Government Sets Up Panel To Look Into Jewellers' Demand

The government has constituted a panel under former chief economic advisor Ashok Lahri to look into demand of jewellers who are protesting against imposition of 1 per cent excise duty on non-silver jewellery items.

The panel, which has been asked to submit its report in 60 days, will look into issues related to compliance procedure for the excise duty, including records to be maintained, forms to be filled, operating procedures and other relevant issues.

The sub-committee of a high level committee constituted earlier to suggest steps to sort out taxation problems being faced by trade and industry will have three representatives of the trade.

"All associations will be given an opportunity to submit representation before the Sub-Committee in writing and the all India associations to state their case in person," the Finance Ministry said in a statement today.

Even as major associations of the jewellery industry have called off their stir following assurance by the government to look into their concerns, a section of jewellers in the country continue to protest against the budget proposals.

Late Saturday, major associations, including All India Gems and Jewellery Trade Federation (GJF), All India Bullion and Jewellers Association (IBJA) and Gems Jewellery Export Promotion Council (GJEPC) called off strike after government's assurance that there would be no 'Inspector Raj'.

The Finance Ministry further said till the recommendations of the sub-committee are finalised there will be no arrest or criminal prosecution of any jeweller. There will also be no search and seizure of stocks by any central government officials.

Further, the Central Excise Officers will not visit the manufacturing units/ shops/ place of business/residence of the jewellers; and all payments of Central Excise duty will be based on first sale invoice value till committee's recommendations are finalised.

"The Central Excise authorities will not challenge the valuation given in the invoice provided the caratage / purity and weight of the gold/silver with precious stones; and carats of diamond/precious stones are mentioned on the invoice," the Ministry said.

Exporters will be allowed to export on self-declaration and submission of LUT to customs without the need to get LUT ratified by central excise, it said, adding "the prevailing system will continue".

Regarding composition of the sub-committee, the Ministry said there will be three representatives of the trade (to be decided by the Government); one legal expert; and officer concerned from the Ministry of Commerce and Industry. High level officials from the Central Excise Department will also be nominated by Central Board of Excise and Customs (CBEC).

In the Budget, the Central Excise duty at the rate of one per cent (without input tax credit) and 12.5 per cent (with input tax credit) has been imposed on all articles of jewellery (except for silver jewellery, other than those studded with diamond, ruby, emerald or sapphire).