Central Excise and there was no discussion in the said UO dated 09.08.2004 about the reason to allow such lower pay scale to the grade of Superintendent, Central Excise, it transpired from the same that the Government could not allow the higher pay scale due to oversight.

That direct recruitment of Appraisers of Customs has since been abolished vide Union Cabinet order F. No. A-568(1) OMS/ 2001 dated 03.08.2001. So the entry-level post of Appraisers is not coming in the way any more for fixation of pay scale of Supdt. Central Excise & Customs at 8000-13500 equal to the pay of Dy SP of CBI with effect from 01.01.96.

That the duties and responsibilities of the Supdt. Cadre in Central Excise, Customs, Narcotics Bureau, DGCEI, DRI etc. are much more hazardous and arduous in nature than that of the duties and responsibilities of Dy. SP, CBI. Supdt. Cadre of Central Excise and allied formations as narrated above, are uniformed officers with six stars and carry fire arms in natural duties like dealing with smugglers, drug traffickers etc. Finance Ministry has already granted replacement scales of 2000 -3500 to Inspector cadre of Central Excise and other allied wings the corresponding pay of which is 6500-10,500. The cadre of Superintendent in Central Excise & allied wings be considered in same footing in view of judicial pronouncements dated 22.03.2002 of CAT, Jabalpur in OA 45/2000, the findings dated 03.08.98 of High Power Committee and letter dated 27.10.95 of the Ministry Finance, wherein all have held the cadres of Central Excise & Customs as analogous & comparable to the cadres of CBI/ IB. Furthermore, Inspector, Central Excise is a feeder cadre to the Supdt. of Central Excise in the same manner as Inspector of CBI a feeder cadre to the Dy. SP, CBI. When pay scale of Inspector of CBI has been made applicable to the Inspector of Central Excise keeping in view the findings of High Power Committee, it is a gross injustice for not awarding the pay scale of the Dy. SP of CBI to the Supdt. of Central Excise in the line of the recommendation of the said High Power Committee dated 03.08.1998.

It is thus established beyond any degree of doubt that Superintendent, Central Excise & other allied wings of CBEC are discharging duties & responsibilities not less than the duties & responsibilities of the Dy. SP, CBI and hence have vested right to equal pay for equal work under Article 14 and 16 of the Constitution of India.

That the Central Govt. had awarded the pay scale of 7500-12500 with effect of 21.04.2014, the Superintendent of Central Excise cadre of CBEC. This corresponds to replacement for pre- revised scale of 2500-4000, which the High Power Committee awarded and was accepted by the Govt. The pay scale of 8000-13500 given to the Dy. SP, CBI corresponds to the replacement scale of Rs.2200-4000/-. This indicates that the higher replacement scale has been given lower revised scale and lower replacement scale has been given higher scale. This is discriminatory and prejudicial and defies logic. The replacement scale of 2500 -4000
given to Superintendent, Central Excise was initial or starting scale of 2500.The replacement scale of 2200-4000 of Dy. SP, CBI has been given 8000 -13500. That means the starting scale of 2200 has been given 8000. So, starting scale of 2500 should be placed in higher scale with a starting higher than 8000. In case of Dy Central Intelligence Officer of IB whose pre revised scale was Rs 2000-3500/-, a higher revised scale of Rs 8000-13500/- has been granted to this post whereas in case of Superintendent of Central Excise whose pre revised scale was Rs 2500-4000/- a lower revised scale of Rs 7500-12000/- has been granted and that too w.e.f 21.04.2004.

In this Connection it is pointed out that in respect of Group-'B' Gazetted Officers in general, who are feeders to the Organized Group-'A' Services, the Prakash Tandon Committee prior to the 5^thCentral Pay Commission, had clearly recommended to remove the distinction between the pay scales of Group-'B' officers and entry grade Group -'A' Officers. The Gupta-Narayan Committee, which was setup in
pursuance of recommendation of the Prakash Tandon Committee, had clearly recommended that all the Group-'B' Gazetted Officers in the Central Government including Audit and Accounts officers be placed in the uniform scales of Rs. 2200-4000/ - Prior to 4^thCentral Pay Commission, the pay scale of the entry grade officers of the State Government which were equivalent to the Group-'B' Gazetted Officers like Superintendent of Central Excise, Income Tax Officer, Audit and Accounts Officer etc. were either equal or less. But after the 4^thCPC, the entry grade pay scales in most of the states has been made at par with the entry grade scale of the Organized Group- 'A' Services of the Central Government. In case of UPPSC, the Class-II Gazetted Officers are given the scale of Rs. 8000-13,500/- which is the supervisory cadre of the officers bearing the pay scale of Rs. 6500-10,500/-. In case of CBI, the pay scale was enhanced to Rs. 2200- 4000/- and consequently Rs. 8000-13500/- on the basis of the above logic since they are required to inter act with the State Police Official. On the same analogy, the 5^thCPC also recommended corresponding pay scales of Rs. 2200-4400/- i.e., Rs. 8000-13500/- to the entry grade officer of DANIPS and DANICS. Though the Government did not accept the said recommendation and setup a fast track committee. On the basis of the recommendation of the fast track committee they have been kept in the corresponding scale of Rs. 2000- 3500/ - i.e., Rs. 6500-10500/- but would automatically be placed in the non functional selection scale of Rs. 8000-13500/- after completion of 4 years. Moreover, the said NFSG scale of Rs. 8000-13,500/- would not be taken into consideration in the matter of granting benefit under ACP Scheme. While recommending the pay scale of Rs. 8000-13500/-, the Pay Commission should consider the financial loss already suffered due to the non- implementation of the pay scale w.e.f. 01/01/1996 and recommend suitable remedies so that the financial loss already suffered is adjusted at the time of fixation as a special case.

Another reason cited for not granting the scale of Rs. 8000 - 13,500/- to the Superintendent of Central Excise, though granted to other analogous posts by the 5^thCPC, was that the same would disturb the horizontal relativity since the Superintendent is feeder cadre to the organized Group 'A' Service bearing pay scale of Rs. 8,000-13,500/-. Therefore, if that be the reason for not granting the pay scale of Rs. 8,000-13,500/-, then in that case a de-linked service for the officers joining in the scale of Inspectors up to the grade of Deputy Commissioner be created raising the interfacing stage from the present level of Assistant Commissioner to Joint Commissioner. The Superintendent of Central Excise, on promotion should move up to Deputy Commissioner. The post of Assistant Commissioner should only be earmarked for the direct Group-'A' Officers recruited through UPSC. These systems are in vogue in CSS, DANIPS, DANICS, State Services where officers belonging to the cadres mentioned move parallel along with the officers of All India Service / Organized Group -'A' Service up to a certain level and then interface at a much higher grade.

The main jobs of the post of Superintendent of Central Excise, Customs and Service Tax are to prevent evasion of duty and prevent smuggling. Both the tax evaders in Central Excise and Service Tax side and smugglers of Customs / Narcotics side are equipped with well organised gangster and different types of lethal weapons. As a result of this, there is every possibility of loss of life and/or meeting with severe injuries to the part of officers deployed in action. At the cost of repetition it is to be stated that the working conditions and risk involved in a job have always been the main criteria for considering the fixation of remunerations of the workers all over the world. Therefore the post of Superintendent of Central Excise is entitled to get more pay than its counterparts of other departments such as Dy SP/CBI etc.

CENGO INDIA ( DEDICATED TO ALL CENTRAL EXCISE, SERVICE TAX AND CUSTOMS GAZETTED EXECUTIVE OFFICERS)

Monday, 9 June 2014

DRAFT MEMORANDUM FOR SUBMISSION BEFORE 7TH CPC---PART-I

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