Indirect tax arrear target pegged at Rs 3000 cr

The finance ministry has decided to fix the arrear collection target for indirect taxes at the same level as last year at around Rs 3,000 crore.

"Though the recoverable arrears was expected to be lower than last year, the ministry had decided to fix the arrear target at last year's level," finance ministry officials said, adding, the arrear collection target for excise would be higher than that of customs.

The government had last year mopped up Rs 2,642 crore by way of recovery of arrears, against a target of Rs 3,000 crore. Of the said amount, Rs 1,799 crore was collected from cases related to central excise, while RS 843 crore was mopped up from customs.

According to the data available with the finance ministry, the total amount involved in the cases pending before various courts and tribunals in the last three years was Rs 21,413 crore.

Officials said efforts would continue to be focussed on the earlier settlement of court cases and vacating of stay orders. The finance ministry had fixed an arrear collection target of Rs 10,000 crore for direct taxes.

Officials said that overall indirect tax collection for the period up to August had increased by over 19 per cent to Rs 70,988 crore, against Rs 59,488 crore during the corresponding period of the previous year.

The overall indirect collection up to August 2005 was also marginally higher than the moving target of Rs 69,337 crore. A significant feature was that excise collections appeared to be picking up, registering a growth of over 9 per cent at Rs 39,015 crore, compared with Rs 35,532 crore during April-August last year.

Officials said efforts were on to improve excise audit through the launch of a rigorous training campaign to improve the financial literacy skills of departmental auditors.

"Discussions were on with the Institute of Chartered Accountants of India and the Cost Works Accountants of India (ICWAI) for the preparation of a panel of their members, who could be used as faculty," officials added.

As an interim measure until the skills of the departmental auditors were upgraded, the services of chartered accountants and cost accountants was decided to be utilised, to assist during the desk review state of audit in complicated cases.

Officials also the appointment of CAs for the said purpose would be made by chief commissioners on a case-to-case basis from a panel to be provided by the ICAI and the ICWAI.

The structure of remuneration for this work would be submitted to the CBEC soon for approval.