THE CENTRAL EXCISE ACT, 1944 

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ARRANGEMENT OF SECTION 

_____________ 

CHAPTER I 

SECTIONS. 

1.  Short title, extent and commencement. 
2.  Definitions. 

2A. References of certain expressions. 

CHAPTER II 

LEVY AND COLLECTION OF DUTY 

3.  Duty specified in the Fourth Schedule to be levied. 

3A. Power of Central Government to charge excise duty on the basis of capacity of production in respect 

of notified goods. 

3B. Emergency power of Central Government to increase duty of excise. 

3C. Power of Central Government to amend Fourth Schedule. 

4.  Valuation of excisable goods for purposes of charging of duty of excise. 

Illustration 

4A. Valuation of excisable goods with reference to retail sale price. 

5.  Remission of duty on goods found deficient in quantity. 

5A. Power to grant exemption from duty of excise. 

5B. Non-reversal of CENVAT credit. 

6.  Registration of certain persons. 
7.  [Omitted.]. 
8.  Restriction on possession of goods specified in the Second Schedule . 
9.  Offences and penalties. 

9A. Certain offences to be non-cognizable. 

9AA. Offences by companies. 

9B. Power of Court to publish name, place of business, etc., of persons convicted under the Act. 

9C. Presumption of culpable mental state. 

9D. Relevancy of statements under certain circumstances. 

9E.  Application  of  Section  562  of  the  Code  of  Criminal  Procedure,  1898,  and  of  the  Probation  of 

Offenders Act, 1958. 

10. Power of Courts to order forfeiture. 

11. Recovery of sums due to Government. 

11A. Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded. 

11AA. Interest on delayed payment of duty. 

11AC. Penalty for short-levy or non-levy of duty in certain cases. 

11B. Claim for refund of duty and interest, if any, paid on such duty. 

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SECTIONS. 

11BB. Interest on delayed refunds. 

11C. Power not to recover duty of excise not levied or short-levied as a result of general practice. 

11D. Duties of excise collected from the buyer to be deposited with the Central Government. 

11DD. Interest on the amounts collected in excess of the duty. 

11DDA. Provisional attachment to protect revenue in certain cases. 

11E. Liability under Act to be first charge. 

12. Application of the provisions of Act 52 of 1962 to Central Excise Duties. 

CHAPTER II-A 

INDICATING AMOUNT OF DUTY IN THE PRICE OF GOODS, ETC., FOR PURPOSE OF 

REFUND AND CREDITING CERTAIN AMOUNTS TO THE FUND 

12A. Price of goods to indicate the amount of duty paid thereon. 

12B. Presumption that the incidence of duty has been passed on to the buyer. 

12C. Consumer Welfare Fund. 

12D. Utilisation of the Fund. 

POWERS AND DUTIES OF OFFICERS AND LANDHOLDERS 

CHAPTER III 

12E. Powers of Central Excise Officers. 

12F. Power of search and seizure. 

13. Power to arrest. 

14. Power to summon persons to give evidence and produce documents in inquiries under this Act. 

14A. Special audit in certain cases. 

14AA. Special audit in cases where credit of duty availed or utilised is not within the normal limits, 

etc. 

15. Officers required to assist Central Excise Officers. 

15A. Obligation to furnish information return. 
15B. Penalty for failure to furnish information return. 
16.  [Omitted.].  
17.  [Omitted.].  
18.  Searches and arrests how to be made. 
19.  Disposal of persons arrested. 

20. Procedure to be followed by officer-in-charge of police station. 

21. Inquiry how to be  made by Central Excise Officers against arrested persons forwarded to them 

under Section 19. 

22. Vexatious search, seizure, etc., by Central Excise Officer. 

23. Failure of Central Excise Officer in duty. 

CHAPTER III-A 

ADVANCE RULINGS 

23A. Definitions. 

23B. [Omitted.]. 

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SECTIONS. 

23C. Application for advance ruling. 

23D. Procedure on receipt of application. 

23E. Applicability of advance ruling. 

23F. Advance ruling to be void in certain circumstances. 

23G. Powers of Authority. 

23H. Procedure of Authority. 

23I. Transitional provision. 

CHAPTER IV 

TRANSPORT BY SEA 

24. [Omitted.]. 

25. [Omitted.]. 

26. [Omitted.]. 

27. [Omitted.]. 

28. [Omitted.]. 

29. [Omitted.].  

30. [Omitted.].  

31. Definitions. 

CHAPTER V 

SETTLEMENT OF CASES 

32. Customs and Central Excise Settlement Commission. 

32A. Jurisdiction and powers of Settlement Commission. 

32B. Vice-Chairman to act as Chairman or to discharge his functions in certain circumstances. 

32C. Power of Chairman to transfer cases from one Bench to another. 

32D. Decision to be by majority. 

32E. Application for settlement of cases. 

32F. Procedure on receipt of an application under Section 32-E. 

32G. Power of Settlement Commission to order provisional attachment to protect revenue. 

32H. Power of Settlement Commission to reopen completed proceedings. 

32I. Powers and procedure of Settlement Commission. 

32J. Inspection, etc., of reports. 

32K. Power of Settlement Commission to grant immunity from prosecution and penalty. 

32L. Power of Settlement Commission to send a case back to the Central Excise Officer. 

32M. Order of settlement to be conclusive. 

32N. Recovery of sums due under order of settlement. 

32O. Bar on subsequent application for settlement in certain cases 

32P. Proceedings before Settlement Commission to be judicial proceedings. 

32PA. [Omitted.]. 

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SECTIONS. 

CHAPTER VI 
ADJUDICATION OF CONFISCATIONS AND PENALTIES 

33. Power of adjudication. 
33A. Adjudication procedure. 
34. Option to pay fine in lieu of confiscation. 
34A. Confiscation or penalty not to interfere with other punishments. 

CHAPTER VIA 
APPEALS 

35. Appeals to Commissioner (Appeals). 
35A. Procedure in appeal. 
35B. Appeals to the Appellate Tribunal. 
35C. Orders of Appellate Tribunal. 
35D. Procedure of Appellate Tribunal. 
35E. Powers of Committee of Principal Chief Commissioner of Central Excise or Chief Commissioners 
of Central Excise or Principal Commissioner of Central Excise or Commissioners of Central Excise 
to pass certain orders.  

35EA. Powers of revision of Board or Principal Commissioner of Central Excise or Commissioner of 

Central Excise in certain cases. 
35EE. Revision by Central Government. 
35F. Deposit of certain percentage of duty demanded or penalty imposed before filing appeal. 
35FF. Interest on delayed refund of amount deposited under Section 35-F. 
35G. [Omitted.].  
35H. [Omitted.].  
35I. [Omitted.].  
35J. [Omitted.].  
35K. Decision of High Court or Supreme Court on the case stated. 
35L. Appeal to Supreme Court. 
35M. Hearing before Supreme Court. 
35N. Sums due to be paid notwithstanding reference, etc. 
35O. Exclusion of time taken for copy. 
35P. Transfer of certain pending proceedings and transitional provisions. 
35Q. Appearance by authorised representative. 
35R. Appeal not to be filed in certain cases. 
36. Definitions. 

CHAPTER VI-B 
PRESUMPTION AS TO DOCUMENTS 

36A. Presumption as to documents in certain cases. 
36B. Admissibility of microfilms, facsimile copies of documents and computer printouts as documents 

and as evidence. 

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SECTIONS. 

CHAPTER VII 
SUPPLEMENTAL PROVISIONS 

37. Power of Central Government to make rules. 

37A. Delegation of powers. 

37B. Instructions to Central Excise Officers. 

37C. Service of decisions, orders, summons, etc. 

37D. Rounding off of duty, etc. 

37E. Publication of information respecting persons in certain cases. 

38. Publication of rules and notifications and laying of rules before Parliament. 

38A. Effect of amendments, etc. of rules, notifications or orders. 

38B. Savings of references to Chapter, Heading, Sub-heading and tariff item in Central Excise Tariff 

Act, 1985. 

39. Repeal of enactments. 

40. Protection of action taken under the Act. 

THE FIRST SCHEDULE 

THE SECOND SCHEDULE 

THE THIRD SCHEDULE 

THE FOURTH SCHEDULE 

——— 

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*THE CENTRAL EXCISE ACT, 19441 

ACT NO. 1 OF 1944 

An Act to consolidate and amend the law relating to central duties of excise 2[* * *] 

Whereas it is expedient to consolidate and amend the law relating to central duties of excise on goods 

manufactured or produced in  3[ 4[certain parts] of India] 5[* * *]; 

[24th February, 1944.] 

It is hereby enacted as follows:— 

CHAPTER I 

1. Short title, extent and commencement.— 6[(1) This Act may be called the Central Excise Act, 

1944.] 

(2) It extends to the whole of India  7[* * *]. 

(3) It shall come into force on such date8 as the Central Government may, by notification in the Official 

Gazette, appoint in this behalf. 

2. Definitions.— In this Act, unless there is anything repugnant in the subject or context,— 

9[(a) “adjudicating authority” means any authority competent to pass any order or decision under 
this Act, but does not include the Central Board of Excise and Customs constituted under the Central 
Boards of Revenue Act, 1963 (54 of 1963) 10[Commissioner of Central Excise (Appeals) or Appellate 
Tribunal;] 

1. See Gazette of India, 1943, Pt. V, p. 243 for Statement of Objects and Reason sand see Gazette of India, 1944, Pt. V. p. 12 for Report of the 
Select Committee. 
This Act has been applied to— 

(1) all the partially excluded areas in the State of Orissa by Orissa Government Notification No. 1226-II-C-13/44-Com., dated  21st March, 

1944; 

(2) Darjeeling District with effect from 28th February, 1944, see Bengal Government Notification No. 342-R, dated 22nd March, 1944; 
(3) excluded areas in the State of Madras (with modifications), see Madras Government Notification No. 37, Fort St. George Gazette, Pt. I, p. 

281, dated 11th April, 1944; 

(4) partially excluded areas in the State of Madras with effect from 28th February, 1944, see Madras Government Notification No. 745-Public-

Political, dated 4th March, 1944. 

This Act has been extended to Goa, Daman and Diu by Reg. 12 of 1962, section 3 and Schedule; to Dadra and Nagar Haveli by Reg. 6 of 

1963, section 2 and Schedule I and to the whole of the Union territory of Lakshadweep by Reg. 8 of 1965, section 3 and Schedule. 
2. The words “and to Salt” omitted by Act 33 of 1996, s. 69 (w.e.f. 28-9-1996). 
3. Subs. by the A.O. 1948, for “British India”. 
4. Subs. by the A.O. 1950, for “the Provinces”.  
5. The words “and to Salt” omitted by Act 33 of 1996, s. 70 (w.e.f. 28-9-1996). 
6. Subs. by ibid, s. 71, for sub-section (1), (w.e.f. 28-9-1996). 
7. The words “except the State of Jammu and Kashmir” omitted by Act 41 of 1954, s. 2 and Sch, (w.e.f. 8-10-1954). 
8. 28th February, 1944, see Notification No. III-D, dated 26th February, 1944, Gazette of India, Extra., 1994, p. 293. 
9. Ins. by Act 44 of 1980, s. 50 and Sch. V, Part II-1 (w.e.f. 11-10-1982). 
10. Subs. by Act 22 of 1995, s. 70, for “Collector of Central Excise (Appeals)”. 
* The Central Excise Act, 1944 (except as respects goods included in entry 84 of the Union list of the Seventh Schedule to the (Constitution) 
repealed by the Central Goods and Services Tax Act, 2017 (12 of 2017), sec. 174, (w.e.f. 1-7-2017). 

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(aa)  “Appellate  Tribunal”  means  the  Customs,  Excise  and   1[Service  Tax]  Appellate  Tribunal 

constituted under Section 129 of the Customs Act, 1962 (52 of 1962);] 

2[(aaa)] “broker” or “commission agent” means a person who in the ordinary course of business 

makes contracts for the sale or purchase of excisable goods for others; 

3[(b) “Central Excise Officer” means the 4[Principal Chief Commissioner of Central Excise, Chief 
Commissioner of Central Excise, Principal Commissioner of Central Excise], Commissioner of Central 
Excise  (Appeals),  Additional  Commissioner  of  Central  Excise, 5[Joint  Commissioner  of  Central 
Excise,] 6[Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise] or 
any other officer of the Central Excise Department, or any person (including an officer of the State 
Government)  invested  by  the  Central  Board  of  Excise  and  Customs  constituted  under  the  Central 
Boards of Revenue Act, 1963 (54 of 1963) with any of the powers of a Central Excise Officer under 
this Act;] 

(c) “curing” includes wilting, drying, fermenting and any process for rendering an unmanufactured 

product fit for marketing or manufacture; 

(d) “excisable goods” means goods specified in  7[the Fourth Schedule] as being subject to a duty 

of excise8 and includes salt; 

9[Explanation.— For the purposes of this clause, “goods” includes any article, material or substance 
which is capable of being bought and sold for a consideration and such goods shall be deemed to be 
marketable.] 

(e) “factory” means any premises, including the precincts thereof, wherein or in any part of which 
excisable  goods 10[*  *  *]  are  manufactured,  or  wherein  or  in  any  part  of  which  any  manufacturing 
process connected with the production of these goods is being carried on or is ordinarily carried on; 

11[(ee) “Fund” means the Consumer Welfare Fund established under Section 12C;] 

 12[(f) “manufacture” includes any process— 

1. Subs. by Act 32 of 2003, s. 135, for “Gold (control)” (w.e.f. 14-05-2003). 
2. Clause (a) re-lettered by Act 44 of 1980, s. 50 and Sch. V, Part II (w.e.f. 11-10-1982). 
3. Subs. by Act 22 of 1995, s. 71, for “clause b” (w.e.f. 26-5-1995). 
4. Subs. by Act 25 of 2014, s. 96, for “Chief Commissioner of Central Excise” (w.e.f. 6-8-2014). 
5. Ins. by Act 27 of 1999, s. 120(i) (w.e.f. 11-5-1999).  
6. Subs. by ibid, s. 119, for Assistant Commissioner of Central Excise. 
7. Subs. by Act 18 of 2017, s. 5(a), for “the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 

1986)”.  

8. References to the expressions “duty”, “duties,” “duty of excise” and “duties of excise” shall, save as otherwise expressly provided 
in this Act and unless the context otherwise requires, be construed to include a reference to the special duty of excise specified 
in the Second Schedule to the Central Excise Tariff Act, 1985. 

9. Ins. by Act 18 of 2008, s. 78, (w.e.f. 10-5-2008). 
10. The word “other than salt” omitted by Act 18 of 2017, s. 5(b). 
11. Ins. by Act 40 of 1991, s. 2 (w.e.f. 20-2-1991). Earlier cl. (ee), ins. by Act 25 of 1950, s. 11 and Sch. IV, omitted by Act 41 of 

1954, s. 2 and Sch (w.e.f. 8-10-1954). 

12. Subs. by Act 5 of 1986, s. 4, for Sub-clause (f) (w.e.f. 28-2-1986). 

7 

 
                                                           
(i) incidental or ancillary to the completion of a manufactured product; 

(ii) which is specified in relation to any goods in the Section or Chapter Notes of 1[the Fourth 

Schedule] as amounting to 2[manufacture ;or], 

3[(iii)  which,  in  relation  to  the  goods  specified  in  the  Third  Schedule,  involves  packing  or 
repacking of such goods in a unit container or labelling or re-labelling of containers including the 
declaration or alteration of retail sale price on it or adoption of any other treatment on the goods to 
render the product marketable to the consumer;] 

and the word “manufacture” shall be construed accordingly and shall include not only a person 
who employs hired labour in the production or manufacture of excisable goods, but also any person 
who engages in their production or manufacture on his own account;] 

4[(ff) “National Tax Tribunal” means the National Tax Tribunal established under Section 3 of the 

National Tax Tribunal Act, 2005 (49 of 2005);] 

(g) “prescribed” means prescribed by rules made under this Act; 

(h) “sale” and “purchase”, with their grammatical variations and cognate expressions, mean any 
transfer of the possession of goods by one person to another in the ordinary course of trade or business 
for cash or deferred payment or other valuable consideration; 

(i) 5[* * *] 

(j) 6[* * *] 

(jj) 7[* * *] 

 (k) “wholesale dealer” means a person who buys or sells excisable goods wholesale for the purpose 
of  trade  or  manufacture,  and  includes  a  broker  or  commission  agent,  who,  in  addition  to  making 
contracts for the sale or purchase of excisable goods for others, stocks such goods belonging to others 
as an agent for the purpose of sale. 

8[2A.  References  of  certain  expressions.—  In  this  Act,  save  as  otherwise  expressly  provided  and 

unless the context otherwise requires, references to the expressions “duty”, “duties”, “duty of excise” and 

“duties of excise” shall be construed to include a reference to “Central Value Added Tax (CENVAT)”.] 

1. Subs. by Act 18 of 2017, s. 5(c), for “the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986)”. 
2. Subs. by Act 20 of 2002, s. 132(i), for “manufacture” (w.e.f. 11-5-2002). 
3. Subs. by Act 32 of 2003, s. 135, for sub-clause (iii). (w.e.f. 14-5-2003). 
4. Ins. by Act 49 of 2005, s. 30 and Sch. (Pt. VII-1) (w.e.f. 28-12-2005). 
5. Clause (i) omitted by Act 33 of 1996, s. 72, (w.e.f. 28-9-1996). 
6. Clause (j) omitted by ibid, s. 72, (w.e.f. 28-9-1996). 
7. Clause (jj), omitted by Act 25 of 1950, s. 11 and Sch. IV. Earlier clause (jj) was inserted by the A.O. 1950. 
8. Ins. by Act 10 of 2000, s. 91 (w.e.f. 12-5-2000). 

8 

 
 
                                                           
CHAPTER II 

LEVY AND COLLECTION OF DUTY 

1[3. Duty specified in the Fourth Schedule to be levied.— (1) There shall be levied and collected in 

such manner as may be prescribed a duty of excise to be called the Central Value Added Tax (CENVAT) 

on all excisable goods (excluding goods produced or manufactured in special economic zones) which are 

produced or manufactured in India as, and at the rates, set forth in the Fourth Schedule: 

Provided that the duty of excise which shall be levied and collected on any excisable goods which 
are produced or manufactured by a hundred per cent export oriented undertaking and brought to any 
other place in India, shall be an amount equal to the aggregate of the duties of customs which would be 
leviable under the Customs Act, 1962 (52 of 1962) or any other law for the time being in force, on like 
goods  produced  or  manufactured  outside  India  if  imported  into  India,  and  where  the  said  duties  of 
customs  are  chargeable  by  reference  to  their  value,  the  value  of  such  excisable  goods  shall, 
notwithstanding anything contained in any other provision of this Act, be determined in accordance 
with the provisions of the Customs Act, 1962 and the Customs Tariff Act, 1975 (51 of 1975). 

Explanation 1.— Where in respect of any such like goods, any duty of customs leviable for the time 

being in force is leviable at different rates, then, such duty shall, for the purposes of this proviso, be deemed 

to be leviable at the highest of those rates. 

Explanation 2.— For the purposes of this sub-section,— 

(i) “hundred per cent export-oriented undertaking” means an undertaking which has been approved 
as a hundred per cent export-oriented undertaking by the board appointed in this behalf by the Central 
Government in exercise of the powers conferred by Section 14 of the Industries (Development and 
Regulation) Act, 1951 (65 of 1951), and the rules made under that Act; 

(ii) “Special Economic Zone” shall have the meaning assigned to it in clause (za) of Section 2 of 

the Special Economic Zones Act, 2005 (28 of 2005). 

(2) The provisions of sub-section (1) shall apply in respect of all excisable goods which are produced 

or manufactured in India by or on behalf of the Government, as they apply in respect of goods which are 

not produced or manufactured by the Government. 

(3) The Central Government may, by notification in the Official Gazette, fix, for the purposes of levying 

the said duty, tariff values of any articles enumerated, either specifically or under general headings, in the 

Fourth Schedule as chargeable with duty ad valorem and may alter any tariff values for the time being in 

force. 

1. Subs. by Act 18 of 2017, s. 6, for section 3. 

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(4) The Central Government may fix different tariff values— 

(a) for different classes or descriptions of the same excisable goods; or 

(b) for excisable goods of the same class or description— 

(i) produced or manufactured by different classes of producers or manufacturers; or 

(ii) sold to different classes of buyers: 

Provided  that  in  fixing  different  tariff  values  in  respect  of  excisable  goods  falling  under                             

sub-clause (i) or sub-clause (ii), regard shall be had to the sale prices charged by the different classes 
of producers or manufacturers or, as the case may be, the normal practice of the wholesale trade in such 
goods.] 

1[3A. Power of Central Government to charge excise duty on the basis of capacity of production 

in respect of notified goods.— (1) Notwithstanding anything contained in Section 3, where the Central 

Government, having regard to the nature of the process of manufacture or production of excisable goods of 

any specified description, the extent of evasion of duty in regard to such goods or such other factors as may 

be relevant, is of the opinion that it is necessary to safeguard the interest of revenue, specify, by notification 

in the Official Gazette, such goods as notified goods and there shall be levied and collected duty of excise 

on such goods in accordance with the provisions of this section. 

(2) Where a notification is issued under sub-section (1), the Central Government may, by rules,— 

(a) provide the manner for determination of the annual capacity of production of the factory, in 
which such goods are produced, by an officer not below the rank of Assistant  2[Principal Commissioner 
of Central Excise or Commissioner of Central Excise] and such annual capacity shall be deemed to be 
the annual production of such goods by such factory; or 

(b)(i) specify the factor relevant to the production of such goods and the quantity that is deemed to 

be produced by use of a unit of such factor; and 

(ii) provide for the determination of the annual capacity of production of the factory in which such 
goods are produced on the basis of such factor by an officer not below the rank of Assistant  2[Principal 
Commissioner  of  Central  Excise  or  Commissioner  of  Central  Excise]  and  such  annual  capacity  of 
production shall be deemed to be the annual production of such goods by such factory: 

Provided that where a factory producing notified goods is in operation during a part of the year 
only, the annual production thereof shall be calculated on proportionate basis of the annual capacity of 
production: 

1. Ins. by Act 18 of 2008, s. 79. (w.e.f. 10-5-2008) Prior s. 3A was omitted by Act 14 of 2001, s. 121. 
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”.  

10 

 
                                                           
Provided further that in a case where the factor relevant to the production is altered or modified at 
any time during the year, the annual production shall be re-determined on a proportionate basis having 
regard to such alteration or modification. 

(3) The duty of excise on notified goods shall be levied, at such rate, on the unit of production or, as 

the case may be, on such factor relevant to the production, as the Central Government may, by notification 

in the Official Gazette, specify, and collected in such manner as may be prescribed: 

Provided that where a factory producing notified goods did not produce the notified goods during any 
continuous period of fifteen days or more, the duty calculated on a proportionate basis shall be abated in 
respect of such period if the manufacturer of such goods fulfils such conditions as may be prescribed. 

(4) The provisions of this section shall not apply to goods produced or manufactured, by a hundred per 

cent export-oriented undertaking and brought to any other place in India. 

Explanation 1.— For the removal of doubts, it is hereby clarified that for the purposes of Section 3 of 

the Customs Tariff Act, 1975 (51 of 1975), the duty of excise leviable on the notified goods shall be deemed 

to be the duty of excise leviable on such goods under the 1[Fourth Schedule], read with any notification for 

the time being in force. 

Explanation 2.— For the purposes of this section, the expression “hundred per cent export-oriented 

undertaking” shall have the meaning assigned to it in Section 3. 

2[Explanation 3.— For the purposes of sub-sections (2) and (3), the word “factor” includes “factors”.]] 

3[3B. Emergency power of Central Government to increase duty of excise.— (1) Where, in respect 

of any goods, the Central Government is satisfied that the duty leviable thereon under Section 3 should be 

increased  and  that  circumstances  exist  which  render  it  necessary  to  take  immediate  action,  the  Central 

Government may, by notification in the Official Gazette, amend the Fourth Schedule to substitute the rate 

of duty specified therein in respect of such goods in the following manner, namely— 

(a) in a case where the rate of duty as specified in the Fourth Schedule as in force immediately 
before  the  issue  of  such  notification  is  nil,  a  rate  of  duty  not  exceeding  fifty  per  cent  ad  valorem 
expressed in any form or method; 

(b) in any other case, a rate of duty which shall not be more than twice the rate of duty specified in 
respect  of  such  goods  in  the  Fourth  Schedule  as  in  force  immediately  before  the  issue  of  the  said 
notification: 

Provided that the Central Government shall not issue any notification under this sub-section 
for substituting the rate of duty in respect of any goods as specified by an earlier notification issued 

1. Subs. by Act 18 of 2017, s. 7, for “First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986)”. 
2. Ins. by Act 20 of 2015, s. 92. 
3. Ins. by Act 18 of 2017, s. 8. 

11 

 
                                                           
under this sub-section by that Government before such earlier notification has been approved with 
or without modifications under sub-section (2). 

Explanation.— For the purposes of this sub-section, the term “form or method”, in relation to a rate of 

duty of excise, means the basis, including valuation, weight, number, length, area, volume or any other 

measure, on which the duty may be levied. 

(2) Every notification under sub-section (1) shall be laid before each House of Parliament, if it is in 

session, as soon as may be after the issue of the notification, and, if it is not in session, within seven days 

of its reassembly, and the Central Government shall seek the approval of Parliament to the notification by 

a resolution moved within a period of fifteen days beginning with the day on which the notification is so 

laid before the House of the People and if Parliament makes any modification in the notification or directs 

that the notification should cease to have effect, the notification shall thereafter have effect only in such 

modified  form  or  be  of no  effect,  as  the case  may  be,  but  without prejudice to the  validity  of  anything 

previously done thereunder. 

(3) Any notification issued under sub-section (1), including a notification approved or modified under 

sub-section (2), may be rescinded by the Central Government at any time by issuing notification in the 

Official Gazette.] 

1[3C.  Power  of  Central  Government  to  amend  Fourth  Schedule.—(1)  Where  the  Central 

Government is satisfied that it is necessary so to do in the public interest, it may, by notification in the 

Official Gazette, amend the Fourth Schedule: 

Provided that such  amendment  shall  not  alter  or  affect in  any  manner the  rates  specified in the 

Fourth Schedule at which the duties of excise shall be leviable on the goods specified therein.] 

2[4. Valuation of excisable goods for purposes of charging of duty of excise.— (1) Where under this 

Act, the duty of excise is chargeable on any excisable goods with reference to their value, then, on each 

removal of the goods, such value shall— 

(a) in a case where the goods are sold by the assessee,  for delivery at the time and place of the 
removal, the assessee and the buyer of the goods are not related and the price is the sole consideration 
for the sale, be the transaction value; 

(b) in any other case, including the case where the goods are not sold, be the value determined in 

such manner as may be prescribed. 

1. Ins. by Act 18 of 2017, s. 8. 
2. Subs. by Act 10 of 2000, s. 94 (w.e.f. 1-7-2000). 

12 

 
 
                                                           
1[Explanation.—  For  the  removal  of  doubts,  it  is  hereby  declared  that  the  price-cum-duty  of  the 

excisable goods sold by the assessee shall be the price actually paid to him for the goods sold and the money 

value of the additional consideration, if any, flowing directly or indirectly from the buyer to the assessee in 

connection with the sale of such goods, and such price-cum-duty, excluding sales tax and other taxes, if 

any, actually paid, shall be deemed to include the duty payable on such goods.] 

(2) The provisions of this section shall not apply in respect of any excisable goods for which a tariff 

value has been fixed under sub-section (2) of Section 3. 

(3) For the purposes of this section,— 

(a) “assessee” means the person who is liable to pay the duty of excise under this Act and includes 

his agent; 

(b) persons shall be deemed to be “related” if— 

(i) they are inter-connected undertakings; 

(ii) they are relatives; 

(iii) amongst them the buyer is a relative and a distributor of the assessee, or a sub-distributor 

of such distributor; or 

(iv) they are so associated that they have interest, directly or indirectly, in the business of each 

other. 

Explanation.—In this clause— 

2[(i) “inter-connected undertakings” means two or more undertakings which are inter-connected 

with each other in any of the following manners, namely— 

(A) if one owns or controls the other; 

(B) where the undertakings are owned by firms, if such firms have one or more common partners; 

(C) where the undertakings are owned by bodies corporate,— 

(I) if one body corporate manages the other body corporate; or 

(II) if one body corporate is a subsidiary of the other body corporate; or 

(III) if the bodies corporate are under the same management; or 

(IV)  if one  body  corporate  exercises  control  over  the  other  body  corporate in  any  other 

manner; 

1. Ins. by Act 32 of 2003, s. 136, (w.e.f. 14-5-2003). 
2. Subs. by Act 23 of 2012, s. 133, for “(i)”. 

13 

 
                                                           
 
(D) where one undertaking is owned by a body corporate and the other is owned by a firm, if one 

or more partners of the firm,— 

(I) hold, directly or indirectly, not less than fifty per cent of the shares, whether preference or 

equity, of the body corporate; or 

(II)  exercise  control,  directly  or  indirectly,  whether  as  director  or  otherwise,  over  the  body 

corporate; 

(E) if one is owned by a body corporate and the other is owned by a firm having bodies corporate 

as its partners, if such bodies corporate are under the same management; 

(F) if the undertakings are owned or controlled by the same person or by the same group; 

(G) if one is connected with the other either directly or through any number of undertakings which 

are inter-connected undertakings within the meaning of one or more of the foregoing sub-clauses. 

Explanation I.— For the purposes of this clause, two bodies corporate shall be deemed to be under 

the same management— 

(i) if one such body corporate exercises control over the other or both are under the control of the 

same group or any of the constituents of the same group; or 

(ii) if the Managing Director or manager of one such body corporate is the Managing Director or 

manager of the other; or 

(iii) if one such body corporate holds not less than one-fourth of the equity shares in the other or 
controls the composition of not less than one-fourth of the total membership of the Board of Directors 
of the other; or 

(iv) if one or more directors of one such body corporate constitute, or at any time within a period 
of  six  months  immediately  preceding  the  day  when  the  question  arises  as  to  whether  such  bodies 
corporate  are  under  the  same  management,  constituted  (whether  independently  or  together  with 
relatives  of  such  directors  or  employees  of  the  first  mentioned  body  corporate)  one-fourth  of  the 
directors of the other; or 

(v) if the same individual or individuals belonging to a group, while holding (whether by themselves 
or together with their relatives) not less than one-fourth of the equity shares in one such body corporate 
also hold (whether by themselves or together with their relatives) not less than one-fourth of the equity 
shares in the other; or 

(vi)  if  the  same  body  corporate  or  bodies  corporate  belonging  to  a  group,  holding,  whether 
independently or along with its or their subsidiary or subsidiaries, not less than one-fourth of the equity 
shares in one body corporate, also hold not less than one-fourth of the equity shares in the other; or 

14 

 
(vii)  if  not  less  than  one-fourth  of  the  total  voting  power  in  relation  to  each  of  the  two  bodies 
corporate is exercised or controlled by the same individual (whether independently or together with his 
relatives) or the same body corporate (whether independently or together with its subsidiaries); or 

(viii)  if  not less  than  one-fourth of  the  total  voting  power  in relation to  each  of  the  two  bodies 
corporate is exercised or controlled by the same individuals belonging to a group or by the same bodies 
corporate belonging to a group, or jointly by such individual or individuals and one or more of such 
bodies corporate; or 

(ix)  if  the  directors  of  one  such  body  corporate  are  accustomed  to  act  in  accordance  with  the 
directions or instructions of one or more of the directors of the other, or if the directors of both the 
bodies corporate are accustomed to act in accordance with the directions or instructions of an individual, 
whether belonging to a group or not. 

Explanation II.— If a group exercises control over a body corporate, that body corporate and every 
other body corporate, which is a constituent of, or controlled by, the group shall be deemed to be under 
the same management. 

Explanation III.—  If  two  or  more  bodies  corporate  under  the  same  management  hold,  in  the 
aggregate, not less than one-fourth equity share capital in any other body corporate, such other body 
corporate shall be deemed to be under the same management as the first mentioned bodies corporate. 

Explanation IV.— In determining whether or not two or more bodies corporate are under the same 
management, the shares held by financial institutions in such bodies corporate shall not be taken into 
account. 

Illustration 

inter-connected  with  undertaking A and  undertaking C is 

inter-connected  with 
Undertaking B is 
undertaking B. Undertaking C is inter-connected with undertaking A; if undertaking D is inter-connected 
with  undertaking C,  undertaking D will  be  inter-connected  with  undertaking  B  and  consequently  with 
undertaking A; and so on. 

Explanation V.— For the purposes of this clause, “group” means a group of— 

(i) two or more individuals, associations of individuals, firms, trusts, trustees or bodies corporate 
(excluding financial institutions), or any combination thereof, which exercises, or is established to be 
in a position to exercise, control, directly or indirectly, over any body corporate, firm or trust; or 

(ii) “associated persons”. 

Explanation VI.— For the purposes of this clause,— 

(I) a group of persons who are able, directly or indirectly, to control the policy of a body corporate, 
firm or trust, without having a controlling interest in that body corporate, firm or trust, shall also be 
deemed to be in a position to exercise control over it; 

15 

 
(II) associated persons— 

(a) in relation to a director of a body corporate, means— 

(i) a relative of such director, and includes a firm in which such director or his relative is a 

partner; 

(ii) any trust of which any such director or his relative is a trustee; 

(iii)  any  company  of  which  such  director,  whether  independently  or  together  with  his 

relatives, constitutes one-fourth of its Board of Directors; 

(iv) any other body corporate, at any general meeting of which not less than one-fourth of 
the total number of directors of such other body corporate are appointed or controlled by the 
director of the first mentioned body corporate or his relative, whether acting singly or jointly; 

(b) in relation to the partner of a firm, means a relative of such partner and includes 

any other partner of such firm; and 

(c) in relation to the trustee of a trust, means any other trustee of such trust; 

(III) where any person is an associated person in relation to another, the letter shall also be 

deemed to be an associated person in relation to the former;] 

(b)  “relative”  shall  have  the  meaning  assigned  to  it  in  clause  (41)  of  Section  2  of  the 

Companies Act, 1956 (1 of 1956); 

(c) “place of removal” means— 

(i)  a  factory  or  any  other  place  or  premises  of  production  or  manufacture  of  the 

excisable goods; 

(ii) a warehouse or any other place or premises wherein the excisable goods have been 

permitted to be deposited without 1[payment of duty;] 

2[(iii) a depot, premises of a consignment agent or any other place or premises from 

where the excisable goods are to be sold after their clearance from the factory,] 

from where such goods are removed; 

2[(cc)  “time  of  removal”,  in  respect  of  the  excisable  goods  removed  from  the  place  of 
removal referred to in sub-clause (iii) of clause (c), shall be deemed to be the time at which 
such goods are cleared from the factory;] 

(d) “transaction value” means the price actually paid or payable for the goods, when sold, 
and includes in addition to the amount charged as price, any amount that the buyer is liable to 

1. Subs. by Act 32 of 2003, s. 136, for “payment of duty,”. 
2. Ins. by, ibid, s. 136. 

16 

 
                                                           
pay  to,  or  on  behalf  of,  the  assessee,  by  reason  of,  or  in  connection  with  the  sale,  whether 
payable at the time of the sale or at any other time, including, but not limited to, any amount 
charged  for,  or  to  make  provision  for,  advertising  or  publicity,  marketing  and  selling 
organization  expenses,  storage,  outward  handling,  servicing,  warranty,  commission  or  any 
other matter; but does not include the amount of duty of excise, sales tax and other taxes, if 
any, actually paid or actually payable on such goods.] 

1[4A. Valuation of excisable goods with reference to retail sale price.— (1) The Central Government 

may, by notification in the Official Gazette, specify any goods, in relation to which it is required, under the 

provisions of the 2[Legal Metrology Act, 2009 (1 of 2010)] or the rules made thereunder or under any other 

law for the time being in force, to declare on the package thereof the retail sale price of such goods, to 

which the provisions of sub-section (2) shall apply. 

(2) Where the goods specified under sub-section (1) are excisable goods and are chargeable to duty of 

excise with reference to value, then, notwithstanding anything contained in Section 4, such value shall be 

deemed to be the retail sale price declared on such goods less such amount of abatement, if any, from such 

retail sale price as the Central Government may allow by notification in the Official Gazette. 

(3) The Central Government may, for the purpose of allowing any abatement under sub-section (2), 

take into account the amount of duty of excise, sales tax and other taxes, if any, payable on such goods. 

3[(4) Where any goods specified under sub-section (1) are excisable goods and the manufacturer— 

(a) removes such goods from the place of manufacture, without declaring the retail sale price of 
such goods on the packages or declares a retail sale price which is not the retail sale price as required 
to  be  declared  under  the  provisions  of  the  Act,  rules  or  other  law  as  referred  to  in                                                    
sub-section (1); or 

(b) tampers with, obliterates or alters the retail sale price declared on the package of such goods 

after their removal from the place of manufacture,  

then,  such  goods  shall  be  liable  to  confiscation  and  the  retail  sale  price  of  such  goods  shall  be 
ascertained in the prescribed manner and such price shall be deemed to be the retail sale price for the 
purposes of this section. 

4[Explanation  1.—For  the purposes  of  this  section, “retail  sale  price”  means the maximum  price  at 

which the excisable goods in packaged form may be sold to the ultimate consumer and includes all taxes 

local  or  otherwise,  freight,  transport  charges,  commission  payable  to  dealers,  and  all  charges  towards 

1. Ins. by Act 26 of 1997, s. 82. 
2. Subs. by Act 8 of 2011, s. 62 (w.e.f. 1-8-2011). 
3. Subs. by Act 32 of 2003, s. 137, for sub-section (4). 
4. Subs. by Act 21 of 1998, s. 105. 

17 

 
                                                           
advertisement, delivery,  packing,  forwarding  and the like,  as the  case  may  be,  and  the  price  is  the sole 

consideration for such sale: 

Provided that in case the provisions of the Act, rules or other law as referred to in sub-section (1) 
require to declare on the package, the retail sale price excluding any taxes, local or otherwise, the retail 
sale price shall be construed accordingly. 

Explanation 2.— For the purposes of this section,— 

(a) where on the package of any excisable goods more than one retail sale price is declared, the 

maximum of such retail sale price shall be deemed to be the retail sale price; 

(b)  where  the  retail  sale  price,  declared  on  packages  of  any  excisable  goods  at  the  time  of  its 
clearance from the place of manufacture, is altered to increase the retail sale price, such altered retail 
sale price shall be deemed to be the retail sale price; 

(c) where different retail sale prices are declared on different packages for the sale of any excisable 
goods in packaged form in different areas, each such retail sale price shall be the retail sale price for 
the purposes of valuation of the excisable goods intended to be sold in the area to which the retail sale 
price relates.] 

1[5. Remission of duty on goods found deficient in quantity.— (1) The Central Government may, by 

rules made under this section, provide for remission of duty of excise leviable on any excisable goods which 

due to any natural cause are found to be deficient in quantity. 

(2) Any rules made under sub-section (1) may, having regard to the nature of the excisable goods or of 

processing or of curing thereof, the period of their storage or transit and other relevant considerations, fix 

the limit or limits of percentage beyond which no such remission shall be allowed: 

Provided that different limit or limits of percentage may be fixed for different varieties of the same 

excisable goods or for different areas or for different seasons.] 

2[5A. Power to grant exemption from duty of excise.—(1) If the Central Government is satisfied that 

it is necessary in the public interest so to do, it may, by notification in the Official Gazette, exempt generally 

either absolutely or subject to such conditions (to be fulfilled before or after removal) as may be specified 

in the notification, excisable goods of any specified description from the whole or any part of the duty of 

excise leviable thereon: 

Provided that, unless specifically provided in such notification, no exemption therein shall apply to 

excisable goods which are produced or manufactured— 

1. Ins. by Act 25 of 1978, s. 20 (w.e.f. 1-7-1978). The original section was omitted by Act 41 of 1954, s. 2 and Sch. 
2. Ins. by Act 29 of 1988, s. 9 (w.e.f. 1-7-1988). 

18 

 
                                                           
(i) in a 1[free trade zone 2[* * *]] and brought to any other place in India; or 

(ii) by a hundred per cent export-oriented undertaking and 3[brought to any other place in India]. 

Explanation.—In  this  proviso,  1[“free  trade  zone” 4[*  *  *]  and  “hundred  per  cent  export-oriented 

undertaking” shall have the same meanings as in Explanation 2 to sub-section (1) of Section 3. 

5[(1A) For the removal of doubts, it is hereby declared that where an exemption under sub-section (1) 

in respect of any excisable goods from the whole of the duty of excise leviable thereon has been granted 

absolutely, the manufacturer of such excisable goods shall not pay the duty of excise on such goods.] 

6[(2) If the Central Government is satisfied that it is necessary in the public interest so to do, it may, by 

special  order  in  each  case,  exempt  from  the  payment  of  duty  of  excise,  under  circumstances  of  an 

exceptional nature to be stated in such order, any excisable goods on which duty of excise is leviable.] 

7[(2A) The Central Government may, if it considers it necessary or expedient so to do for the purpose 

of clarifying the scope or applicability of any notification issued under sub-section (1) or order issued under 

sub-section (2), insert an explanation in such notification or order, as the case may be, by notification in the 

Official Gazette at any time within one year of issue of the notification under sub-section (1) or order under 

sub-section (2), and every such explanation shall have effect as if it had always been the part of the first 

notification or order, as the case may be.] 

(3) An exemption under sub-section (1) or sub-section (2) in respect of any excisable goods from any 

part of the duty of excise leviable thereon (the duty of excise leviable thereon being hereinafter referred to 

as the statutory duty) may be granted by providing for the levy of a duty on such goods at a rate expressed 

in a form  or  method  different  from  the form  or  method  in  which  the statutory duty  is leviable and  any 

exemption granted in relation to any excisable goods in the manner provided in this sub-section shall have 

effect subject to the condition that the duty of excise chargeable on such goods shall in no case exceed the 

statutory duty. 

Explanation.—  “Form  or  method”,  in  relation  to  a  rate  of  duty  of  excise  means  the  basis,  namely, 

valuation,  weight,  number,  length,  area,  volume  or  other  measure  with  reference  to  which  the  duty  is 

leviable. 

(4) Every notification issued under sub-rule (1), and every order made under sub-rule (2), of Rule 8 of 

the Central Excise Rules, 1944, and in force immediately before the commencement of the Customs and 

1. Subs. by Act 14 of 2001, s. 122, for “free trade zone”.  
2. The words “or a special economic zone” omitted by Act 20 of 2002, s. 134 (w.e.f. a date to be notified). 
3. Subs. by Act 14 of 2001, s. 122, for “allowed to be sold in India”,. 
4. The words “, special economic zone” omitted by Act 20 of 2002, s. 134 (w.e.f. a date to be notified). 
5. Ins. by Act 18 of 2005, s. 75. 
6. Subs. by Act 32 of 2003, s. 138, for “sub-section (2)”. 
7. Ins. by Act 20 of 2002, s. 134. 

19 

 
                                                           
Central Excises Laws (Amendment) Act, 1988 shall be deemed to have been issued or made under the 

provisions of this section and shall continue to have the same force and effect after such commencement 

until it is amended, varied, rescinded or superseded under the provisions of this section.] 

1[(5)  Every  notification  issued  under  sub-section  (1)  or  sub-section  (2-A)  shall,  unless  otherwise 

provided, come into force on the date of its issue by the Central Government for publication in the Official 

Gazette.] 

(6) 2[* * *]] 

3[5B. Non-reversal of CENVAT credit.— Where an assessee has paid duty of excise on a final product 

and has been allowed credit of the duty or tax or cess paid on inputs, capital goods and input services used 

in making of the said product, but subsequently the process of making the said product is held by the court 

as not chargeable to excise duty, the Central Government may, by notification, order for non-reversal of 

such credit allowed to the assessee subject to such conditions as may be specified in the said notification: 

Provided that the order for non-reversal of credit shall not apply where an assessee has preferred a 

claim for refund of excise duty paid by him: 

Provided further that the Central Government may also specify in the notification referred to above 

for non-reversal of credit, if any, taken by the buyer of the said product.] 

4[6. Registration of certain persons.— Any prescribed person who is engaged in— 

(a) the production or manufacture or any process of production or manufacture of any specified 
goods included in the 5[First Schedule and the Second Schedule] to the Central Excise Tariff Act, 1985 
(5 of 1986), or 

(b) the wholesale purchase or sale (whether on his own account or as a broker or commission agent) 
or the storage of any specified goods included in the 5[First Schedule and the Second Schedule] to the 
Central Excise Tariff Act, 1985 (5 of 1986), 

shall get himself registered with the proper officer in such manner as may be prescribed.] 

7. Form and Conditions of licence.—[Omitted by the Finance Act, 1992 (Act 18 of 1992), s. 113.  

8. Restriction on possession of goods specified in the Second Schedule.— From such date as may 

be specified in this behalf by the Central Government by notification in the Official Gazette, no person 

1. Subs. by Act 28 of 2016, S. 142(i), for clause (5).  
2. Clause (6) Omitted by Act 28 of 2016, s. 142(ii).  
3. Ins. by Act 22 of 2007, s. 116.  
4. Subs. by Act 18 of 1992, s. 113(i), for section 6, (w.e.f. 14-5-1992). 
5. Subs. by Act 27 of 1999, s. 119, for “the schedule” (w.e.f. 11-5-1999). 

20 

 
                                                           
shall, except as provided by rules made under this Act, have in his possession 1[any goods specified in the 

Second Schedule] in excess of such quantity as may be prescribed for the purposes of this section as the 

maximum amount of such goods or of any variety of such goods which may be possessed at any one time 

by such a person. 

9. Offences and penalties.—2[(1)] Whoever commits any of the following offences, namely:— 3[(a) 

contravenes  any  of  the  provisions  of  Section  8  or  of  a  rule  made  under  clause  (iii)  or  clause  (xxvii)  of                   

sub-section (2) of Section 37;] 

(b) evades the payment of any duty payable under this Act; 

4[(bb) removes any excisable goods in contravention of any of the provisions of this Act or any 

rules made thereunder or in any way concerns himself with such removal; 

(bbb) acquires possession of, or in any way concerns himself in transporting, depositing, keeping, 
concealing,  selling  or  purchasing,  or in  any  other  manner  deals  with any  excisable  goods  which  he 
knows or has reason to believe are liable to confiscation under this Act or any rule made thereunder;] 

5[(bbbb) contravenes any of the provisions of this Act or the rules made thereunder in relation to 

credit of any duty allowed to be utilised towards payment of excise duty on final products;] 

(c) fails to supply any information which he is required by rules made under this Act to supply, or 
(unless with a reasonable belief, the burden of proving which shall be upon him, that the information 
supplied by him is true) supplies false information; 

(d) attempts to commit, or abets the commission of, any of the offences mentioned in clauses (a) 

and (b) of this section; 

6[shall be punishable,— 

(i) in the case of an offence relating to any excisable goods, the duty leviable thereon under this 
Act exceeds 7[fifty lakh] of rupees, with imprisonment for a term which may extend to seven years and 
with fine: 

Provided that in the absence of special and adequate reasons to the contrary to be recorded in the 

judgment of the Court such imprisonment shall not be for a term of less than six months; 

1. Subs. by Act 18 of 1956, s. 9, for “any excisable goods specified in this behalf in Part B of the Second Sch.” (w.e.f. 27-4-

1956). 

2. S. 9 renumbered as sub-section (1) of that section by Act 36 of 1973, s. 20 (w.e.f. 1-9-1973). 
3. Subs. by Act 18 of 1992, s. 113, for “clause (a)” (w.e.f. 14-5-1992). 
4. Ins. by Act 36 of 1973, s. 20(i)(a) (w.e.f. 1-9-1973). 
5. Ins. by Act 21 of 1998, s. 107 (w.e.f. 1-8-1998). 
6. Subs. by Act 36 of 1973, s. 20(i)(b) for certain words. 
7. Subs. by Act 17 of 2013, s. 88, for “thirty lakh”. 

21 

 
                                                           
(ii) in any other case, with imprisonment for a term which may extend to three years or with fine 

or with both.] 

1[(2) If any person convicted of an offence under this section is again convicted of an offence under 

this section, then, he shall be punishable for the second and for every subsequent offence with imprisonment 

for a term which may extend to seven years and with fine: 

Provided that in the absence of special and adequate reasons to the contrary to be recorded in the 

judgment of the Court such imprisonment shall not be for a term of less than six months. 

(3) For the purposes of sub-sections (1) and (2), the following shall not be considered as special and 

adequate reasons for awarding a sentence of imprisonment for a term of less than six months, namely:— 

(i) the fact that the accused has been convicted for the first time for an offence under this Act; 

(ii) the fact that in any proceeding under this Act, other than a prosecution, the accused has been 
ordered to pay a penalty or the goods in relation to such proceedings have been ordered to be confiscated 
or any other action has been taken against him for the same act which constitutes the offence; 

(iii) the fact that the accused was not the principal offender and was acting merely as a carrier of 

goods or otherwise was a secondary party in the commission of the offence; 

(iv) the age of the accused.] 

2[9A. Certain offences to be non-cognizable.— 3[(1) Notwithstanding anything contained in the Code 

of Criminal Procedure, 1973 (2 of 1974), offences under Section 9, except the offences referred to in sub-

section (1A), shall be non-cognizable within the meaning of that Code. 

(1A) The offences relating to excisable goods where the duty leviable thereon under this Act exceeds 

fifty lakh rupees and punishable under clause (b) or clause (bbbb) of sub-section (1) of Section 9, shall be 

cognizable and non-bailable.] 

4[(2)  Any  offence  under  this  chapter  may,  either  before  or  after  the  institution  of  prosecution,  be 
compounded by the 5[Principal Chief Commissioner of Central Excise or Chief Commissioner of Central 

Excise]  on  payment,  by  the  person  accused  of  the  offence  to  the  Central  Government,  of 6[such 

compounding amount and in such manner of compounding] as may be prescribed:] 

7[Provided that nothing contained in this sub-section shall apply to— 

1. Ins. by Act 36 of 1973, s. 20(ii). 
2. Ins. by ibid, s. 21. 
3. Subs. by Act 17 of 2013, s. 89, for (1) 
4. Ins. by Act 23 of 2004, s. 79. 
5. Subs. by Act 25 of 2014, s. 95, for “Chief Commissioner of Central Excise”. 
6. Subs. by Act 33 of 2009, s. 104(i) for “such compounding amount”. 
7. Ins. by Act 33 of 2009, s. 104(ii). 

22 

 
                                                           
(a) a person who has been allowed to compound once in respect of any of the offences under the 

provisions of clause (a), (b), (bb), (bbb), (bbbb) or (c) of sub-section (1) of Section 9; 

(b) a person who has been accused of committing an offence under this Act which is also an offence 

under the Narcotic Drugs and Psychotropic Substances Act, 1985 (61 of 1985); 

(c) a person who has been allowed to compound once in respect of any offence under this chapter 

for goods of value exceeding rupees one crore; 

(d)  a  person  who  has  been  convicted  by  the  court  under  this  Act  on  or  after  the  30th  day  of 

December, 2005.] 

1[9AA.  Offences  by  companies.—  (1)  Where  an  offence  under  this  Act  has  been  committed  by  a 

company, every person who, at the time the offence was committed was in charge of, and was responsible 

to, the company for the conduct of the business of the company, as well as the company, shall be deemed 

to be guilty of the offence and shall be liable to be proceeded against and punished accordingly: 

Provided  that  nothing  contained  in  this  sub-section  shall  render  any  such  person  liable  to  any 
punishment provided in this Act, if he proves that the offence was committed without his knowledge 
or that he had exercised all due diligence to prevent the commission of such offence. 

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been 

committed  by  a  company  and  it  is  proved  that  the  offence  has  been  committed  with  the  consent  or 

connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other 

officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty 

of that offence and shall be liable to be proceeded against and punished accordingly. 

Explanation.—For the purposes of this section,— 

(a) “company” means anybody corporate and includes a firm or other association of individuals; 

and 

(b) “director” in relation to a firm means a partner in the firm.] 

2[9B.  Power  of  Court  to  publish  name,  place  of  business,  etc.,  of  persons  convicted  under  the 

Act.— (1) Where any person is convicted under this Act for contravention of any of the provisions thereof, 

it  shall  be  competent  for  the  Court  convicting  the  person  to  cause  the  name  and  place  of  business  or 

residence of such person, nature of the contravention, the fact that the person has been so convicted and 

such other particulars as the Court may consider to be appropriate in the circumstances of the case, to be 

published at the expense of such person, in such newspapers or in such manner as the Court may direct. 

1. Ins. by Act 79 of 1985, s. 2 (w.e.f. 27-12-1985). 
2. Ins. by Act 36 of 1973, s. 21. 

23 

 
                                                           
 
(2) No publication under sub-section (1) shall be made until the period for preferring an appeal against 

the orders of the Court has expired without any appeal having been preferred, or such an appeal, having 

been preferred, has been disposed of. 

(3)  The  expenses  of  any  publication  under  sub-section  (1)  shall  be  recoverable  from  the  convicted 

person as if it were a fine imposed by the Court.] 

1[9C. Presumption of culpable mental state.— (1) In any prosecution for an offence under this Act 

which requires a culpable mental state on the part of the accused, the Court shall presume the existence of 

such mental state but it shall be a defence for the accused to prove the fact that he had no such mental state 

with respect to the act charged as an offence in that prosecution. 

Explanation.— In this section, “culpable mental state” includes intention, motive, knowledge of a fact, 

and belief in, or reason to believe, a fact. 

(2) For the purposes of this section, a fact is said to be proved only when the Court believes it to exist 

beyond  reasonable  doubt  and  not  merely  when  its  existence  is  established  by  a  preponderance  of 

probability.] 

1[9D. Relevancy of statements under certain circumstances.— (1) A statement made and signed by 

a person before any Central Excise Officer of a gazetted rank during the course of any inquiry or proceeding 

under this Act shall be relevant, for the purpose of proving, in any prosecution for an offence under this 

Act, the truth of the facts which it contains,— 

(a) when the person who made the statement is dead or cannot be found, or is incapable of giving 
evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without 
an  amount  of  delay  or  expense  which,  under  the  circumstances  of  the  case,  the  Court  considers 
unreasonable; or 

(b) when the person who made the statement is examined as a witness in the case before the Court 
and the Court is of opinion that, having regard to the circumstances of the case, the statement should 
be admitted in evidence in the interests of justice. 

(2) The provisions of sub-section (1) shall, so far as may be, apply in relation to any proceeding under 

this Act, other than a proceeding before a Court, as they apply in relation to a proceeding before a Court.] 

 1[9E. Application of Section 562 of the Code of Criminal Procedure, 1898, and of the Probation 

of Offenders Act, 1958.— (1) Nothing contained in Section 562 of the Code of Criminal Procedure, 1898  

1. Ins. by Act 36 of 1973, s. 21. 

24 

 
                                                           
(5 of 1898)1, or in the Probation of Offenders Act, 1958 (20 of 1958), shall apply to a person convicted 

of an offence under this Act unless that person is under eighteen years of age. 

(2)  The  provisions  of  sub-section  (1)  shall  have  effect  notwithstanding  anything  contained  in                            

sub-section (3) of Section 9.] 

10. Power of Courts to order forfeiture.— Any Court trying an offence under this Chapter may order 
the forfeiture to 2[Government] of any goods in respect of which the Court is satisfied that an offence under 

this  Chapter  has  been  committed,  and  may  also  order  the  forfeiture  of  any  receptacles,  packages  or 

coverings in which such goods are contained and the animals, vehicles, vessels or other conveyances used 

in carrying the goods, and any implements or machinery used in the manufacture of the goods. 

11. Recovery of sums due to Government.— 3[(1)] In respect of duty and any other sums of any kind 

payable  to  the  Central  Government  under  any  of  the  provisions  of  this  Act  or  of  the  rules  made 

thereunder  4[including the amount required to be paid to the credit of the Central Government under Section 
11-D], the officer empowered by the 5[Central Board of Excise and Customs constituted under the Central 

Boards of Revenue Act, 1963 (54 of 1963)] to levy such duty or require the payment of such sums 6[may 

deduct  or require  any  other  Central  Excise  Officer or  a  proper  officer referred  to  in  Section  142  of the 

Customs Act, 1962 (52 of 1962) to deduct the amount so payable from any money owing to the person 

from whom such sums may be recoverable or due which may be in his hands or under his disposal or control 

or may be in the hands or under disposal or control of such other officer, or may recover the amount] by 

attachment  and  sale  of  excisable  goods  belonging  to  such  person;  and  if  the  amount  payable  is  not  so 

recovered he may prepare a certificate signed by him specifying the amount due from the person liable to 

pay the same and send it to the Collector of the district in which such person resides or conducts his business 

and  the  said  Collector,  on receipt  of  such  certificate, shall  proceed to  recover  from  the  said  person  the 

amount specified therein as if it were an arrear of land revenue: 

7[(2)(i) The Central Excise Officer may, by a notice in writing, require any other person from whom 
money is due to such person, or may become due to such person, or who holds or may subsequently 
hold money for or on account of such person, to pay to the credit of the Central Government either 
forthwith upon the money becoming due or being held, or at or within the time specified in the notice, 

1. Now the relevant provisions of the CRPC, 1973 (2 of 1974). 
2. Subs. by the A.O. 1950. 
3. Renumbered sub-section (1) by Act 17 of 2013, s. 90. 
4. Ins. by Act 10 of 2000, s. 96. 
5. Subs. by Act 54 of 1963, s. 5 for “Central Board of Revenue” (w.e.f. 1-1-1964), here and throughout the Act. 
6. Subs. by Act 17 of 2013, s. 90(a) for “may deduct the amount so payable from any money owing to the person from whom 

such sums may be recoverable or due which may be in his hands or under his disposal or control, or may recover the amount” 
by Act 17 of 2013, s. 90(a). 
7. Ins. by Act 17 of 2013, s. 90(b). 

25 

 
                                                           
not being before the money becomes due or is held, so much of the money as is sufficient to pay the 
amount due from such person or the whole of the money when it is equal to or less than that amount; 

(ii) every person to whom a notice is issued under this sub-section shall be bound to comply with 
such notice, and in particular, where any such notice is issued to a post office, banking company or an 
insurer, it shall not be necessary to produce any pass book, deposit receipt, policy or any other document 
for  the  purpose  of  any  entry,  endorsement  or  the  like  being  made  before  payment  is  made, 
notwithstanding any rule, practice or requirement to the contrary; 

(iii) in a case where the person to whom a notice under this sub-section has been issued, fails to 
make the payment in pursuance thereof to the Central Government, he shall be deemed to be a person 
from whom duty and any other sums of any kind payable to the Central Government under any of the 
provisions of this Act or the rules made thereunder have become due, in respect of the amount specified 
in the notice and all the consequences under this Act shall follow.] 

1[Provided that where the person (hereinafter referred to as predecessor) from whom the duty or 
any other sums of any kind, as specified in this section, is recoverable or due, transfers or otherwise 
disposes of his business or trade in whole or in part, or effects any change in the ownership thereof, in 
consequence  of  which  he  is  succeeded  in  such  business  or  trade  by  any  other  person,  all  excisable 
goods,  materials,  preparations,  plants,  machineries,  vessels,  utensils,  implements  and  articles  in  the 
custody  or  possession  of  the  person  so  succeeding  may  also  be  attached  and  sold  by  such  officer 
empowered  by  the  Central  Board  of  Excise  and  Customs,  after  obtaining  written  approval  from 
the 2[Principal Commissioner of Central Excise or Commissioner of Central Excise], for the purposes 
of recovering such duty or other sums recoverable or due from such predecessor at the time of such 
transfer or otherwise disposal or change.] 

3[11A.  Recovery  of  duties  not  levied  or  not  paid  or  short-levied  or  short-paid  or  erroneously 

refunded.— (1) Where any duty of excise has not been levied or paid or has been short-levied or short-

paid  or  erroneously  refunded,  for  any  reason,  other  than  the  reason  of  fraud  or  collusion  or  any  wilful 

misstatement or suppression of facts or contravention of any of the provisions of this Act or of the rules 

made thereunder with intent to evade payment of duty,— 

(a) the Central Excise Officer shall, within 4[two years] from the relevant date, serve notice on the 
person chargeable with the duty which has not been so levied or paid or which has been so short-levied 
or short-paid or to whom the refund has erroneously been made, requiring him to show cause why he 
should not pay the amount specified in the notice; 

1. Ins. by Act 23 of 2004, s. 80. 
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
3. Subs. by Act 8 of 2011, s. 63. 
4. Subs. by Act 28 of 2016, s. 143, for “one year”. 

26 

 
                                                           
(b) the person chargeable with duty may, before service of notice under clause (a), pay on the basis 

of,— 

(i) his own ascertainment of such duty; or 

(ii) the duty ascertained by the Central Excise Officer, 

the amount of duty along with interest payable thereon under Section 11-AA. 

(2) The person who has paid the duty under clause (b) of sub-section (1), shall inform the Central Excise 

Officer of such payment in writing, who, on receipt of such information, shall not serve any notice under 

clause (a) of that sub-section in respect of the duty so paid or any penalty leviable under the provisions of 

this Act or the rules made thereunder. 

(3)  Where  the  Central  Excise  Officer  is  of  the  opinion  that  the  amount  paid  under  clause  (b)  of                          

sub-section  (1)  falls  short  of  the  amount  actually  payable,  then,  he  shall  proceed  to  issue  the  notice  as 

provided for in clause (a) of that sub-section in respect of such amount which falls short of the amount 
actually  payable  in  the  manner  specified  under  that  sub-section  and  the  period  of 1[two  years]  shall  be 

computed from the date of receipt of information under sub-section (2). 

(4) Where  any  duty  of  excise  has  not  been  levied  or paid  or  has  been  short-levied  or  short-paid  or 

erroneously refunded, by the reason of— 

(a) fraud; or 

(b) collusion; or 

(c) any wilful misstatement; or 

(d) suppression of facts; or 

(e) contravention of any of the provisions of this Act or of the rules made thereunder with intent to 

evade payment of duty, 

by any person chargeable with the duty, the Central Excise Officer shall, within five years from the 

relevant date, serve notice on such person requiring him to show cause why he should not pay the amount 

specified in the notice along with interest payable thereon under Section 11-AA and a penalty equivalent 

to the duty specified in the notice. 

(5) 2[* * *] 

(6) 3[* * *] 

1. Subs. by Act 28 of 2016, s. 143, for “one year”. 
2. Sub-section (5) omitted by Act 20 of 2015, s. 93(i). 
3. Sub-section (6) omitted by ibid, s. 93(i).  

27 

 
                                                           
(7) 1[* * *] 

2[(7A) Notwithstanding anything contained in sub-section (1) or sub-section (3) or sub-section (4) 3[* 

* *], the Central Excise Officer may, serve, subsequent to any notice or notices served under any of those 

sub-sections, as the case may be, a statement, containing the details of duty of central excise not levied or 

paid  or  short-levied  or  short-paid  or  erroneously  refunded  for  the  subsequent  period,  on  the  person 

chargeable to duty of central excise, then, service of such statement shall be deemed to be service of notice 
on such person under the aforesaid sub-section (1) or sub-section (3) or sub-section (4) 3[* * *], subject to 

the condition that the grounds relied upon for the subsequent period are the same as are mentioned in the 

earlier notice or notices.] 

4[(8) Where the service of notice is stayed by an order of a court or tribunal, the period of such stay 

shall be excluded in computing the period of 5[two years] referred to in clause (a) of sub-section (1) or five 

years referred to in sub-section (4) 3[* * *], as the case may be.] 

(9)  Where  any  appellate  authority  or  tribunal  or  court  concludes  that  the  notice  issued  under                                     

sub-section  (4)  is  not  sustainable  for  the  reason  that  the  charges  of  fraud  or  collusion  or  any  wilful 

misstatement or suppression of facts or contravention of any of the provisions of this Act or of the rules 

made thereunder with intent to evade payment of duty has not been established against the person to whom 

the notice was issued, the Central Excise Officer shall determine the duty of excise payable by such person 

for the period of 5[two years], deeming as if the notice were issued under clause (a) of sub-section (1). 

(10) The  Central  Excise  Officer  shall, after  allowing  the  concerned  person  an  opportunity  of  being 

heard, and after considering the representation, if any, made by such person, determine the amount of duty 

of excise due from such person not being in excess of the amount specified in the notice. 

(11) The Central Excise Officer shall determine the amount of duty of excise under sub-section (10)— 

(a) within six months from the date of notice where it is possible to do so, in respect of cases falling 

under sub-section (1); 

(b) within 5[two years] from the date of notice, where it is possible to do so,  in respect of cases 

falling under sub-section (4) 1[* * *]. 

(12) Where the appellate authority or tribunal or court modifies the amount of duty of excise determined 

by the Central Excise Officer under sub-section (10), then the amount of penalties and interest under this 

section shall stand modified accordingly, taking into account the amount of duty of excise so modified. 

1. Sub-section (7) omitted by Act 20 of 2015, s. 93(i). 
2. Ins. by Act 17 of 2013, s. 91. 
3. The words “or sub-section (5)” omitted by Act 20 of 2015, s. 93(ii). 
4. Subs. by Act 23 of 2012, s. 135(b), for sub-section 8. 
5. Subs. by Act 28 of 2016, s. 143, for “one year”. 

28 

 
                                                           
(13) Where the amount as modified by the appellate authority or tribunal or court is more than the 

amount determined under sub-section (10) by the Central Excise Officer, the time within which the interest 

or penalty is payable under this Act shall be counted from the date of the order of the appellate authority or 

tribunal or court in respect of such increased amount. 

(14) Where an order determining the duty of excise is passed by the Central Excise Officer under this 

section, the person liable to pay the said duty of excise shall pay the amount so determined along with the 

interest due on such amount whether or not the amount of interest is specified separately. 

(15) The provisions of sub-sections (1) to (14) shall apply, mutatis mutandis, to the recovery of interest 

where interest payable has not been paid or part paid or erroneously refunded. 

Explanation 1.— For the purposes of this section and Section 11-AC,— 

(a)  “refund”  includes  rebate  of  duty  of  excise  on  excisable  goods  exported  out  of  India  or  on 

excisable materials used in the manufacture of goods which are exported out of India; 

(b) “relevant date” means,— 

(i) in the case of excisable goods on which duty of excise has not been levied or paid or has 
been short-levied or short-paid, and no periodical return as required by the provisions of this Act 
has been filed, the last date on which such return is required to be filed under this Act and the rules 
made thereunder; 

(ii) in the case of excisable goods on which duty of excise has not been levied or paid or has 
been short-levied or short-paid and the return has been filed 1[* * *], the date on which such return 
has been filed; 

(iii) in any other case, the date on which duty of excise is required to be paid under this Act or 

the rules made thereunder; 

(iv) in a case where duty of excise is provisionally assessed under this Act or the rules made 

thereunder, the date of adjustment of duty after the final assessment thereof; 

(v) in the case of excisable goods on which duty of excise has been erroneously refunded, the 

date of such refund; 

2[(vi) in the case where only interest is to be recovered, the date of payment of duty to which 

such interest relates.] 

(c) 3[* * *] 

1. The words “on due date” omitted by Act 20 of 2015, s. 93(iii)(A). 
2. Ins. by ibid, s. 93(iii)(B). 
3. Omitted by ibid, s. 93(iii)(C). 

29 

 
                                                           
1[Explanation  2.—  For  the  removal  of  doubts,  it  is  hereby  declared  that  any  non-levy,  short-levy,                  

non-payment, short-payment or erroneous refund where no show cause notice has been issued before the 

date on which the Finance Bill, 2015 receives the assent of the President, shall be governed by the provisions 

of Section 11A as amended by the Finance Act, 2015.] 

2[(16) The provisions of this section shall not apply to a case where the liability of duty not paid or 

short-paid is self-assessed and declared as duty payable by the assessee in the periodic returns filed by him, 

and in such case, recovery of non-payment or short-payment of duty shall be made in such manner as may 

be prescribed.]] 

3[11AA.  Interest  on  delayed  payment  of  duty.—  (1)  Notwithstanding  anything  contained  in  any 

judgment, decree, order or direction of the Appellate Tribunal or any court or in any other provision of this 

Act or the rules made thereunder, the person, who is liable to pay duty, shall, in addition to the duty, be 

liable to pay interest at the rate specified in sub-section (2), whether such payment is made voluntarily or 

after determination of the amount of duty under Section 11A. 

(2) Interest, at such rate not below ten per cent, and not exceeding thirty-six per cent per annum, as the 

Central  Government  may,  by  notification  in  the  Official  Gazette,  fix,  shall  be  paid  in  terms  of                  

Section 11A after the due date by the person liable to pay duty and such interest shall be calculated from 

the date on which such duty becomes due up to the date of actual payment of the amount due. 

(3) Notwithstanding anything contained in sub-section (1), no interest shall be payable where,— 

(a) the duty becomes payable consequent to the issue of an order, instruction or direction by the 

Board under Section 37-B; and 

(b) such amount of duty is voluntarily paid in full, within forty-five days from the date of issue of 
such order, instruction or direction, without reserving any right to appeal against the said payment at 
any subsequent stage of such payment.] 

4[11AC. Penalty for short-levy or non-levy of duty in certain cases.— (1) The amount of penalty 

for non-levy or short-levy or non-payment or short-payment or erroneous refund shall be as follows— 

(a) where any duty of excise has not been levied or paid or has been short-levied or short-paid or 

erroneously  refunded,  for  any  reason  other  than  the  reason  of  fraud  or  collusion  or  any  wilful                               
mis-statement or suppression of facts or contravention of any of the provisions of this Act or of the 
rules made thereunder with intent to evade payment of duty, the person who is liable to pay duty as 

1. Subs. by Act 20 of 2015, s. 93(iv). 
2. Ins. by ibid, s. 93(iv).  
3. Subs. by Act 8 of 2011, s. 64, for Section 11-AA and 11-AB.   
4.  Subs. by Act 20 of 2015, s. 94, for “11-AC”. 

30 

 
                                                           
determined under sub-section (10) of Section 11-A shall also be liable to pay a penalty not exceeding 
ten per cent of the duty so determined or Rupees Five thousand, whichever is higher: 

Provided that where such duty and interest payable under Section 11-AA is paid either before 
the issue of show cause notice or within thirty days of issue of show cause notice, no penalty shall 
be payable by the person liable to pay duty or the person who has paid the duty and all proceedings 
in respect of said duty and interest shall be deemed to be concluded; 

(b) where any duty as determined under sub-section (10) of Section 11A and the interest payable 
thereon under Section 11AA in respect of transactions referred to in clause (a) is paid within thirty days 
of the date of communication of the order of the Central Excise Officer who has determined such duty, 
the amount  of penalty  liable to  be  paid by  such person  shall be twenty-five  per  cent of  the  penalty 
imposed, subject to the condition that such reduced penalty is also paid within the period so specified; 

(c) where any duty of excise has not been levied or paid or has been short-levied or short-paid or 
erroneously  refunded,  by  reason  of fraud  or  collusion  or  any  wilful  misstatement  or  suppression  of 
facts, or contravention of any of the provisions of this Act or of the rules made thereunder with intent 
to evade payment of duty, the person who is liable to pay duty as determined under sub-section (10) of 
Section 11A shall also be liable to pay a penalty equal to the duty so determined: 

Provided that in respect of the cases where the details relating to such transactions are recorded 
in the specified record for the period beginning with the 8th April, 2011 up to the date on which 
the Finance Bill, 2015 receives the assent of the President (both days inclusive), the penalty shall 
be fifty per cent of the duty so determined; 

(d)  where  any  duty  demanded  in  a  show  cause  notice  and  the  interest  payable  thereon  under                

Section 11AA, issued in respect of transactions referred to in clause (c), is paid within thirty days of 
the communication of show cause notice, the amount of penalty liable to be paid by such person shall 
be fifteen per cent. of the duty demanded, subject to the condition that such reduced penalty is also paid 
within the period so specified and all proceedings in respect of the said duty, interest and penalty shall 
be deemed to be concluded; 

(e) where any duty as determined under sub-section (10) of Section 11A and the interest payable 
thereon under Section 11AA in respect of transactions referred to in clause (c) is paid within thirty days 
of the date of communication of the order of the Central Excise Officer who has determined such duty, 
the amount of penalty liable to be paid by such person shall be twenty-five per cent of the duty so 
determined, subject to the condition that such reduced penalty is also paid within the period so specified. 

(2) Where the appellate authority or tribunal or court modifies the amount of duty of excise determined 

by the Central Excise Officer under sub-section (10) of Section 11A, then, the amount of penalty payable 

under  clause  (c)  of  sub-section  (1)  and  the  interest  payable  under  Section  11AA  shall  stand  modified 

accordingly and after taking into account the amount of duty of excise so modified, the person who is liable 

31 

 
to pay duty as determined under sub-section (10) of Section 11A shall also be liable to pay such amount of 

penalty and interest so modified. 

(3) Where the amount of duty or penalty is increased by the appellate authority or tribunal or court over 

the amount determined under sub-section (10) of Section 11A by the Central Excise Officer, the time within 

which the interest and the reduced penalty is payable under clause (b) or clause (e) of sub-section (1) in 

relation  to  such  increased  amount  of  duty  shall  be  counted  from  the  date  of  the  order  of  the  appellate 

authority or tribunal or court. 

Explanation 1.— For the removal of doubts, it is hereby declared that— 

(i) any case of non-levy, short-levy, non-payment, short-payment or erroneous refund where no 
show cause notice has been issued before the date on which the Finance Bill, 2015 receives the assent 
of the President shall be governed by the provisions of Section 11AC as amended by the Finance Act, 
2015; 

(ii) any case of non-levy, short-levy, non-payment, short-payment or erroneous refund where show 
cause notice has been issued but an order determining duty under sub-section (10) of Section 11-A has 
not been passed before the date on which the Finance Bill, 2015 receives the assent of the President, 
shall  be  eligible  to  closure  of  proceedings  on  payment  of  duty  and  interest  under  the  proviso  to                      
clause  (a)  of  sub-section  (1)  or  on  payment  of  duty,  interest  and  penalty  under  clause  (d)  of                     
sub-section (1), subject to the condition that the payment of duty, interest and penalty, as the case may 
be, is made within thirty days from the date on which the Finance Bill, 2015 receives the assent of the 
President; 

(iii) any case of non-levy, short-levy, non-payment, short-payment or erroneous refund where an 
order determining duty under sub-section (10) of Section 11-A is passed after the date on which the 
Finance Bill, 2015 receives the assent of the President shall be eligible to payment of reduced penalty 
under clause  (b)  or  clause (e) of sub-section  (1), subject to the condition that  the  payment  of  duty, 
interest and penalty is made within thirty days of the communication of the order. 

Explanation 2.— For the purposes of this section, the expression “specified records” means records 

maintained by the person chargeable with the duty in accordance with any law for the time being in force 

and includes computerised records.] 

1[11B.  Claim  for  refund  of 2[duty  and  interest,  if  any,  paid  on  such  duty].—  (1)  Any  person 
claiming refund of any 3[duty of excise and interest, if any, paid on such duty] may make an application for 

refund of such  2[duty and interest, if any, paid on such duty] to the Assistant  4[Principal Commissioner of 

1. Ins. by Act 25 of 1978, s. 21, (w.e.f. 1-8-1978). 
2. Subs. by Act 18 of 2008, s. 80(i)(b), for “duty” (w.e.f. 10-5-2008). 
3. Subs. by ibid, s. 80(i)(a), for “duty of excise”. 
5. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 

32 

 
                                                           
Central  Excise  or  Commissioner  of  Central  Excise] 1[or  Deputy 2[Principal  Commissioner  of  Central 
Excise or Commissioner of Central Excise]] before the expiry of 3[two years] 4[from the relevant date] 5[in 

such  form   6[and  manner]]  as  may  be  prescribed  and  the  application  shall  be  accompanied  by  such 

documentary or other evidence (including the documents referred to in Section 12-A) as the applicant may 

furnish to establish that the amount of 7[duty of excise and interest, if any, paid on such duty] in relation to 
which such refund is claimed was collected from, or paid by, him and the incidence of such 8[duty and 

interest, if any, paid on such duty] had not been passed on by him to any other person: 

Provided that  where  an  application for  refund  has  been  made  before the  commencement  of  the 
Central Excises and Customs Laws (Amendment) Act, 1991, such application shall be deemed to have 
been  made  under  this  sub-section  as  amended  by  the  said  Act  and  the  same  shall  be  dealt  with  in 
accordance with the provisions of sub-section (2) as substituted by that Act:] 

9[Provided further that] the limitation of  10[two years] shall not apply where any 7[duty and interest, 

if any, paid on such duty] has been paid under protest. 

11[* * *] 

12[(2) If, on receipt of any such application, the Assistant 2[Principal Commissioner of Central Excise 

or  Commissioner  of  Central  Excise] 13[or  Deputy 2[Principal  Commissioner  of  Central  Excise  or 
Commissioner of Central Excise]] is satisfied that the whole or any part of the 1[duty of excise and interest, 

if any, paid on such duty] paid by the applicant is refundable, he may make an order accordingly and the 

amount so determined shall be credited to the Fund: 

Provided that the amount of 1[duty of excise and interest, if any, paid on such duty] as determined 
by  the  Assistant   2[Principal  Commissioner  of  Central  Excise  or  Commissioner  of  Central  Excise]         
13[or Deputy  2[Principal Commissioner of Central Excise or Commissioner of Central Excise]] under 
the foregoing provisions of this sub-section shall, instead of being credited to the Fund, be paid to the 
applicant, if such amount is relatable to— 

(a) rebate of duty of excise on excisable goods exported out of India or on excisable materials used 

in the manufacture of goods which are exported out of India; 

1.  Ins. by Act 27 of 1999, s. 119. 
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
3. Subs. by Act 28 of 2016, s. 143, for “one year”. 
4. Subs. by Act 44 of 1980, s. 49, for “from the date of payment of duty”. 
5. Ins. by Act 40 of 1991, s. 3(b) (w.e.f. 20-9-1991). 
6. Ins. by Act 22 of 1995, s. 74. 
7. Subs. by Act 18 of 2008, s. 80(i)(a), for “duty of excise”. 
8. Subs. by ibid, s. 80(i)(b), for “duty”. 
9. Ins. by Act 40 of 1991, s. 3 (w.e.f. 20-9-1991). 
10. Subs. by Act 28 of 2016, s. 143, for “one year”. 
11. Explanation to sub-section (1) omitted by Act 44 of 1980, s. 49. 
12. Subs. by Act 40 of 1991, s. 3 (w.e.f. 20-9-1991). 
13. Ins. by Act 27 of 1999, s. 119. 

33 

 
                                                           
(b) unspent advance deposits lying in balance in the applicant's account current maintained with 

the 7[Principal Commissioner of Central Excise or Commissioner of Central Excise]; 

(c) refund of credit of duty paid on excisable goods used as inputs in accordance with the rules 

made, or any notification issued, under this Act; 

(d) the 1[duty of excise and interest, if any paid on such duty] paid by the manufacturer, if he had 
not passed on the incidence of such 2[duty and interest, if any, paid on such duty] to any other person; 

(e) the   1[duty of excise and interest, if any paid on such duty] borne by the buyer, if he had not 

passed on the incidence of such  2[duty and interest, if any, paid on such duty] to any other person; 

 (f) the   1[duty of excise and interest, if any paid on such duty] borne by any other such class of 

applicants as the Central Government may, by notification in the Official Gazette, specify: 

Provided further that no notification under clause (f) of the first proviso shall be issued unless 
in the opinion of the Central Government the incidence of 2[duty and interest, if any, paid on such 
duty] has not been passed on by the persons concerned to any other person. 

(3) Notwithstanding anything to the contrary contained in any judgment, decree, order or direction of 

the Appellate Tribunal or any Court or in any other provision of this Act or the rules made thereunder or 

any other law for the time being in force, no refund shall be made except as provided in sub-section (2). 

(4) Every notification under clause (f) of the first proviso to sub-section (2) shall be laid before each 

House of Parliament, if it is sitting, as soon as may be after the issue of the notification, and, if it is not 

sitting,  within  seven  days  of  its  reassembly,  and  the  Central  Government  shall  seek  the  approval  of 

Parliament to the notification by a resolution moved within a period of fifteen days beginning with the day 

on which the notification is so laid before the House of the People and if Parliament makes any modification 

in the notification or directs that the notification should cease to have effect, the notification shall thereafter 

have effect only in such modified form or be of no effect, as the case may be, but without prejudice to the 

validity of anything previously done thereunder. 

(5) For the removal of doubts, it is hereby declared that any notification issued under clause (f) of the 

first proviso to sub-section (2), including any such notification approved or modified under sub-section (4), 

may be rescinded by the Central Government at any time by notification in the Official Gazette.] 

3[Explanation.— For the purposes of this section,— 

(A)  “refund”  includes  rebate  of  duty  of  excise  on  excisable  goods  exported  out  of  India  or  on 

excisable materials used in the manufacture of goods which are exported out of India; 

1. Subs. by Act 18 of 2008, s. 80(ii)(a), for “duty of excise”. 
2. Subs. by ibid, s. 80(ii)(b), for “duty”. 
3. Subs. by Act 44 of 1980, s. 49, for the Explanation. 

34 

 
                                                           
(B) “relevant date” means,— 

(a) in the case of goods exported out of India where a refund of excise duty paid is available in 
respect  of  the  goods  themselves  or,  as  the  case  may  be,  the  excisable  materials  used  in  the 
manufacture of such goods,— 

(i) if the goods are exported by sea or air, the date on which the ship or the aircraft in which 

such goods are loaded, leaves India, or 

(ii) if the goods are exported by land, the date on which such goods pass the frontier, or 

(iii)  if  the  goods  are  exported  by  post,  the  date  of  despatch  of  goods  by  the  Post  Office 

concerned to a place outside India; 

(b) in the case of goods returned for being remade, refined, reconditioned, or subjected to any other 

similar process, in any factory, the date of entry into the factory for the purposes aforesaid; 

(c)  in  the  case  of  goods  to  which  banderols  are  required  to  be  affixed  if  removed  for  home 
consumption but not so required when exported outside India, if returned to a factory after having been 
removed from such factory for export out of India, the date of entry into the factory; 

(d) in a case where a manufacturer is required to pay a sum, for a certain period, on the basis of the 
rate fixed by the Central Government by notification in the Official Gazette in full discharge of his 
liability for the duty leviable on his production of certain goods, if after the manufacturer has made the 
payment on the basis of such rate for any period but before the expiry of that period such rate is reduced, 
the date of such reduction; 

1[(e) in the case of a person, other than the manufacturer, the date of purchase of the goods by such 

person;] 

2[(ea) in the case of goods which are exempt from payment of duty by a special order issued under 

sub-section (2) of Section 5-A, the date of issue of such order;] 

3[(eb) in case where duty of excise is paid provisionally under this Act or the rules made thereunder, 

the date of adjustment of duty after the final assessment thereof;] 

4[(ec) in case where the duty becomes refundable as a consequence of judgment, decree, order or 
direction of appellate authority, Appellate Tribunal or any court, the date of such judgment, decree, 
order or direction;] 

(f) in any other case, the date of payment of duty.] 

1. Subs. by Act 40 of 1991, s. 3(c), for sub clause (e) (w.e.f. 20-9-1991). 
2. Ins. by Act 33 of 1996, s. 77. 
3. Ins. by Act 21 of 1998, s. 108. 
4. Ins. by Act 22 of 2007, s. 117. 

35 

 
                                                           
1[11-BB. Interest on delayed refunds.— If any duty ordered to be refunded under sub-section (2) of 

Section 11-B to any applicant is not refunded within three months from the date of receipt of application 

under  sub-section  (1)  of  that  section,  there  shall  be  paid  to  that  applicant  interest  at  such  rate,  2[not 
below  five per cent and not exceeding thirty per cent per annum as is for the time being fixed 3[by the 

Central Government, by notification in the Official Gazette,]] on such duty from the date immediately after 

the expiry of three months from the date of receipt of such application till the date of refund of such duty: 

Provided  that  where  any  duty  ordered  to  be  refunded  under  sub-section  (2)  of  Section  11-B  in 
respect of an application under sub-section (1) of that section made before the date on which the Finance 
Bill, 1995 receives the assent of the President, is not refunded within three months from such date, there 
shall be paid to the applicant interest under this section from the date immediately after three months 
from such date, till the date of refund of such duty. 

Explanation.—  Where  any  order  of  refund  is  made  by  the  Commissioner  (Appeals),  Appellate 
Tribunal 4[National Tax Tribunal] or any court against an order of the Assistant 5[Principal Commissioner 

of Central Excise or Commissioner of Central Excise] 6[or Deputy   5[Principal Commissioner of Central 

Excise or Commissioner of Central Excise]], under sub-section (2) of Section 11-B, the order passed by the 

Commissioner (Appeals), Appellate Tribunal 4[, National Tax Tribunal] or, as the case may be, by the court 

shall be deemed to be an order passed under the said sub-section (2) for the purposes of this section.] 

7[11C.  Power  not  to  recover  duty  of  excise  not  levied  or  short-levied  as  a  result  of  general 

practice.—  8[(1)] Notwithstanding anything contained in this Act, if the Central Government is satisfied— 

(a) that a practice was, or is, generally prevalent regarding levy of duty of excise (including non-

levy thereof) on any excisable goods; and 

(b) that such goods were, or are, liable— 

(i) to duty of excise, in cases where according to the said practice the duty was not, or is not 

being, levied, or 

(ii) to a higher amount of duty of excise than what was, or is being, levied, according to the 

said practice, 

then, the Central Government may, by notification in the Official Gazette direct that the whole of the 

duty of excise payable on such goods, or, as the case may be, the duty of excise in excess of that payable 

1. Ins. by Act 22 of 1995, s. 75. 
2. Subs. by Act 14 of 2001, s. 126, for “not below ten per cent” (w.e.f. 11-5-2001). 
3. Subs. by Act 10 of 2000, s. 102, for “by the Board”. 
4. Ins. by Act 49 of 2005, s. 30 and Sch. (Pt. VII) (w.e.f. 28-12-2005). 
5. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
6. Ins. by Act 27 of 1999, s. 119. 
7. Ins. by Act 25 of 1978, s. 21, (w.e.f. 1-7-1978). 
8. Renumbered as sub-sec. (1) and sub-sec. (2) inserted by Act 29 of 1988, s. 10 (w.e.f. 1-7-1988). 

36 

 
                                                           
on such goods, but for the said practice, shall not be required to be paid in respect of the goods on which 

the duty of excise was not, or is not being, levied, or was, or is being, short-levied, in accordance with the 

said practice.] 

1[(2) Where any notification under sub-section (1) in respect of any goods has been issued, the whole 

of the duty of excise paid on such goods or, as the case may be, the duty of excise paid in excess of that 

payable on such goods, which would not have been paid if the said notification had been in force, shall be 

dealt with in accordance with the provisions of sub-section (2) of Section 11-B: 

Provided that the person claiming the refund of such duty or, as the case may be, excess duty, makes 
an  application  in  this  behalf  to  the  Assistant 2[Principal  Commissioner  of  Central  Excise  or 
Commissioner  of  Central  Excise] 3[or  Deputy 2[Principal  Commissioner  of  Central  Excise  or 
Commissioner of Central Excise]], in the form referred to in sub-section (1) of Section 11-B, before 
the expiry of six months from the date of issue of the said notification.] 

4[11D. Duties of excise collected from the buyer to be deposited with the Central Government.— 

(1) Notwithstanding anything to the contrary contained in any order or direction of the Appellate Tribunal 
or any Court or in any other provision of this Act or the rules made thereunder, 5[every person who is liable 

to pay duty under this Act or the rules made thereunder, and has collected any amount in excess of the duty 

assessed or determined and paid on any excisable goods under this Act or the rules made thereunder from 

the buyer of such goods] in any manner as representing duty of excise, shall forthwith pay the amount so 

collected to the credit of the Central Government. 

6[(1A) Every person, who has collected any amount in excess of the duty assessed or determined and 

paid on any excisable goods or has collected any amount as representing duty of excise on any excisable 

goods which are wholly exempt or are chargeable to nil rate of duty from any person in any manner, shall 

forthwith pay the amount so collected to the credit of the Central Government.] 

7[(2) Where any amount is required to be paid to the credit of the Central Government under 8[sub-

section (1) or sub-section (1-A), as the case may be,] and which has not been so paid, the Central Excise 

Officer may serve, on the person liable to pay such amount, a notice requiring him to show cause why the 

said amount, as specified in the notice, should not be paid by him to the credit of the Central Government.] 

1. Subs. by Act 40 of 1991, s. 4, for sub-section (2) (w.e.f. 20-9-1991). 
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
3. Ins. by Act 27 of 1999, s. 119. 
4. Ins. by Act 40 of 1991, s. 5 (w.e.f. 20-9-1991). 
5. Subs. by Act 10 of 2000, s. 103, for certain words (w.r.e.f. 20-9-1991). 
6. Ins. by Act 18 of 2008, s. 81(i). 
7. Subs. by Act 10 of 2000, s. 103, for sub-section (2) (w.r.e.f. 20-9-1991). 
8. Subs. by Act 18 of 2008, s. 81(ii), for the word, brackets and figure “sub-section (1)”. 

37 

 
                                                           
(3) The Central Excise Officer shall, after considering the representation, if any, made by the person 

on whom the notice is served under sub-section (2), determine the amount due from such person (not being 

in  excess  of  the  amount  specified  in  the  notice)  and  thereupon  such  person  shall  pay  the  amount  so 

determined. 

(4) The amount paid to the credit of the Central Government under 1[sub-section (1) or sub-section                

(1A) or sub-section (3), as the case may be,] shall be adjusted against the duty of excise payable by the 

person on finalisation of assessment or any other proceeding for determination of the duty of excise relating 

to the excisable goods referred to in 2[sub-section (1) and sub-section (1A)]. 

(5) Where any surplus is left after the adjustment under sub-section (4), the amount of such surplus 

shall  either  be  credited  to  the  Fund  or,  as  the  case  may  be,  refunded  to  the  person  who  has  borne  the 

incidence of such amount, in accordance with the provisions of Section 11B and such person may make an 

application under that section in such cases within six months from the date of the public notice to be issued 

by the Assistant 3[Principal Commissioner of Central Excise or Commissioner of Central Excise] for the 

refund of such surplus amount.]] 

4[11DD. Interest on the amounts collected in excess of the duty.— (1) Where an amount has been 

collected in excess of the duty assessed or determined and paid on any excisable goods under this Act or 
the  rules  made  thereunder  from  the 5[buyer  of  such  goods  or  from  any  person  or  where  a  person  has 

collected any amount as representing duty of excise on any excisable goods which are wholly exempt or 

are  chargeable  to  nil  rate  of  duty,  the  person]  who  is  liable  to  pay  such  amount  as  determined  under                       

sub-section (3) of Section 11-D, shall, in addition to the amount, be liable to pay interest at such rate not 

below ten per cent, and not exceeding thirty-six percent per annum, as is for the time being fixed by the 

Central Government, by notification in the Official Gazette, from the first day of the month succeeding the 

month in which the amount ought to have been paid under this Act, but for the provisions contained in              

sub-section (3) of Section 11-D, till the date of payment of such amount: 

Provided that in such cases where the amount becomes payable consequent to issue of an order, 
instruction or direction by the Board under Section 37B, and such amount payable is voluntarily paid 
in  full,  without  reserving  any  right  to  appeal against  such  payment  at  any  subsequent stage,  within   
forty-five days from the date of issue of such order, instruction or direction, as the case may be, no 
interest shall be payable and in other cases the interest shall be payable on the whole amount, including 
the amount already paid. 

1. Subs. by Act 18 of 2008, s. 81(iii)(a), for the word, brackets and figure “sub-section (1) or sub-section (3)”. 
2. Subs. by ibid, s. 81(iii)(b), for the word, brackets and figure “sub-section (1)”. 
3. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
4. Ins. by Act 32 of 2003, s. 140 (w.e.f. 14-5-2003).  
5. Subs. by Act 18 of 2008, s. 82, for the words “buyer of such goods, the person”. 

38 

 
                                                           
(2) The provisions of sub-section (1) shall not apply to cases where the amount had become payable or 

ought to have been paid before the day on which the Finance Bill, 2003 receives the assent of the President. 

Explanation 1.— Where the amount determined under sub-section (3) of Section 11-D is reduced by 

the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, the interest payable 

thereon under sub-section (1) shall be on such reduced amount. 

Explanation 2.—Where the amount determined under sub-section (3) of Section 11-D is increased by 

the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, the interest payable 

thereon under sub-section (1) shall be on such increased amount.] 

1[11DDA.  Provisional  attachment  to  protect  revenue  in  certain  cases.—  (1)  Where,  during  the 

pendency of any proceedings under Section 11A or Section 11D, the Central Excise Officer is of the opinion 

that for the purpose of protecting the interests of revenue, it is necessary so to do, he may, with the previous 

approval of the 2[Principal Commissioner of Central Excise or Commissioner of Central Excise], by order 
in writing, attach provisionally any property belonging to the person on whom notice is served under 3[* * 

*] Section 11A or sub-section (2) of Section 11D, as the case may be, in accordance with the rules made in 

this behalf under Section 142 of the Customs Act, 1962 (52 of 1962). 

(2)  Every  such  provisional  attachment  shall  cease  to  have  effect  after  the  expiry  of  a  period  of  six 

months from the date of the order made under sub-section (1): 

Provided  that  the 4[Principal  Chief  Commissioner  of  Central  Excise  or  Chief  Commissioner  of 
Central Excise] may, for reasons to be recorded in writing, extend the aforesaid period by such further 
period or periods as he thinks fit, so, however, that the total period of extension shall not in any case 
exceed two years: 

Provided further that where an application for settlement of case under Section 32-E is made to the 
Settlement Commission, the period commencing from the date on which such application is made and 
ending with the date on which an order under sub-section (1) of Section 32-F is made shall be excluded 
from the period specified in the preceding proviso.] 

5[11E. Liability under Act to be first charge.— Notwithstanding anything to the contrary contained 

in any Central Act or State Act, any amount of duty, penalty, interest, or any other sum payable by an 

assessee or any other person under this Act or the rules made thereunder shall, save as otherwise provided 

in Section 529A of the Companies Act, 1956 (1 of 1956), the Recovery of Debts Due to Banks and the 

1. Ins. by Act 29 of 2006, s. 36. 
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
3. The words “sub-section (1) of” omitted by Act 17 of 2013, s. 92. 
4. Subs. by Act 25 of 2014, s. 95, for “Chief Commissioner of Central Excise” 
5. Ins. by Act 8 of 2011, s. 66. 

39 

 
                                                           
Financial Institutions Act, 1993 (51 of 1993) 1[the Securitisation and Reconstruction of Financial Assets 

and the Enforcement of Security Interest Act, 2002 (54 of 2002) and the Insolvency and Bankruptcy Code, 

2016], be the first charge on the property of the assessee or the person, as the case may be.] 

12.  Application  of  the  provisions  of  Act 2[52  of  1962] to  Central  Excise  Duties.—  The  Central 
Government may, by notification in the Official Gazette, declare that any of the provisions of the 3[Customs 

Act, 1962 (52 of 1962)], relating to the levy of and exemption from customs duties, drawback of duty, 

warehousing, offences and penalties, confiscation, and procedure relating to offences and appeals shall, 

with  such  modifications  and  alterations  as  it  may  consider  necessary  or  desirable  to  adapt  them  to  the 

circumstances,  be  applicable  in  regard  to  like  matters  in  respect  of  the  duties  imposed  by                                   

Section 3 4[Section 3-A]: 

5[Provided that the provisions of the Customs Act, 1962(52 of 1962) relating to offences and penalties 

shall not apply for the matters covered by section 3A for the period beginning on the 10th day of May, 2008 

and ending immediately before the day on which the Finance Bill, 2011 receives the assent of the President.] 

6[CHAPTER IIA 

INDICATING AMOUNT OF DUTY IN THE PRICE OF GOODS, ETC., FOR PURPOSE OF REFUND 

AND CREDITING CERTAIN AMOUNTS TO THE FUND 

12A.  Price  of  goods  to  indicate  the  amount  of  duty  paid  thereon.—  Notwithstanding  anything 

contained in this Act or any other law for the time being in force, every person who is liable to pay duty of 

excise on any goods shall, at the time of clearance of the goods, prominently indicate in all the documents 

relating to assessment, sales invoice, and other like documents, the amount of such duty which will form 

part of the price at which such goods are to be sold. 

12B. Presumption that the incidence of duty has been passed on to the buyer.— Every person who 

has paid the duty of excise on any goods under this Act shall, unless the contrary is proved by him, be 

deemed to have passed on the full incidence of such duty to the buyer of such goods. 

12C. Consumer Welfare Fund.— (1) There shall be established by the Central Government a fund, 

to be called the Consumer Welfare Fund. 

(2) There shall be credited to the Fund, in such manner as may be prescribed,— 

1. Subs. by Act 31 of 2016, s. 246 & Sch. II, for “and the Securitisation and Reconstruction of Financial Assets and the 

Enforcement of Security Interest Act, 2002 (54 of 2002)” (w.e.f. 1-11-2016). 

2. Subs. by Act 33 of 1996, s. 78,  
3. Subs. by ibid, s. 78, for “Sea Customs Act, 1878 (8 of 1878)”. 
4. Ins. by Act 8 of 2011, s. 67 (w.r.e.f. 10-5-2008). 
5. Ins. by ibid, s. 67 (w.e.f. 10-5-2008). 
6. Ins. by Act 40 of 1991, s. 6 (w.e.f. 20-9-1991). 

40 

 
                                                           
(a) the amount of duty of excise referred to in sub-section (2) of Section 11B or sub-section (2) of 

Section 11C or sub-section (2) of Section 11D; 

(b) the amount of duty of customs referred to in sub-section (2) of Section 27 or sub-section (2) of 

Section 28A, or sub-section (2) of Section 28B of the Customs Act, 1962 (52 of 1962); 

(c) any income from investment of the amount credited to the Fund and any other monies received 

by the Central Government for the purposes of this Fund; 

1[(d) the surplus amount referred to in sub-section (6) of Section 73A of the Finance Act, 1994 (32 

of 1994).] 

12D. Utilisation of the Fund.— (1) Any money credited to the Fund shall be utilised by the Central 

Government for the welfare of the consumers in accordance with such rules as that Government may make 

in this behalf. 

(2) The Central Government shall maintain or, if it thinks fit, specify the authority which shall maintain, 

proper  and  separate  account  and  other  relevant records  in  relation  to  the  Fund in  such  form  as  may  be 

prescribed in consultation with the Comptroller and Auditor-General of India.] 

CHAPTER III 

POWERS AND DUTIES OF OFFICERS AND LANDHOLDERS 

2 [ 3[12E.] Powers of Central Excise Officers.—(1) A Central Excise Officer may exercise the powers 

and discharge the duties conferred or imposed under this Act on any other Central Excise Officer who is 

subordinate to him. 

(2)  Notwithstanding  anything  contained in  sub-section  (1), the 4[Principal  Commissioner  of  Central 

Excise or Commissioner of Central Excise] (Appeals) shall not exercise the powers and discharge the duties 

conferred or imposed on a Central Excise Officer other than those specified in Section 14 or Chapter VI-

A.] 

5[12F.  Power  of  search  and  seizure.—  (1)  Where  the  Joint   4[Principal  Commissioner  of  Central 
Excise or Commissioner of Central Excise] or Additional 4[Principal Commissioner of Central Excise or 

Commissioner of Central Excise] or such other Central Excise Officer as may be notified by the Board has 

reasons to believe that any goods liable to confiscation or any documents or books or things, which in his 

opinion shall be useful for or relevant to any proceedings under this Act, are secreted in any place, he may 

1. Ins. by Act 21 of 2006, s. 64. 
2. Ins. by Act 79 of 1985, s. 4 (w.e.f. 27-12-1985). 
3. Section “12A” renumbered as “12E” by Act 40 of 1991, s. 7 (w.e.f. 20-9-1991). 
4. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
5. Ins. by Act 8 of 2011, s. 68. 

41 

 
                                                           
authorise in writing any Central Excise Officer to search and seize or may himself search and seize such 

documents or books or things. 

1[(2) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974), relating to search and seizure 

shall,  so  far  as  may  be,  apply  to  search  and  seizure  under  this  section  subject  to  the  modification  that                     

sub-section (5) of Section 165 of the said Code shall have effect as if for the word “Magistrate”, wherever 

it  occurs, the  words  “2[Principal  Commissioner  of  Central  Excise  or  Commissioner  of  Central  Excise]” 

were substituted.]] 

3[13. Power to arrest.— Any Central Excise Officer not below the rank of Inspector of Central Excise 

may, with the prior approval of the 2[Principal Commissioner of Central Excise or Commissioner of Central 

Excise], arrest any person whom he has reason to believe to be liable to punishment under this Act or the 

rules made thereunder.] 

(2) Any person accused or reasonably suspected of committing an offence under this Act or any rules 

made thereunder, who on demand of any officer duly empowered by the Central Government in this behalf 

refuses to give his name and residence, or who gives a name or residence which such officer has reason to 

believe to be false, may be arrested by such officer in order that his name and residence may be ascertained. 

14. Power to summon persons to give evidence and produce documents in inquiries under this 

Act.— (1) Any Central Excise Officer duly empowered by the Central Government in this behalf shall have 

power to summon any person whose attendance he considers necessary either to give evidence or to produce 

a document or any other thing in any inquiry which such officer is making for any of the purposes of this 

Act.  A  summons  to  produce  documents  or  other  things  may  be  for  the  production  of  certain  specified 

documents  or  things  or  for  the  production  of  all  documents  or  things  of  a  certain  description  in  the 

possession or under the control of the person summoned. 

(2) All persons so summoned shall be bound to attend, either in person or by an authorised agent, as 

such officer may direct; and all persons so summoned shall be bound to state the truth upon any subject 

respecting which they are examined or make statements and to produce such documents and other things 

as may be required: 

Provided that the exemptions under Sections 132 and 133 of the Code of Civil Procedure, 1908 (5 

of 1908) shall be applicable to requisitions of attendance under this section. 

(3) Every such inquiry as aforesaid shall be deemed to be a “judicial proceeding” within the meaning 

of Section 193 and Section 228 of the Indian Penal Code, 1860 (45 of 1860). 

1. Subs. by Act 23 of 2012, s. 137, for sub-section (2).  
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
3. Subs. by Act 32 of 2003, s. 141, for section 13 (w.e.f. 14-5-2003).  

42 

 
                                                           
1[14A.  Special  audit  in  certain  cases.—  (1)  If  at  any  stage  of  enquiry,  investigation  or  any  other 
proceedings  before  him,  any  Central  Excise  Officer  not  below  the  rank  of  an  Assistant 2[Principal 

Commissioner  of  Central  Excise  or  Commissioner  of  Central  Excise],  having  regard  to  the  nature  and 

complexity of the case and the interest of revenue, is of the opinion that the value has not been correctly 

declared  or  determined  by  a  manufacturer  or  any  person,  he  may,  with  the  previous  approval  of 
the 3[Principal Chief Commissioner of Central Excise or Chief Commissioner of Central Excise], direct 

such manufacturer or such person to get the accounts of his factory, office, depots, distributors or any other 
place, as may be specified by the said Central Excise Officer, audited by a 4[cost accountant or chartered 

accountant], nominated by the 2[Principal Chief Commissioner of Central Excise or Chief Commissioner 

of Central Excise] in this behalf. 

(2) The 4[cost accountant or chartered accountant], so nominated shall, within the period specified by 

the Central Excise Officer, submit a report of such audit duly signed and certified by him to the said Central 

Excise Officer mentioning therein such other particulars as may be specified: 

Provided that the Central Excise Officer may, on an application made to him in this behalf by the 
manufacturer or the person and for any material and sufficient reason, extend the said period by such 
further period or periods as he thinks fit; so, however, that the aggregate of the period originally fixed 
and the period or periods so extended shall not, in any case, exceed one hundred and eighty days from 
the date on which the direction under sub-section (1) is received by the manufacturer or the person. 

(3)  The  provisions  of  sub-section  (1)  shall  have  effect  notwithstanding  that  the  accounts  of  the 

manufacturer  or  person  aforesaid  have  been  audited under  any  other law for  the  time  being  in  force  or 

otherwise. 

(4) 5[* * *] 

(5)  The  manufacturer  or  the  person  shall  be  given  an  opportunity  of  being  heard  in  respect  of  any 

material gathered on the basis of audit under sub-section (1) and proposed to be utilised in any proceedings 

under this Act or rules made thereunder. 

6[Explanation 1].— For the purpose of this section, “cost accountant” shall have the meaning assigned 

to it in clause (b) of sub-section (1) of Section 2 of the Cost and Works Accountants Act, 1959 (23 of 

1959).] 

1. Ins. by Act 22 of 1995, s. 76 (w.e.f. 26-5-1995). 
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
3. Subs. by ibid, s. 95, for “Chief Commissioner of Central Excise”. 
4. Subs. by Act 33 of 2009, s. 105(i), for “cost accountant”. 
5. Omitted by Act 10 of 2000, s. 104. 
6. Renumbered by Act 33 of 2009, s. 105(ii). 

43 

 
                                                           
1[Explanation  2.—  For  the purposes  of this  section,  “chartered  accountant”  shall  have  the  meaning 

assigned to it in clause (b) of sub-section (1) of Section 2 of the Chartered Accountants Act, 1949 (38 of 

1949).] 

2[14AA. Special audit in cases where credit of duty availed or utilised is not within the normal 
limits, etc.— (1) If the 3[Principal Commissioner of Central Excise or Commissioner of Central Excise] 

has reason to believe that the credit of duty availed of or utilised under the rules made under this Act by a 

manufacturer of any excisable goods— 

(a) is not within the normal limits having regard to the nature of the excisable goods produced or 

manufactured, the type of inputs used and other relevant factors, as he may deem appropriate; 

(b)  has  been  availed  of  or  utilised  by  reason  of  fraud,  collusion  or  any  wilful  misstatement  or 

suppression of facts, 

he may direct such manufacturer to get the accounts of his factory, office, depot, distributor or any other 

place, as may be specified by him, audited by a 4[cost accountant or chartered accountant] nominated by 

him. 

(2) The 4[cost accountant or chartered accountant] so nominated shall, within the period specified by 

the 3[Principal Commissioner of Central Excise or Commissioner of Central Excise], submit a report of 

such  audit  duly  signed  and  certified  by  him  to  the  said  Commissioner  mentioning  therein  such  other 

particulars as may be specified. 

(3) The provisions of sub-section (1) shall have effect notwithstanding that the accounts of the said 

manufacturer aforesaid have been audited under any other law for the time being in force or otherwise. 

(4)  5[* * *] 

(5) The manufacturer shall be given an opportunity of being heard in respect of any material gathered 

on the basis of the audit under sub-section (1) and proposed to be utilised in any proceeding under this Act 

or rules made thereunder. 

6[Explanation 1.]— For the purpose of this section, “cost accountant” shall have the meaning assigned 

to it in clause (b) of sub-section (1) of Section 2 of the Cost and Works Accountants Act, 1959 (23 of 1959). 

1. Ins. by Act 33 of 2009, s. 105(ii). 
2. Ins. by Act 26 of 1997, s. 83. 
3. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
4. Subs. by Act 33 of 2009, s. 106(i), for “cost accountant”. 
5. Omitted by Act 10 of 2000, S. 105. 
6. Explanation renumbered by Act 33 of 2009, s. 106(i) & (ii). 

44 

 
                                                           
1[Explanation  2.—  For  the purposes  of this  section,  “chartered  accountant”  shall  have  the  meaning 

assigned to it in clause (b) of sub-section (1) of Section 2 of the Chartered Accountants Act, 1949 (38 of 

1949).] 

15. Officers required to assist Central Excise Officers.— All officers of Police and Customs and all 

officers  of  Government  engaged  in  the  collection  of  land  revenue,  and  all  village  officers  are  hereby 

empowered and required to assist the Central Excise Officers in the execution of this Act. 

2[15A. Obligation to furnish information return.— (1) Any person, being— 

(a) an assessee; or 

(b) a local authority or other public body or association; or 

(c) any authority of the State Government responsible for the collection of value added tax or 

sales tax; or 

(d) an income tax authority appointed under the provisions of the Income Tax Act, 1961 (43 of 

1961); or 

(e) a banking company within the meaning of clause (a) of Section 45-A of the Reserve Bank 

of India Act, 1934 (2 of 1934); or 

(f)  a  State  Electricity  Board  or an  electricity  distribution  or  transmission  licensee  under the 
Electricity Act, 2003 (36 of  2003), or any other entity entrusted, as the case may be, with such 
functions by the Central Government or the State Government; or 

(g) the Registrar or Sub-Registrar appointed under Section 6 of the Registration Act, 1908 (16 

of 1908); or 

(h) a Registrar within the meaning of the Companies Act, 2013 (18 of 2013); or 

(i)  the  registering  authority  empowered  to  register  motor  vehicles  under  Chapter  IV  of  the 

Motor Vehicles Act, 1988 (59 of 1988); or 

(j) the Collector referred to in clause (c) of Section 3 of the Right to Fair Compensation and 

Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (30 of 2013); or 

(k)  the  recognised  stock  exchange  referred  to  in  clause  (f)  of  Section  2  of  the  Securities 

Contracts (Regulation) Act, 1956 (42 of 1956); or 

(l) a depository referred to in clause (e) of sub-section (1) of Section 2 of the Depositories Act, 

1996 (22 of 1996); or 

1. Ins. by Act 33 of 2009, s. 106(i) & (ii). 
2. Ins. by Act 25 of 2014, s. 97. 

45 

 
                                                           
(m) an officer of the Reserve Bank of India, constituted under Section 3 of the Reserve Bank 

of India Act, 1934 (2 of 1934), 

who is responsible for maintaining record of registration or statement of accounts or any periodic return 

or document containing details of payment of tax and other details or transaction of goods or services or 

transactions  related  to  a  bank  account  or  consumption  of  electricity  or  transaction  of  purchase,  sale  or 

exchange of goods or property or right or interest in a property, under any law for the time being in force, 

shall furnish an information return of the same in respect of such periods, within such time, form (including 

electronic form) and manner, to such authority or agency as may be prescribed. 

(2) Where the prescribed authority considers that the information submitted in the information return 

is defective, he may intimate the defect to the person who has furnished such information return and give 

him an opportunity of rectifying the defect within a period of thirty days from the date of such intimation 

or within such further period which, on an application made in this behalf, the prescribed authority may 

allow and if the defect is not rectified within the said period of thirty days or, as the case may be, the further 

period  so  allowed,  then,  notwithstanding  anything  contained  in  any  other  provision  of  this  Act,  such 

information return shall be treated as not submitted and the provisions of this Act shall apply. 

(3) Where a person who is required to furnish information return has not furnished the same within the 

time specified in sub-section (1) or sub-section (2), the prescribed authority may serve upon him a notice 

requiring furnishing of such information return within a period not exceeding ninety days from the date of 

service of the notice and such person shall furnish the information return.] 

1[15B. Penalty for failure to furnish information return.— If a person who is required to furnish an 

information return under Section 15-A fails to do so within the period specified in the notice issued under 

sub-section (3) thereof, the prescribed authority may direct that such person shall pay, by way of penalty, a 

sum  of  one  hundred  rupees  for  each  day  of  the  period  during  which  the  failure  to  furnish  such  return 

continues.] 

16.  [Owners  or  occupiers  of 

land  to  report  manufacture  of  contraband  excisable 

goods].— Omitted by Finance Act 2002 (20 of 2002), s. 137.  

17. [Punishment for connivance at offences].— Omitted by s. 137, ibid 

18. [Searches and arrests how to be made].— All searches made under this Act or any rules made 

thereunder and all arrests made under this Act shall be carried out in accordance with the provisions of the 

Code of Criminal Procedure, 1898 (5 of 1898)2, relating respectively to searches and arrests made under 

that Code. 

1. Ins. by Act 25 of 2014, S. 97. 
2. See now the CrPC, 1973 (2 of 1974). 

46 

 
                                                           
19. Disposal of persons arrested.— Every person arrested under this Act shall be forwarded without 

delay to the nearest Central Excise Officer empowered to send persons so arrested to a Magistrate, or, if 

there is no such Central Excise Officer within a reasonable distance, to the officer-in-charge of the nearest 

police station. 

20. Procedure to be followed by officer-in-charge of police station.— The officer-in-charge of a 

police  station  to  whom  any  person  is  forwarded  under  Section  19 1[shall,  where  the  offence  is  non-

cognizable, either admit him] to bail to appear before the Magistrate having jurisdiction, or in default of 

bail forward him in custody to such Magistrate. 

21. Inquiry how to be made by Central Excise Officers against arrested persons forwarded to 

them under Section 19.— (1) When any person is forwarded under Section 19 to a Central Excise Officer 

empowered to send persons so arrested to a Magistrate, the Central Excise Officer shall proceed to inquire 

into the charge against him. 

(2) For this purpose the Central Excise Officer may exercise the same powers and shall be subject to 

the same provisions as the officer-in-charge of a police station may exercise and is subject to under the 

Code of Criminal Procedure, 1898 (5 of 1898) 2, when investigating a cognizable case: 

Provided that— 

(a) if the Central Excise Officer is of opinion that there is sufficient evidence or reasonable ground 
of suspicion against the accused person, he 3[shall, where the offence is non-cognizable, either admit 
him] to bail to appear before a Magistrate having jurisdiction in the case, or forward him in custody to 
such Magistrate; 

(b) if it appears to the Central Excise Officer that there is not sufficient evidence or reasonable 
ground of suspicion against the accused person 4[in respect of offence which is non-cognizable], he 
shall release the accused person on his executing a bond, with or without sureties as the Central Excise 
Officer may direct, to appear, if and when so required, before the Magistrate having jurisdiction, and 
shall make a full report of all the particulars of the case to his official superior. 

22. Vexatious search, seizure, etc., by Central Excise Officer.— Any Central Excise or other officer 

exercising powers under this Act or under the rules made thereunder who— 

(a) without reasonable ground of suspicion searches or causes to be searched any house, boat or 

place; 

(b) vexatiously and unnecessarily detains, searches or arrests any person; 

1. Subs. by Act 17 of 2013, s. 93, for “shall either admit him”. 
2. See now the CrPC, 1973 (2 of 1974). 
3. Subs. by Act 17 of 2013, s. 94(i), for “shall either admit him”. 
4.  Ins. by ibid, s. 94(ii). 

47 

 
                                                           
(c) vexatiously and unnecessarily seizes the movable property of any person, on pretence of seizing 

or searching for any article liable to confiscation under this Act; 

(d) commits, as such officer, any other act to the injury of any person, without having reason to 

believe that such act is required for the execution of his duty; 

shall, for every such offence, be punishable with fine which may extend to two thousand rupees. 

Any person wilfully and maliciously giving false information and so causing an arrest or a search to be 

made  under  this  Act  shall  be  punishable  with  fine  which  may  extend  to  two  thousand  rupees  or  with 

imprisonment for a term which may extend to two years or with both. 

23. Failure of Central Excise Officer in duty.— Any Central Excise Officer who ceases or refuses to 

perform  or  withdraws  himself  from  the  duties  of  his  office,  unless  he  has  obtained  the  express  written 

permission of the 1[Principal Commissioner of Central Excise or Commissioner of Central Excise], or has 

given to his superior officer two months’ notice in writing of his intention or has other lawful excuse, shall 

on conviction before a Magistrate be punishable with imprisonment for a term which may extend to three 

months, or with fine which may extend to three months’ pay, or with both. 

2[CHAPTER IIIA 

ADVANCE RULINGS 

23A. Definitions.—In this Chapter, unless the context otherwise requires,— 

3[(a)  “activity”  means  production  or  manufacture  of  goods  and  includes  any  new  business  of 
production or manufacture proposed to be undertaken by the existing producer or manufacturer, as the 
case may be;] 

(b) “advance ruling” means the determination, by the authority of a question of law or fact specified 
in the application regarding the liability to pay duty in relation to an activity proposed to be undertaken, 
by the applicant; 

4[(c) “applicant” means— 

(i) (a) a non-resident setting up a joint venture in India in collaboration with a non-resident or a 

resident; or 

(b) a resident setting up a joint venture in India in collaboration with a non-resident; or 

(c)  a  wholly  owned  subsidiary  Indian  company,  of  which  the  holding  company  is  a  foreign 

company, 

1. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
2. New Chapter III-A consisting of Ss. 23-A to 23-H ins. by Act 27 of 1999, S. 124. 
3. Subs. by Act 17 of 2013, S. 95 for clause ‘(a) “activity” means production or manufacture of goods;’. 
4. Subs. by Act 18 of 2005, s. 76, for clause (c). 

48 

 
                                                           
who or which, as the case may be, proposes to undertake any business activity in India; 

(ii) a joint venture in India; or 

(iii) a resident falling within any such class or category of persons, as the Central Government may, 

by notification in the Official Gazette, specify in this behalf, 

and which or who, as the case may be, makes application for advance ruling under sub-section (1) 

of Section 23-C;] 

1[Explanation.—For  the  purposes  of  this  clause,  “joint  venture  in  India”  means  a  contractual 
arrangement whereby two or more persons undertake an economic activity which is subject to joint 
control  and  one  or  more  of  the  participants  or  partners  or  equity  holders  is  a  non-resident  having 
substantial interest in such arrangement;] 

(d)  “application”  means  an  application  made  to  the  Authority  under  sub-section  (1)  of                          

Section 23-C; 

2[(e)  “Authority”  means  the  Authority  for  Advance  Rulings  as  defined  in  clause  (e)  of                          

Section 28-E of the Customs Act, 1962 (52 of 1962);] 

3[(f) “non-resident”, “Indian company” and “foreign company” shall have the meaning assigned to 

them in clauses (30), (26) and (23-A) of Section 2 of the Income Tax Act, 1961 (43 of 1961).] 

23B. [Vacancies, etc., not to invalidate proceedings].— Omitted by Finance Act 2017 (7 of 2017), s. 

113. 

23C.  Application  for  advance  ruling.—(1)  An  applicant  desirous  of  obtaining  an  advance  ruling 

under this Chapter may make an application in such form and in such manner as may be prescribed, stating 

the question on which the advance ruling is sought. 

(2) The question on which the advance ruling is sought shall be in respect of,— 

(a) classification of any goods under the Central Excise Tariff Act, 1985; 

(b) applicability of a notification issued under sub-section (1) of Section 5A having a bearing on 

the rate of duty; 

(c) the principles to be adopted for the purposes of determination of value of the goods under the 

provisions of this Act; 

1. Ins. by Act 22 of 2007, s. 118. 
2. Subs. by Act 7 of 2017, s. 112 for clause (e). 
3. Subs. by Act 32 of 2003, s. 142, for clause (f). 

49 

 
                                                           
1[(d) notifications issued, in respect of duties of excise under this Act, the Central Excise Tariff 
Act, 1985 (5 of 1986) and any duty chargeable under any other law for the time being in force in the 
same manner as duty of excise leviable under this Act; 

(e) 2[admissibility of credit of service tax paid or deemed to have been paid on input service or 
excise duty] paid or deemed to have been paid on the goods used in or in relation to the manufacture of 
the excisable goods;] 

3[(f) determination of the liability to pay duties of excise on any goods under this Act.] 

(3)  The  application  shall  be  made  in  quadruplicate  and  be  accompanied  by  a  fee  of 4[ten  thousand 

rupees]. 

(4) An applicant may withdraw an application within thirty days from the date of the application. 

23D. Procedure on receipt of application.—(1) On receipt of an application, the Authority shall cause 

a  copy  thereof  to  be  forwarded  to  the 5[Principal  Commissioner  of  Central  Excise  or  Commissioner  of 

Central Excise] and, if necessary, call upon him to furnish the relevant records: 

Provided that where any records have been called for by the Authority in any case, such records 
shall,  as  soon  as  possible,  be  returned  to  the 5[Principal  Commissioner  of  Central  Excise  or 
Commissioner of Central Excise]. 

(2) The Authority may, after examining the application and the records called for, by order, either allow 

or reject the application: 

Provided that the Authority shall not allow the application 6[* * *] where the question raised in the 

application is,— 

(a)  already  pending  in  the  applicant’s  case  before  any  Central  Excise  Officer,  the  Appellate 

Tribunal or any Court; 

(b) the same as in a matter already decided by the Appellate Tribunal or any Court: 

Provided  further  that  no  application  shall  be  rejected  under  this  sub-section  unless  an 

opportunity has been given to the applicant of being heard: 

Provided also that where the application is rejected, reasons for such rejection shall be given in 

the order. 

1. Ins. by Act 32 of 2003, s. 143. 
2. Subs. by Act 17 of 2013, s. 96, for “admissibility of credit of excise duty”. 
3. Ins. by Act 21 of 2006, s. 65. 
4. Subs. by Act 7 of 2017, s. 114, for “two thousand five hundred rupees”. 
5. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
6. The words “except in the case of a resident applicant” omitted by Act 20 of 2002, s. 138. 

50 

 
                                                           
(3) A copy of every order made under sub-section (2) shall be sent to the applicant and to the 1 [Principal 

Commissioner of Central Excise or Commissioner of Central Excise]. 

(4) Where an application is allowed under sub-section (2), the Authority shall, after examining such 

further material as may be placed before it by the applicant or obtained by the Authority, pronounce its 

advance ruling on the question specified in the application. 

(5) On a request received from the applicant, the Authority shall, before pronouncing its advance ruling, 

provide  an  opportunity  to  the  applicant  of  being  heard,  either  in  person  or  through  a  duly  authorised 

representative. 

Explanation.—For  the  purposes  of  this  sub-section,  “authorised  representative”  shall  have  the 

meaning assigned to it in sub-section (2) of Section 35-Q. 

(6) The Authority shall pronounce its advance ruling in writing within 2[six months] of the receipt of 

application. 

(7)  A  copy  of  the  advance  ruling  pronounced  by  the  Authority,  duly  signed  by  the  Members  and 

certified in the  prescribed manner  shall  be  sent  to  the  applicant and to  the 1[Principal  Commissioner  of 

Central Excise or Commissioner of Central Excise], as soon as may be, after such pronouncement. 

23E. Applicability of advance ruling.—(1) The advance ruling pronounced by the Authority under 

Section 23D shall be binding only— 

(a) on the applicant who had sought it; 

(b) in respect of any matter referred to in sub-section (2) of Section 23C; 

(c) on the 1[Principal Commissioner of Central Excise or Commissioner of Central Excise], and the 

Central Excise Authorities subordinate to him, in request of the applicant. 

(2) The  advance  ruling  referred  to  in  sub-section (1) shall  be  binding  as aforesaid  unless  there  is a 

change in law or facts on the basis of which the advance ruling has been pronounced. 

23F.  Advance  ruling  to  be  void  in  certain  circumstances.—(1)  Where  the  Authority  finds,  on  a 

representation made to it by the 1[Principal Commissioner of Central Excise or Commissioner of Central 
Excise] or otherwise, that an advance ruling pronounced by it under sub-section (6) of 3[Section 23D] has 

been obtained by the applicant by fraud or misrepresentation of facts, it may, by order, declare such ruling 

to  be  void  ab initio and thereupon all the  provisions of this  Act shall  apply  (after excluding  the  period 

1. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
2. Subs. by Act 7 of 2017, s. 115, for “ninety days”. 
3. Subs. by Act 17 of 2013, s. 97, for “Section 28I”. 

51 

 
                                                           
beginning with the date of such advance ruling and ending with the date of order under this sub-section) to 

the applicant as if such advance ruling had never been made. 

(2) A copy of the order made under sub-section (1) shall be sent to the applicant and the 3[Principal 

Commissioner of Central Excise or Commissioner of Central Excise]. 

23G.  Powers  of  Authority.—(1)  The  Authority  shall,  for  the  purpose  of  exercising  its  powers 

regarding discovery and inspection, enforcing the attendance of any person and examining him on oath, 

issuing commissions and compelling production of books of account and other records, have all the powers 

of a civil court under the Code of Civil Procedure, 1908. 

(2) The Authority shall be deemed to be a civil court for the purposes of Section 195, but not for the 

purposes  of  Chapter  XXVI  of  the  Code  of  Criminal  Procedure,  1973  and  every  proceeding  before  the 

Authority shall be deemed to be a judicial proceeding within the meaning of Sections 193 and 228, and for 

the purpose of Section 196 of the Indian Penal Code. 

23H. Procedure of Authority.—The Authority shall, subject to the provisions of this Chapter, have 

power to regulate its own procedure in all matters arising out of the exercise of its powers under this Act. 

1[23I. Transitional provision.—On and from the date on which the Finance Bill, 2017 receives the 

assent  of  the  President,  every  application  and  proceeding  pending  before  the  erstwhile  Authority  for 

Advance Rulings (Central Excise, Customs and Service Tax) shall stand transferred to the Authority from 

the stage at which such application or proceeding stood as on the date of such assent.]] 

2[CHAPTER IV 

TRANSPORT BY SEA 

24.  [Penalties for  carrying  excisable  goods  in  certain  vessels].—Omitted  by Finance  Act  2002  (20  of 

2002), s. 139 (w.e.f. 11-5-2002). 

25. [Exceptions].— Omitted by s. 139, ibid. (w.e.f. 11-5-2002). 

26. [Power of stoppage, search and arrest.]— Omitted by s. 139, ibid. (w.e.f. 11-5-2002). 

27. [Penalties for resisting officer.]— Omitted by s. 139, ibid. (w.e.f. 11-5-2002). 

28. [Confiscation of vessel and cargo.]— Omitted by s. 139, ibid. (w.e.f. 11-5-2002). 

29. [Jurisdiction.]— Omitted by s. 139, ibid. (w.e.f. 11-5-2002). 

30. Power to exempt from operation of this Chapter.—  Omitted by s. 139, ibid. (w.e.f. 11-5-2002).] 

1. Ins. by Act 7 of 2017, s. 116. 
2. Omitted by Act 20 of 2002, s. 139 (w.e.f. 11-5-2002) 

52 

 
                                                           
1[CHAPTER V 

SETTLEMENT OF CASES 

2[31. Definitions.—In this Chapter, unless the context otherwise requires.— 

(a) “assessee” means any person who is liable for payment of excise duty assessed under this Act 
or any other Act and includes any producer or manufacturer of excisable goods or a registered person 
under the rules made under this Act, of a private warehouse in which excisable goods are stored; 

(b) “Bench” means a Bench of the Settlement Commission; 

3[(c) “case” means any proceeding under this Act or any other Act for the levy, assessment and 
collection of excise duty, pending before an adjudicating authority on the date on which an application 
under sub-section (1) of Section 32-E is made: 

Provided that when any proceeding is referred back 4[* * *] by any court, Appellate Tribunal or 
any other authority, to the adjudicating authority for a fresh adjudication or decision, as the case may 
be, then such proceeding shall not be deemed to be a proceeding pending within the meaning of this 
clause;] 

(d) “Chairman” means the Chairman of the Settlement Commission; 

(e) “Commissioner (Investigation)” means an officer of the Customs or a Central Excise Officer 
appointed as such Commissioner to conduct inquiry or investigation for the purposes of this Chapter; 

(f) “Member” means a Member of the Settlement Commission and includes the Chairman and the 

Vice-Chairman; 

(g) “Settlement  Commission”  means  the 5[Customs,  Central  Excise and  Service Tax  Settlement 

Commission] constituted under Section 32; and 

(h) “Vice-Chairman” means a Vice-Chairman of the Settlement Commission.] 

6[32. Customs and Central Excise Settlement Commission.—(1) The Central Government shall, by 
notification in the Official Gazette, constitute a Commission to be called 7[the Customs, Central Excise and 

Service Tax Settlement Commission] for the settlement of cases under this Chapter and Chapter XIV-A of 

the Customs Act, 1962. 

1. Chapter V consisting of Ss. 31 to 32P, ins. by Act 21 of 1998, s. 110, 
2. Ins. by ibid. s. 110. 
3. Subs. by Act 22 of 2007, s. 119, for clause (c), (w.e.f. 1-6-2007). 
4. The words “in any appeal or revision, as the case may be,” omitted by Act 20 of 2015, s. 95. 
5. Subs. by Act 25 of 2014, s. 98, for “Customs and Central Excise Settlement Commission”. 
6. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 
7. Subs. by Act 25 of 2014, s. 99, for “the Customs and Central Excise Settlement Commission”. 

53 

 
                                                           
(2) The Settlement Commission shall consist of a Chairman and as many Vice-Chairmen and other 

Members as the Central Government thinks fit and shall function within the Department of the Central 

Government dealing with Customs and Central Excise matters. 

(3)  The  Chairman,  Vice-Chairman  and  other  Members  of  the  Settlement  Commission  shall  be 

appointed by the Central Government from amongst persons of integrity and outstanding ability, having 

special knowledge of, and experience in, administration of customs and central excise laws:] 

1[* * *] 

2[32A. Jurisdiction and powers of Settlement Commission.—(1) Subject to the other provisions of 

this Chapter, the jurisdiction, powers and authority of the Settlement Commission may be exercised by 

Benches thereof. 

(2) Subject to the other provisions of this section, a Bench shall be presided over by the Chairman or a 

Vice-Chairman and shall consist of two other Members. 

(3) The Bench for which the Chairman is the presiding officer shall be the principal Bench and other 

Benches shall be known as additional Benches. 

(4)  Notwithstanding  anything  contained  in  sub-section  (1)  and  sub-section  (2),  the  Chairman  may 

authorise the Vice-Chairman or other Member appointed to one Bench to discharge also the functions of 

the Vice-Chairman or, as the case may be, other Member of another Bench. 

(5)  The  principal  Bench  shall  sit  at  Delhi  and  the  Central  Government  shall,  by  notification  in  the 

Official Gazette, establish additional Benches at such places as it considers necessary. 

(6) Notwithstanding anything contained in the foregoing provisions of this section, and subject to any 

rules that may be made in this behalf, when one of the persons constituting a Bench (whether such person 

be  the  presiding  officer  or  other  Member  of  the  Bench)  is  unable  to  discharge  his  functions  owing  to 

absence, illness or any other cause or in the event of the occurrence of any vacancy either in the office of 

the presiding officer or in the office of one or the other Members of the Bench, the remaining Members 

may function as the Bench and if the presiding officer of the Bench is not one of the remaining Members, 

the senior among the remaining Members shall act as the presiding officer of the Bench: 

Provided that if at any stage of the hearing of any such case or matter, it appears to the presiding 
officer that the case or matter is of such a nature that it ought to be heard of by a Bench consisting of 
three  Members,  the  case  or  matter  may  be  referred  by  the  presiding  officer  of  such  Bench  to  the 
Chairman for transfer to such Bench as the Chairman may deem fit: 

1. Proviso omitted by Act 20 of 2015, s. 96. 
2. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 

54 

 
                                                           
1[Provided further that at any stage of the hearing of any such case or matter, referred to in the first 

proviso, the Chairman may, if he thinks that the case or matter is of such a nature that it ought to be heard 

by a Bench consisting of three Members, constitute such Bench and if Vice-Chairman is not one of the 

Members, the senior among the Members shall act as the presiding officer of such Bench.] 

(7) Notwithstanding anything contained in the foregoing provisions of this section, the Chairman may, 

for the disposal of any particular case, constitute a special Bench consisting of more than three Members. 

(8) Subject to the other provisions of this Chapter, the special Bench shall sit at a place to be fixed by 

the Chairman.] 

2[32B.  Vice-Chairman  to  act  as  Chairman  or  to  discharge  his  functions  in  certain 

circumstances.—(1) In the event of the occurrence of any vacancy in the office of the Chairman by reason 
of  his  death,  resignation  or  otherwise, the Vice-Chairman  or 3[the  Member]  as  the  Central  Government 

may, by notification in the Official Gazette, authorise in this behalf, shall act as the Chairman until the date 

on which a new Chairman, appointed in accordance with the provisions of this Chapter to fill such vacancy, 

enters upon his office. 

(2) When the Chairman is unable to discharge his functions owing to absence, illness or any other cause, 
the  Vice-Chairman  or 3[the  Member]  as  the  Central  Government  may,  by  notification  in  the  Official 

Gazette, authorise in this behalf, shall discharge the functions of the Chairman until the date on which the 

Chairman resumes his duties.] 

 2[32C. Power of Chairman to transfer cases from one Bench to another.—On the application of 

the assessee or the Chief Commissioner or 4[Principal Commissioner of Central Excise or Commissioner 

of Central Excise] and after giving notice to them, and after hearing such of them as he may desire to be 

heard, or on his own motion without such notice, the Chairman may transfer any case pending before one 

Bench, for disposal, to another Bench.] 

2[32D. Decision to be by majority.—If the Members of a Bench differ in opinion on any point, the 

point shall be decided according to the opinion of the majority, if there is a majority, but if the Members 

are equally divided, they shall state the point or points on which they differ, and make a reference to the 

Chairman who shall either hear the point or points himself or refer the case for hearing on such point or 

points by one or more of the other Members of the Settlement Commission and such point or points shall 

be decided according to the opinion of the majority of the Members of the Settlement Commission who 

have heard the case, including those who first heard it.] 

1. Ins. by Act 22 of 2007, s. 120. 
2. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 
3. Subs. by Act 20 of 2015, s. 97, for “, as the case may be, such one of the Vice-Chairmen”. 
4. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 

55 

 
                                                           
1[32E. Application for settlement of cases.—2[(1) An assessee may, in respect of a case relating to 

him, make an application, before adjudication, to the Settlement Commission to have the case settled, in 

such form and in such manner as may be prescribed and containing a full and true disclosure of his duty 

liability which has not been disclosed before the Central Excise Officer having jurisdiction, the manner in 

which such liability has been derived, the additional amount of excise duty accepted to be payable by him 

and such other particulars as may be prescribed including the particulars of such excisable goods in respect 

of which he admits short levy on account of misclassification, under-valuation, inapplicability of exemption 
notification or CENVAT credit 3[or otherwise] and any such application shall be disposed of in the manner 

hereinafter provided: 

Provided that no such application shall be made unless,— 

(a) the applicant has filed returns showing production, clearance and central excise duty paid in the 

prescribed manner; 

(b) a show cause notice for recovery of duty issued by the Central Excise Officer has been received 

by the applicant; 

(c) the additional amount of duty accepted by the applicant in his application exceeds three lakh 

rupees; and 

(d) the applicant has paid the additional amount of excise duty accepted by him along with interest 

due under 4[Section 11AA]: 

5[Provided further that the Settlement Commission, if it is satisfied that the circumstances exist for not 

filing the returns referred to in clause (a) of the first proviso to sub-section (1), may after recording the 

reasons therefor, allow the applicant to make such application: 

Provided  also  that]  no  application  shall  be  entertained  by  the  Settlement  Commission  under  this                    

sub-section in cases which are pending with the Appellate Tribunal or any court: 

Provided  also  that  no  application  under  this  sub-section  shall  be  made  for  the  interpretation  of  the 

classification of excisable goods under the Central Excise Tariff Act, 1985 (5 of 1986). 

(1A) 6[* * *]] 

(2) 7[* * *] 

1. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 
2. Subs. by Act 22 of 2007, s. 121, for sub-section (1) (w.e.f. 1-6-2007). 
3. Subs. by Act 14 of 2010, s. 65, for “but excluding the goods in respect of which no proper record has been maintained by the 

assessee in his daily stock register”. 

4. Subs. by Act 25 of 2014, s. 100(i)(a), for “Section 11AB”. 
5. Subs. by ibid., s. 100(i)(b), for “Provided further that”. 
6. Sub-section (1A) omitted by Act 20 of 2015, s. 98.  
7. Omitted by Act 25 of 2014, s. 100(ii). 

56 

 
                                                           
(3)  Every  application  made  under  sub-section  (1)  shall  be  accompanied  by  such  fees  as  may  be 

prescribed. 

(4) An application made under sub-section (1) shall not be allowed to be withdrawn by the applicant. 

1[(5) Any person other than an assessee, may also make an application to the Settlement Commission 

in respect of a show-cause notice issued to him in a case relating to the assessee which has been settled or 

is pending before the Settlement Commission and such notice is pending before an adjudicating authority, 

in such manner and subject to such conditions, as may be prescribed.]] 

2[  3[32F.  Procedure  on  receipt  of  an  application  under  Section  32E.—(1)  On  receipt  of  an 

application under 4[* * *] Section 32E, the Settlement Commission shall, within seven days from the date 

of receipt of the application, issue a notice to the applicant to explain in writing as to why the application 

made by him should be allowed to be proceeded with, and after taking into consideration the explanation 

provided by the applicant, the Settlement Commission, shall, within a period of fourteen days from the date 

of the notice, by an order, allow the application to be proceeded with, or reject the application as the case 

may be, and the proceedings before the Settlement Commission shall abate on the date of rejection: 

Provided that where no notice has been issued or no order has been passed within the aforesaid period 

by the Settlement Commission, the application shall be deemed to have been allowed to be proceeded with. 

(2) A copy of every order under sub-section (1), shall be sent to the applicant and to the 5[Principal 

Commissioner of Central Excise or Commissioner of Central Excise] having jurisdiction. 

(3)  Where  an  application  is  allowed  or  deemed  to  have  been  allowed  to  be  proceeded  with  under                    

sub-section  (1),  the  Settlement  Commission  shall,  within  seven  days  from  the  date  of  order  under                           

sub-section  (1),  call  for  a  report  along  with  the  relevant  records  from  the  5[Principal  Commissioner  of 

Central Excise or Commissioner of Central Excise] having jurisdiction and the Commissioner shall furnish 

the report within a period of thirty days of the receipt of communication from the Settlement Commission: 

Provided that where the Commissioner does not furnish the report within the aforesaid period of 
thirty days, the Settlement Commission shall proceed further in the matter without the report of the 
Commissioner. 

(4) Where a report of the Commissioner called for under sub-section (3) has been furnished within the 

period specified in that sub-section, the Settlement Commission may, after examination of such report, if it 

is of the opinion that any further enquiry or investigation in the matter is necessary, direct, for reasons to 

1. Ins. by Act 7 of 2017, s. 117. 
2. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 
3. Subs. by Act 22 of 2007, s. 122, for “section 32F” (w.e.f. 1-6-2007). 
4. The word “sub-section (1) of” omitted by Act 7 of 2017, s. 118(i). 
5. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 

57 

 
                                                           
be recorded in writing, the Commissioner (Investigation) within fifteen days of the receipt of the report, to 

make or cause to be made such further enquiry or investigation and furnish a report within a period of ninety 

days of the receipt of the communication from the Settlement Commission, on the matters covered by the 

application and any other matter relating to the case:] 

Provided  that  where  the  Commissioner  (Investigation)  does  not  furnish  the  report  within  the 
aforesaid  period,  the  Settlement  Commission  shall  proceed  to  pass  an  order  under  sub-section  (5) 
without such report. 

(5) After examination of the records and the report of the 1[Principal Commissioner of Central Excise 

or  Commissioner  of  Central  Excise]  received  under  sub-section  (3),  and  the  report,  if  any,  of  the 

Commissioner  (Investigation)  of  the  Settlement  Commission  under  sub-section  (4),  and  after  giving  an 
opportunity to the applicant and to the 1[Principal  Commissioner of Central Excise or Commissioner of 

Central Excise] having jurisdiction to be heard, either in person or through a representative duly authorised 

in this behalf, and after examining such further evidence as may be placed before it or obtained by it, the 

Settlement Commission may, in accordance with the provisions of this Act, pass such order as it thinks fit 

on  the  matters  covered  by  the  application  and  any  other  matter  relating  to  the  case  not  covered  by  the 

application, but referred to in the report of the 1[Principal Commissioner of Central Excise or Commissioner 

of Central Excise] and Commissioner (Investigation) under sub-section (3) or sub-section (4). 

2[(5A) The Settlement Commission may, at any time within three months from the date of passing of 

the order under sub-section (5), amend such order to rectify any error apparent on the face of record, either 

suo motu or when such error is brought to its notice by the jurisdictional Principal Commissioner of Central 

Excise or Commissioner of Central Excise or the applicant: 

Provided that no amendment which has the effect of enhancing the liability of the applicant shall 
be made under this sub-section, unless the Settlement Commission has given notice of such intention 
to the applicant and the jurisdictional Principal Commissioner of Central Excise or Commissioner of 
Central Excise as the case may be, and has given them a reasonable opportunity of being heard.] 

(6) An order under sub-section (5) shall not be passed in respect of an application filed 3[* * *] after 

nine months from the last day of the month in which the application was made, failing which the settlement 

proceedings shall abate, and the adjudicating authority before whom the proceeding at the time of making 

the application was pending, shall dispose of the case in accordance with the provisions of this Act as if no 

application under Section 32-E had been made: 

1. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
2. Ins. by Act 7 of 2017, s. 118(ii). 
3. The words “on or before the 31st day of May, 2007, later than the 29th day of February, 2008 and in respect of an application 

made on or after the 1st day of June, 2007,” omitted by Act 20 of 2015, s. 99. 

58 

 
                                                           
1[Provided that the period specified under this sub-section may, for reasons to be recorded in writing, 

be extended by the Settlement Commission for a further period not exceeding three months.] 

(7) Subject to the provisions of Section 32A, the materials brought on record before the Settlement 

Commission shall be considered by the Members of the concerned Bench before passing any order under 

sub-section (5) and, in relation to the passing of such order, the provisions of Section 32D shall apply. 

(8)  The  order  passed  under  sub-section  (5)  shall  provide  for  the  terms  of  settlement  including  any 

demand by way of duty, penalty or interest, the manner in which any sums due under the settlement shall 

be paid and all other matters to make the settlement effective and in case of rejection contain the reasons 

therefor  and  it  shall  also  provide  that  the  settlement  shall  be  void  if  it  is  subsequently  found  by  the 

Settlement Commission that it has been obtained by fraud or misrepresentation of facts: 

Provided that the amount of settlement ordered by the Settlement Commission shall not be less 

than the duty liability admitted by the applicant under Section 32E. 

(9) Where any duty, interest, fine and penalty payable in pursuance of an order under sub-section (5), 

is not paid by the assessee within thirty days of receipt of a copy of the order by him, the amount which 

remains  unpaid,  shall  be  recovered  along  with  interest  due  thereon,  as  the  sums  due  to  the  Central 

Government by the Central Excise Officer having jurisdiction over the assessee in accordance with the 

provisions of Section 11. 

(10) Where a settlement becomes void as provided under sub-section (8), the proceedings with respect 

to the matters covered by the settlement shall be deemed to have been revived from the stage at which the 

application was allowed to be proceeded with by the Settlement Commission and the Central Excise Officer 

having jurisdiction may, notwithstanding anything contained in any other provision of this Act, complete 

such proceedings at any time before the expiry of two years from the date of the receipt of communication 

that the settlement became void.] 

2[32G. Power of Settlement Commission to order provisional attachment to protect revenue.—

Where, during the pendency of any proceeding before it, the Settlement Commission is of the opinion that 

for  the  purpose  of  protecting  the  interests  of  revenue  it  is  necessary  so  to  do,  it  may,  by  order,  attach 

provisionally any property belonging to the applicant in the manner as may be prescribed. 

(2) Every provisional attachment made by the Settlement Commission under sub-section (1) shall cease 

to have effect from the date, the sums due to the Central Government for which such attachment is made 

are discharged by the applicant and evidence to that effect is submitted to the Settlement Commission.] 

1. Ins. by Act 14 of 2010, s. 66. 
2. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 

59 

 
                                                           
1[32H. [Power of Settlement Commission to reopen completed proceedings.—Omitted by Finance 

Act 2015 (Act 20 of 2015), s. 100. ] 

1[32I. Powers and procedure of Settlement Commission.—(1) In addition to the powers conferred 

on the Settlement Commission under this Chapter, it shall have all the powers which are vested in a Central 

Excise Officer under this Act or the rules made thereunder. 

(2) Where an application made under Section 32E has been allowed to be proceeded with under Section 

32F, the Settlement Commission shall, until an order is passed under sub-section   2[(5)] of Section 32F, 
have, subject to the provisions of sub-section 3[(4)] of that section, exclusive jurisdiction to exercise the 

powers and perform the functions of any Central Excise Officer, under this Act in relation to the case. 

(3) In the absence of any express direction by the Settlement Commission to the contrary, nothing in 

this Chapter shall affect the operation of the provisions of this Act in so far as they relate to any matters 

other upon those before the Settlement Commission. 

(4) The Settlement Commission shall, subject to the provisions of this Chapter, have power to regulate 

its own procedure and the procedure of Benches thereof in all matters arising out of the exercise of its 

powers,  or  of  the  discharge  of  its  functions, including  the  places  at  which  the  Benches shall  hold  their 

sittings.] 

1[32J. Inspection, etc., of reports.—No person shall be entitled to inspect, or obtain copies of, any 

report made by any Central Excise Officer to the Settlement Commission; but the Settlement Commission 

may, in its discretion furnish copies thereof to any such person on an application made to it in this behalf 

and on payment of the prescribed fee: 

Provided that, for the purpose of enabling any person whose case is under consideration to rebut any 

evidence  brought  on  record  against  him  in  any  such  report,  the  Settlement  Commission  shall,  on  an 

application made in this behalf, and on payment of the prescribed fee by such person, furnish him with a 

certified copy of any such report or part thereof relevant for the purpose.] 

1 [32K. Power of Settlement Commission to grant immunity from prosecution and penalty.—The 

Settlement Commission may, if it is satisfied that any person who made the application for settlement under 

Section 32E has cooperated with the Settlement Commission in the proceedings before it and has made a 

full and true disclosure of his duty liability, grant to such person, subject to such conditions as it may think 
fit to impose, immunity from prosecution for any offence under this Act 4[and also either wholly or in part 

1. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 
2. Subs. by Act 22 of 2007, s. 124 (w.e.f. 1-6-2007), for “(7)”. 
3. Subs. by ibid, s. 124 (w.e.f. 1-6-2007), for “(6)”. 
4. Subs. by ibid, s. 125, for “or under the Indian Penal Code (45 of 1860) or under any other Central Act for the time being in 

force and also either wholly or in part from the imposition of any penalty, fine and interest” (w.e.f. 1-6-2007). 

60 

 
                                                           
from  the  imposition  of  any  penalty  and  fine]  under  this  Act,  with  respect  to  the  case  covered  by  the 

settlement: 

Provided that no such immunity shall be granted by the Settlement Commission in cases where the 

proceedings for the prosecution for any such offence have been instituted before the date of receipt of the 

application under Section 32E. 

1[* * *] 

(2) An immunity granted to a person under sub-section (1) shall stand withdrawn if such person fails 

to pay any sum specified in the order of the settlement passed under 2[sub-section (5) of Section 32-F within 

the time specified in such order], or fails to comply with any other condition subject to which the immunity 

was granted and thereupon the provisions of this Act shall apply as if such immunity had not been granted. 

(3)  An  immunity  granted to  a  person  under  sub-section  (1)  may,  at  any  time,  be  withdrawn  by  the 

Settlement Commission, if it is satisfied that such person had, in the course of the settlement proceedings, 

concealed any particular material to the settlement or had given false evidence, and thereupon such person 

may be tried for the offence with respect to which the immunity was granted or for any other offence of 

which he appears to have been guilty in connection with the settlement and shall also become liable to the 

imposition  of  any  penalty  under  this  Act  to  which  such  person  would  have  been  liable,  had  no  such 

immunity been granted.] 

3[32L. Power of Settlement Commission to send a case back to the Central Excise Officer.—(1) 

The Settlement Commission may, if it is of opinion that any person who made an application for settlement 

under Section 32E has not cooperated with the Settlement Commission in the proceedings before it, send 

the case back to the Central Excise Officer having jurisdiction who shall thereupon dispose of the case in 

accordance with the provisions of this Act as if no application under Section 32E had been made. 

(2) For the purpose of sub-section (1), the Central Excise Officer shall be entitled to use all the materials 

and other information produced by the assessee before the Settlement Commission or the results of the 

inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it 

as  if  such  materials,  information,  inquiry  and  evidence  had  been  produced  before  such  Central  Excise 

Officer or held or recorded by him in the course of the proceedings before him. 

(3)  For  the  purposes  of  the  time-limit  under  Section  11A  and  for  the  purposes  of  interest  under               

Section 11BB, in a case referred to in sub-section (1), the period commencing on and from the date of the 

application to the Settlement Commission under Section 32E and ending with the date of receipt by the 

1. Explanation omitted by Act 20 of 2015, S. 101. 
2. Subs. by Act 22 of 2007, s. 125, for “sub-section (7) of section 32F within the time specified in such order or within such 

further time as may be allowed by the Settlement Commission” (w.e.f. 1-6-2007), 

3. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 

61 

 
                                                           
Central Excise Officer of the order of the Settlement Commission sending the case back to the Central 

Excise Officer shall be excluded.] 

1[32M.  Order  of  settlement  to  be  conclusive.—Every  order  of  settlement  passed  under                           

sub-section 2[(5)] of Section 32-F shall be conclusive as to the matters stated therein and no matter covered 

by such order shall, save as otherwise provided in this Chapter, be reopened in any proceeding under this 

Act or under any other law for the time being in force.] 

1[32N.  Recovery  of  sums  due  under  order  of  settlement.—Any  sum  specified  in  an  order  of 
settlement passed under sub-section 2[(5)] of Section 32-F may, subject to such conditions if any, as may 

be specified therein, be recovered, and any penalty for default in making payment of such sum may be 

imposed and recovered as sums due to the Central Government in accordance with the provisions under 

Section 11 by the Central Excise Officer having jurisdiction over the person who made the application for 

settlement under Section 32E.] 

1[32O. Bar on subsequent application for settlement in certain cases.— 3[(1)] 4[Where, 5[* * *]]— 

(i) an order of settlement 6[* * *] provides for the imposition of a penalty on the person who made 
the application under Section 32E for settlement, on the ground of concealment of particulars of his 
duty liability; or 

7[Explanation.—In this clause, the concealment of particulars of duty liability relates to any such 

concealment made from the Central Excise Officer.] 

(ii) after the passing of an order of settlement 8[* * *] in relation to a case, such person is convicted 

of any offence under this Act in relation to that case; or 

(iii) the case of such person is sent back to the Central Excise Officer having jurisdiction by the 

Settlement Commission under Section 32-L, 

then, he shall not be entitled to apply for settlement under Section 32-E in relation to any other 

matter. 

(2) 9[* * *]] 

1. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 
2. Subs. by Act 22 of 2007, s. 126, for “(7)” (w.e.f. 1-6-2007),. 
3. Renumbered by ibid, s. 128. 
4. Subs. by ibid, s. 128, for “Where”. 
5. The words “before the 1st day of June, 2007” Omitted by Act 14 of 2010, S. 67(a)(i). 
6. The words “passed under sub-section (7) of Section 32-F, as it stood immediately before the commencement of Section 122 of 

the Finance Act, 2007 (22 of 2007) or sub-section (5) of Section 32-F” omitted by Act 20 of 2015, s. 102(a). 

7. Ins. by Act 25 of 2014, s. 101. 
8. The words “under the said sub-section (7), as it stood immediately before the commencement of Section 122 of the Finance 

Act, 2007 (22 of 2007) or sub-section (5) of Section 32-F” omitted by Act 20 of 2015, s. 102(b). 

9. Ins. by Act 22 of 2007, s. 128 and omitted by Act 14 of 2010, s. 67(b). 

62 

 
                                                           
1[32P. Proceedings before Settlement Commission to be judicial proceedings.—Any proceedings 

under this Chapter before the Settlement Commission shall be deemed to be a judicial proceeding within 

the meaning of Sections 193 and 228, and for the purposes of Section 196 of the Indian Penal Code.] 

32PA.  Certain  persons  who  have  filed  appeals  to  the  Appellate  Tribunal  entitled  to  make 

applications to the Settlement Commission.— Omitted by Finance Act 2007 (22 of 2007), s. 129 (w.e.f. 

1-6-2007). 

CHAPTER VI 

ADJUDICATION OF CONFISCATIONS AND PENALTIES 

33. Power of adjudication.— 2[Where under this Act or by the rules made thereunder] anything is 

liable to confiscation or any person is liable to a penalty, such confiscation or penalty may be adjudged— 

(a) without limit, by a 3[Principal  Commissioner of Central Excise or Commissioner of Central 

Excise]; 

(b) up to confiscation of goods not exceeding five hundred rupees in value and imposition of penalty 
not  exceeding  two  hundred  and  fifty  rupees,  by  an  Assistant   3[Principal  Commissioner  of  Central 
Excise or Commissioner of Central Excise] 4[or Deputy 3 [Principal Commissioner of Central Excise 
or Commissioner of Central Excise]]: 

Provided that the 5[Central Board of Excise and Customs constituted under the Central Boards of 
Revenue  Act,  1963  (54  of  1963)],  may,  in  the  case  of  any  officer  performing  the  duties  of  an 
Assistant  3[Principal Commissioner of Central Excise or Commissioner of Central Excise], reduce the 
limits indicated in clause (b) of this section, and may confer on any officer the powers indicated in 
clause (a) or (b) of this section. 

6[33A. Adjudication procedure.—(1) The adjudicating authority shall, in any proceeding under this 

chapter or any other provision of this Act, give an opportunity of being heard to a party in a proceeding, if 

the party so desires. 

(2) The adjudicating authority may, if sufficient cause is shown, at any stage of proceeding referred to 

in sub-section (1), grant time, from time to time, to the parties or any of them and adjourn the hearing for 

reasons to be recorded in writing: 

1. Ins. by Act 21 of 1998, s. 110 (w.e.f. 1-8-1998). 
2. Subs. by Act 27 of 1999, s. 125, for “Where by the rules made under this Act” (w.e.f. 11-5-1999). 
3. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
4. Ins. by Act 27 of 1999, s. 119. 
5. Subs. by Act 54 of 1963, s. 5, for “Central Board of Revenue” (w.e.f. 1-1-1964). 
6. Ins. by Act 23 of 2004, s. 81. 

63 

 
 
                                                           
Provided that no such adjournment shall be granted more than three times to a party during the 

proceeding.] 

34. Option to pay fine in lieu of confiscation.—Wherever confiscation is adjudged under this Act or 

the rules made thereunder, the officer adjudging it, shall give the owner of the goods an option to pay in 

lieu of confiscation such fine as the officer thinks fit. 

1[34A. Confiscation or penalty not to interfere with other punishments.—No confiscation made or 

penalty imposed under the provisions of this Act or of any rule made thereunder shall prevent the infliction 

of any other punishment to which the person affected thereby is liable under the provisions of this Act or 

under any other law.] 

2[CHAPTER VIA 

APPEALS 

35.  Appeals  to  3[Commissioner  (Appeals).—(1)  Any  person  aggrieved  by  any  decision  or  order 
passed under this Act by a Central Excise Officer, lower in rank than a 4[Principal Commissioner of Central 

Excise or Commissioner of Central Excise], may appeal to the  4[Principal Commissioner of Central Excise 
or Commissioner of Central Excise] (Appeals) [hereafter in this Chapter referred to as the 3[Commissioner 

(Appeals)]] 5[within sixty days] from the date of the communication to him of such decision or order: 

6[Provided that the Commissioner (Appeals) may, if he is satisfied that the appellant was prevented 
by sufficient cause from presenting the appeal within the aforesaid period of 5[sixty days], allow it to 
be presented within a further period of thirty days]. 

7[(1A) The Commissioner (Appeals) may, if sufficient cause is shown, at any stage of hearing of an 

appeal, grant time, from time to time, to the parties or any of them and adjourn the hearing of the appeal 

for reasons to be recorded in writing: 

Provided that no such adjournment shall be granted more than three times to a party during hearing 

of the appeal.] 

(2) Every appeal under this section shall be in the prescribed form and shall be verified in the prescribed 

manner. 

1. Ins. by Act 36 of 1973, s. 22, (w.e.f. 1-9-1973). 
2. Subs. by Act 44 of 1980, s. 50 and Schedule V, Pt. II-2, for sections 35, 35A and 36 (w.e.f. 11-10-1982). 
3. Substituted by Act 22 of 1995, s.  70, for “Collector (Appeals)” (w.e.f. 26-5-1995). 
4. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
5. Subs. by Act 14 of 2001, s. 127, for “with three months” (w.e.f. 11-5-2001). 
6. Subs. by ibid., s. 127, for proviso (w.e.f. 11-5-2001).  
7. Ins. by Act 23 of 2004, s. 82 (w.e.f. 10-9-2004). 

64 

 
                                                           
35A.  Procedure  in  appeal.—(1)  The  1[Commissioner  (Appeals)]  shall  give  an  opportunity  to  the 

appellant to be heard, if he so desires. 

(2) The 1[Commissioner (Appeals)] may, at the hearing of an appeal, allow an appellant to go into any 

ground of appeal not specified in the grounds of appeal, if the 1[Commissioner (Appeals)] is satisfied that 

the omission of that ground from the grounds of appeal was not wilful or unreasonable. 

(3) 2[The Commissioner (Appeals) shall, after making such further inquiry as may be necessary, pass 

such order, as he thinks just and proper, confirming, modifying or annulling the decision or order appealed 

against:] 

Provided that an order enhancing any penalty or fine in lieu of confiscation or confiscating goods 
of greater value or reducing the amount of refund shall not be passed unless the appellant has been 
given a reasonable opportunity of showing cause against the proposed order: 

Provided further that where the  1[Commissioner (Appeals)] is of opinion that any duty of excise 
has not been levied or paid or has been short-levied or short-paid or erroneously refunded, no order 
requiring the appellant to pay any duty not levied or paid, short-levied or short-paid or erroneously 
refunded shall be passed unless the appellant is given notice within the time-limit specified in Section 
11A to show cause against the proposed order. 

(4) The order of the  1[Commissioner (Appeals)] disposing of the appeal shall be in writing and shall 

state the points for determination, the decision thereon and the reasons for the decision. 

 3[(4A) The Commissioner (Appeals) shall, where it is possible to do so, hear and decide every appeal 

within a period of six months from the date on which it is filed.] 

(5) On the disposal of the appeal, the 1[Commissioner (Appeals)] shall communicate the order passed 
by him to the appellant, the adjudicating authority 4[, the 5[Principal Chief Commissioner of Central Excise 

or  Chief  Commissioner  of  Central  Excise]]  and  the 6[Principal  Commissioner  of  Central  Excise  or 

Commissioner of Central Excise]. 

35B. Appeals to the Appellate Tribunal.—(1) Any person aggrieved by any of the following orders 

may appeal to the Appellate Tribunal against such order— 

(a) a decision or order passed by the 6[Principal Commissioner of Central Excise or Commissioner 

of Central Excise] as an adjudicating authority; 

1.  Substituted by Act 22 of 1995, Section 70, for “Collector (Appeals)” (w.e.f. 26-5-1995). 
2. Subs. by Act 14 of 2001, s. 128(a), for certain words (w.e.f. 11-5-2001). 
3. Ins. by ibid., s. 128(b) (w.e.f. 11-5-2001). 
3. Ins. by Act 18 of 2005, s. 78. 
4.  Subs. by Act 25 of 2014, s. 95, for “Chief Commissioner of Central Excise”. 
5. Subs. by ibid., s. 95, for “Commissioner of Central Excise”. 

65 

 
                                                           
(b) an order passed by the 1[Commissioner (Appeals)] under Section 35-A; 

(c)  an  order  passed  by  the  Central  Board  of  Excise  and  Customs  constituted  under  the  Central 
Boards of Revenue Act, 1963 (54 of 1963) (hereafter in this Chapter referred to as the Board) or the 
Appellate 2[Principal  Commissioner  of  Central  Excise  or  Commissioner  of  Central  Excise]  under 
Section 35, as it stood immediately before the appointed day; 

(d)  an  order  passed  by  the  Board  or  the 2[Principal  Commissioner  of  Central  Excise  or 
Commissioner of Central Excise], either before or after the appointed day, under Section 35-A, as it 
stood immediately before that day: 

3[Provided that no appeal shall lie to the Appellate Tribunal and the Appellate Tribunal shall not 
have jurisdiction to decide any appeal in respect of any order referred to in clause (b) if such order 
relates to,— 

(a) a case of loss of goods, where the loss occurs in transit from a factory to a warehouse or to 
another factory, or from one warehouse to another, or during the course of processing of the goods in 
a warehouse or in storage, whether in a factory or in a warehouse; 

(b) a rebate of duty of excise on goods exported to any country or territory outside India or on 
excisable materials used in the manufacture of goods which are exported to any country or territory 
outside India; 

(c) goods exported outside India (except to Nepal or Bhutan) without payment of duty; 

4[(d) credit of any duty allowed to be utilised towards payment of excise duty on final products 
under  the  provisions  of  this  Act  or  the  rules  made  thereunder  and  such  order  is  passed  by  the 
Commissioner (Appeals) on or after the date appointed under Section 109 of the Finance (No. 2) Act, 
1998:] 

Provided further that] the Appellate Tribunal may, in its discretion, refuse to admit an appeal in 

respect of an order referred to in clause (b) or clause (c) or clause (d) where— 

(i) in any disputed case, other than a case where the determination of any question having a relation 
to the rate of duty of excise or to the value of goods for purposes of assessment is in issue or is one of 
the points in issue, the difference in duty involved or the duty involved; or 

(ii) the amount of fine or penalty determined by such order, does not exceed 5[two lakh rupees]. 

6[(1A) Every appeal against any order of the nature referred to in the first proviso to sub-section (1), 

which is pending immediately before the commencement of Section 47 of the Finance Act, 1984, before 

1. Subs. by Act 22 of 1995, Section 70, for “Collector (Appeals)” (w.e.f. 26-5-1995). 
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
3. Subs. by Act 21 of 1984, s. 47, for “Provided that” (w.e.f. 11-5-1984). 
4. Ins. by Act 21 of 1998, s. 109 (w.e.f. 1-8-1998). 
5. Subs. by Act 25 of 2014, s. 102(a), for “fifty thousand rupees”. 
6. Ins. by Act 21 of 1984, s. 47(b) (w.e.f. 11-5-1984). 

66 

 
                                                           
the Appellate Tribunal and any matter arising out of, or connected with, such appeal and which is so pending 

shall stand transferred on such commencement to the Central Government,  and the Central Government 

shall deal with such appeal or matter under Section 35-EE as if such appeal or matter were an application 

or a matter arising out of an application made to it under that section.] 

1[(1B) (i) The Central Board of Excise and Customs constituted under the Central Boards of Revenue 

Act, 1963 (54 of 1963) may, 2[by order], constitute such Committees as may be necessary for the purposes 

of this Act. 

(ii) Every Committee constituted under clause (i) shall consist of two 3[Principal Chief Commissioner 

of Central Excise or Chief Commissioner of Central Excise] or two 4[Principal Commissioner of Central 

Excise or Commissioner of Central Excise], as the case may be.] 

5[(2) 6[The Committee of Commissioners of Central Excise may, if it is] is of opinion that an order 

passed by the Appellate 4[Principal Commissioner of Central Excise or Commissioner of Central Excise] 
under Section 35, as it stood immediately before the appointed day, or the 7[Commissioner (Appeals)] under 

Section 35-A, is not legal or proper, direct any Central Excise Officer authorised by him in this behalf 
(hereafter in this Chapter referred to as the authorised officer) to appeal 8[on its behalf] to the Appellate 

Tribunal against such order.] 

9[Provided that where the Committee of 4[Principal Commissioner of Central Excise or Commissioner 

of  Central  Excise]  differs  in  its  opinion  regarding  the  appeal  against  the  order  of  the  Commissioner 

(Appeals),  it  shall  state  the  point  or  points  on  which  it  differs  and  make  a  reference  to  the 
jurisdictional 3[Principal Chief Commissioner of Central Excise or Chief Commissioner of Central Excise] 

who  shall,  after  considering  the  facts  of  the  order,  if  is  of  the  opinion  that  the  order  passed  by  the 

Commissioner (Appeals) is not legal or proper, direct any Central Excise Officer to appeal to the Appellate 

Tribunal against such order. 

Explanation.—For the purposes of this sub-section, “jurisdictional Chief Commissioner” means 
the 3[Principal Chief Commissioner of Central Excise or Chief Commissioner of Central Excise] having 
jurisdiction over the adjudicating authority in the matter.] 

1. Ins. by Act 18 of 2005, s. 79. 
2. Subs. by Act 25 of 2014, s. 102(b), for “by notification in the Official Gazette”. 
3. Subs. by ibid, s. 95, for “Chief Commissioner of Central Excise”. 
4. Subs. by ibid, s. 95, for “Commissioner of Central Excise”. 
5. Subs. by Act 62 of 1986, s. 34(a)(i), for sub-section (2).  
6. Subs. by Act 18 of 2005, s. 79, for “The Commissioner of Central Excise may, if he is.  
7. Subs. by Act 22 of 1995, s. 70, for “Collector (Appeals)” (w.e.f. 26-5-1995).  
8. Subs. by Act 18 of 2005, s. 79(a)(ii), for “on his behalf”. 
9. Ins. by Act 18 of 2008, s. 83. 

67 

 
                                                           
(3) Every appeal under this section shall be filed within three months from the date on which the order 
sought  to  be  appealed  against  is  communicated  to  the 1[Principal  Commissioner  of  Central  Excise  or 

Commissioner of Central Excise], or, as the case may be, the other party preferring the appeal. 

(4) On receipt of notice that an appeal has been preferred under this section, the party against whom 

the appeal has been preferred may, notwithstanding that he may not have appealed against such order or 

any part thereof, file, within forty-five days of the receipt of the notice, a memorandum of cross-objections 

verified in the prescribed manner against any part of the order appealed against and such memorandum 

shall be disposed of by the Appellate Tribunal as if it were an appeal presented within the time specified in 

sub-section (3). 

(5)  The  Appellate  Tribunal  may  admit  an  appeal  or  permit  the  filing  of  a  memorandum  of  cross-

objections after the expiry of the relevant period referred to in sub-section (3) or sub-section (4), if it is 

satisfied that there was sufficient cause for not presenting it within that period. 

2[(6) An appeal to the Appellate Tribunal shall be in the prescribed form and shall be verified in the 

prescribed manner and shall, irrespective of the date of demand of duty and interest or of levy of penalty in 

relation to which the appeal is made, be accompanied by a fee of,— 

(a)  where  the  amount  of  duty  and  interest  demanded  and  penalty  levied  by  any  Central  Excise 

Officer in the case to which the appeal relates is five lakh rupees or less, one thousand rupees; 

(b)  where  the  amount  of  duty  and  interest  demanded  and  penalty  levied  by  any  Central  Excise 
Officer in the case to which the appeal relates is more than five lakh rupees but not exceeding fifty lakh 
rupees, five thousand rupees; 

(c)  where  the  amount  of  duty  and  interest  demanded  and  penalty  levied  by  any  Central  Excise 

Officer in the case to which the appeal relates is more than fifty lakh rupees, ten thousand rupees: 

Provided  that  no  such  fee  shall  be  payable  in  the  case  of  an  appeal  referred  to  in                                        

sub-section (2) or a memorandum of cross-objections referred to in sub-section (4). 

(7) Every application made before the Appellate Tribunal,— 

(a) in an appeal 3[* * *] for rectification of mistake or for any other purpose; or 

(b) for restoration of an appeal or an application, 

shall be accompanied by a fee of five hundred rupees: 

1. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
2. Subs. by Act 23 of 2004, s. 83, for sub-section (6) (w.e.f. 1-11-2004). 
3. The word “for grant of stay or” omitted by Act 25 of 2014, s. 102(c). 

68 

 
                                                           
Provided that no such fee shall be payable in the case of an application filed by or on behalf of 

the 1[Principal  Commissioner  of  Central  Excise  or  Commissioner  of  Central  Excise]  under  this                    
sub-section.] 

35-C. Orders of Appellate Tribunal.—(1) The Appellate Tribunal may, after giving the parties to the 

appeal an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or 

annulling the decision or order appealed against or may refer the case back to the authority which passed 

such decision or order with such directions as the Appellate Tribunal may think fit, for a fresh adjudication 

or decision, as the case may be, after taking additional evidence, if necessary. 

2[(1A) The Appellate Tribunal may, if sufficient cause is shown, at any stage of hearing of an appeal, 

grant time, from time to time, to the parties or any of them and adjourn the hearing of the appeal for reasons 

to be recorded in writing: 

Provided that no such adjournment shall be granted more than three times to a party during hearing 

of the appeal.] 

(2) The Appellate Tribunal may, at any time within 3[six months] from the date of the order, with a 

view  to  rectifying  any  mistake  apparent  from  the  record,  amend  any  order  passed  by  it  under                             

sub-section (1) and shall make such amendments if the mistake is brought to its notice by the 1[Principal 

Commissioner of Central Excise or Commissioner of Central Excise] or the other party to the appeal: 

Provided that an amendment which has the effect of enhancing an assessment or reducing a refund 
or otherwise increasing the liability of the other party, shall not be made under this sub-section, unless 
the Appellate Tribunal has given notice to him of its intention to do so and has allowed him a reasonable 
opportunity of being heard. 

4[(2A) The Appellate Tribunal shall, where it is possible to do so, hear and decide every appeal within 

a period of three years from the date on which such appeal is filed: 

5[* * *] 

(3) The Appellate Tribunal shall send a copy of every order passed under this section to the  1[Principal 

Commissioner of Central Excise or Commissioner of Central Excise] and the other party to the appeal. 

1. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
2. Ins. by Act 23 of 2004, s. 84. 
3. Subs. by Act 20 of 2002, s. 140(i), for “four years”. 
4. Ins. by ibid, s. 140(ii). 
5. First, Second & Third Proviso omitted by Act 25 of 2014, s. 103. 

69 

 
 
                                                           
(4) 1[Save as provided in the National Tax Tribunal Act, 2005] orders passed by the Appellate Tribunal 

on appeal shall be final. 

35D. Procedure of Appellate Tribunal.—(1) The provisions of sub-sections (1), (2), (5) and (6) of 

Section 129-C of the Customs Act, 1962 (52 of 1962), shall apply to the Appellate Tribunal in the discharge 

of its functions under this Act as they apply to it in the discharge of its functions under the Customs Act, 

1962 (52 of 1962). 

(2) 2[* * *] 

(3)  The  President  or  any  other  member  of  the  Appellate  Tribunal  authorised  in  this  behalf  by  the 

President may, sitting singly, dispose of any case which has been allotted to the Bench of which he is a 

member where— 

(a) in any disputed case, other than a case where the determination of any question having a relation 
to the rate of duty of excise or to the value of goods for purposes of assessment is in issue or is one of 
the points in issue, the difference in duty involved or the duty involved; or 

(b) the amount of fine or penalty involved, does not exceed 3[fifty lakh rupees]. 

35E.  Powers  of  4[Committee  of   5[Principal  Chief  Commissioner  of  Central  Excise  or  Chief 
Commissioners of Central Excise] or 6[Principal Commissioner of Central Excise or Commissioners 

of Central Excise]] to pass certain orders.—(1) The  4[Committee of 5[Principal Chief Commissioners of 

Central Excise or Commissioner of Central Excise]] or may, of its own motion, call for and examine the 

record  of  any  proceeding  in  which  a   6[Principal  Commissioner  of  Central  Excise  or  Commissioner  of 

Central Excise]] as an adjudicating authority has passed any decision or order under this Act for the purpose 

of satisfying itself as to the legality or propriety of any such decision or order and may, by order, direct 
such  7[Commissioner 8[or any other Commissioner]] to apply to the Appellate Tribunal 9[or, as the case 

may be, the Customs and Excise Revenues Appellate Tribunal established under Section 3 of the Customs 

and Excise Revenues Appellate Tribunal Act, 1986] for the determination of such points arising out of the 

decision or order as may be specified by the  4[Committee of 5[Principal Chief Commissioners of Central 

Excise or Commissioner of Central Excise]] in its order: 

1. Subs. by Act 49 of 2005, s. 30 and Sch. (Pt. VII-5), for “Save as provided in section 35G or section 35L” (w.e.f. 28-12-2005). 
2. Sub-section (2) omitted by Act 22 of 1995, s. 77 (w.e.f. 26-5-1995). 
3. Subs. by Act 17 of 2013, s. 99, for “ten lakh rupees” (w.e.f. 10-5-2013). 
4. Subs. by Act 18 of 2005, s. 80, for “Board” (w.e.f. 13-5-2005). 
5. Subs. by Act 25 of 2014, s. 95, for “Chief Commissioner of Central Excise” (w.e.f. 6-8-2014). 
6. Subs. by ibid., s. 95, for “Commissioner of Central Excise” (w.e.f. 6-8-2014). 
7. Subs. by Act 22 of 1995, s. 70, for “Collector” (w.e.f. 26-5-1995). 
8.  Ins. by Act 14 of 2001, s. 129. 
9.  Ins. by Act 62 of 1986, s. 34, w.e.f. the appointed day under that Act. 

70 

 
                                                           
1[Provided that where the Committee of 2[Principal Chief Commissioners of Central Excise or Chief 

Commissioner of Central Excise] differs in its opinion as to the legality or propriety of the decision or order 

of the 3[Principal Commissioner of Central Excise or Commissioner of Central Excise], it shall state the 

point or points on which it differs and make a reference to the Board which, after considering the facts of 

the decision or order, if is of the opinion that the decision or order passed by the 3[Principal Commissioner 

of Central Excise or Commissioner of Central Excise] is not legal or proper, may, by order, direct such 

Commissioner or any other Commissioner to apply to the Appellate Tribunal for the determination of such 

points arising out of the decision or order, as may be specified in its order.] 

(2) The  3[Principal Commissioner of Central Excise or Commissioner of Central Excise] may, of his 

own  motion,  call  for  and  examine  the  record  of  any  proceeding  in  which  an  adjudicating  authority 

subordinate to him has passed any decision or order under this Act for the purpose of satisfying himself as 

to the legality or propriety of any such decision or order and may, by order, direct 4[such authority or any 
Central Excise Officer subordinate to him] to apply to the 5[Commissioner (Appeals)] for the determination 

of such points arising out of the decision or order as may be specified by the 3[Principal Commissioner of 

Central Excise or Commissioner of Central Excise] in his order. 

6[(3) Every order under sub-section (1) or sub-section (2), as the case may be, shall be made within a 

period  of  three  months  from  the  date  of  communication  of  the  decision  or  order  of  the  adjudicating                

authority:] 

7[Provided that the Board may, on sufficient cause being shown, extend the said period by another thirty 

days.] 

(4) Where in pursuance of an order under sub-section (1) or sub-section (2), the adjudicating authority 
or  the  authorised  officer  makes  an  application  to  the  Appellate  Tribunal 8[or,  as  the  case  may  be,  the 

Customs and Excise Revenues Appellate Tribunal established under Section 3 of the Customs and Excise 
Revenues Appellate Tribunal Act, 1986] or the 5[Commissioner (Appeals)] within a period of 9[one month] 

from the date of communication of the order under sub-section (1) or sub-section (2) to the adjudicating 
authority, such application shall be heard by the Appellate Tribunal  8[or, as the case may be, the Customs 

and Excise Revenues Appellate Tribunal established under Section 3 of the Customs and Excise Revenues 
Appellate Tribunal Act, 1986] or the 5[Commissioner (Appeals)], as the case may be, as if such application 

1. Ins. by Act 18 of 2008, s. 84(i). 
2. Subs. by Act 25 of 2014, s. 95, for “Chief Commissioner of Central Excise” (w.e.f. 6-8-2014). 
3. Subs. by ibid., s. 95, for “Commissioner of Central Excise” (w.e.f. 6-8-2014). 
4. Subs. by Act 29 of 2006, s. 37, for “such authority”. 
5. Subs. by Act 22 of 1995, s. 70, for “Collector (Appeals)” (w.e.f. 26-5-1995). 
6. Subs. by Act 18 of 2008, s. 84(ii), for sub-section (3) (w.e.f. 10-5-2008). 
7. Ins. by Act 25 of 2014, s. 104. 
8. Ins. by Act 62 of 1986, s. 34, w.e.f. the appointed day under that Act. 
9. Subs. by Act 22 of 2007, s. 130, for “three months”. 

71 

 
                                                           
were an appeal made against the decision or order of the adjudicating authority and the provisions of this 
Act regarding appeals, including the provisions of sub-section (4) of Section 35-B, 1[or, as the case may be, 

the provisions of the Customs and Excise Revenues Appellate Tribunal Act, 1986] shall, so far as may be, 

apply to such application. 

2[(5) The provisions of this section shall not apply to any decision or order in which the determination 

of any question having a relation to the rate of duty of excise or to the value of goods for the purposes of 

assessment of any duty is in issue or is one of the points in issue. 

Explanation.—For the purposes of this sub-section, the determination of a rate of duty in relation 
to  any  goods  or  valuation  of  any  goods  for  the  purposes  of  assessment  of  duty  includes  the 
determination of a question— 

(a) relating to the rate of duty of excise for the time being in force, whether under the Central Excise 
Tariff Act, 1985 (5 of 1986), or under any other Central Act providing for the levy and collection of 
any duty of excise, in relation to any goods on or after the 28th day of February, 1986; or 

(b) relating to the value of goods for the purposes of assessment of any duty of excise in cases 

where the assessment is made on or after the 28th day of February, 1986; or 

(c) whether any goods are excisable goods or whether the rate of duty of excise on any goods is nil; 

or 

(d) whether any goods fall under a particular heading or sub-heading of the 3[First Schedule and 
the Second Schedule] to the Central Excise Tariff Act, 1985 (5 of 1986), or the Additional Duties of 
Excise  (Goods  of  Special  Importance)  Act,  1957  (58  of  1957),  or  the  Additional  Duties  of  Excise 
(Textiles  and  Textile  Articles)  Act,  1978  (40  of  1978),  or  that  any  goods  are  or  not  covered  by  a 
particular notification or order issued by the Central Government or the Board, as the case may be, 
granting total or partial exemption from duty; or 

(e)  whether  the  value  of  any  goods  for  the  purposes  of  assessment  of  duty  of  excise  shall  be 
enhanced  or  reduced  by  the  addition  or  reduction  of  the  amounts  in  respect  of  such  matters  as  are 
specifically provided in this Act.] 

4[35EA.  Powers  of  revision  of  Board  or 5[Principal  Commissioner  of  Central  Excise  or 

Commissioner of Central Excise] in certain cases.—(1) The Board may, of its own motion or on the 

application of any aggrieved person or otherwise, call for and examine the record of any proceeding in 
which a 5[Principal Commissioner of Central Excise or Commissioner of Central Excise] has passed any 

decision or order [not being a decision or order passed under sub-section (2) of this section] of the nature 

1. Ins. by Act 62 of 1986, s. 34, w.e.f. the appointed day under that Act. 
2. Ins. by Act 29 of 1988, s. 11 (w.e.f. a date to be notified). 
3. Subs. by Act 27 of 1999, s. 119, for “the Schedule”. 
4. Ins. by Act 29 of 1988, s. 12 (w.e.f. a date to be notified). 
5. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 

72 

 
                                                           
referred to in sub-section (5) of Section 35-E for the purpose of satisfying itself as to correctness, legality 

or propriety of such decision or order and may pass such order thereon as it thinks fit. 

(2) The 1[Principal Commissioner of Central Excise or Commissioner of Central Excise] may, of his 

own motion or on the application of any aggrieved person or otherwise, call for and examine the record of 

any proceeding in which an adjudicating authority subordinate to him has passed any decision or order of 

the  nature  referred  to in  sub-section  (5)  of  Section  35-E  for  the  purpose  of  satisfying  himself  as  to  the 

correctness, legality or propriety of such decision or order and may pass such order thereon as he thinks fit. 

(3) (a) No decision or order under this section shall be made so as to prejudicially affect any person 

unless such person is given a reasonable opportunity of making representation and if, he so desires, of being 

heard in his defence. 

(b)  Where  the  Board  or,  as  the  case  may  be,  the 1[Principal  Commissioner  of  Central  Excise  or 

Commissioner of Central Excise] is of the opinion that any duty of excise has not been levied or has been 

short-levied or short-paid or erroneously refunded, no order requiring the affected person to pay any duty 

not levied or paid, short-levied or short-paid or erroneously refunded shall be passed under this section 

unless such person is given notice within the time-limit specified in Section 11-A to show cause against the 

proposed order. 

(4) No proceedings shall be initiated under sub-section (1) or sub-section (2) in respect of any decision 

or order after the expiry of a period of six months from the date of communication of such decision or order: 

Provided that in respect of any decision or order passed before the commencement of the Customs 
and Central Excises Laws (Amendment) Act, 1988, the provisions of this sub-section shall have effect 
as if for the words “six-months”, the words “one year” were substituted. 

(5) Any person aggrieved by any decision or order passed under sub-section (1) or sub-section (2) may 

appeal to the Customs and Excise Revenues Appellate Tribunal established under Section 3 of the Customs 

and Excise Revenues Appellate Tribunal Act, 1986 (62 of 1986), against such decision or order.] 

2[35EE. Revision by Central Government.— (1) The Central Government may, on the application of 

any person aggrieved by any order passed under Section 35-A, where the order is of the nature referred to 

in the first proviso to sub-section (1) of Section 35-B, annul or modify such order: 

3[Provided that the Central Government may in its discretion, refuse to admit an application in respect 

of an order where the amount of duty or fine or penalty, determined by such order does not exceed five 

thousand rupees.] 

1. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
2. Ins. by Act 21 of 1984, s. 50 (w.e.f. 11-5-1984). 
3. Ins. by Act 27 of 1999, s. 126(a) (w.e.f. 11-5-1999). 

73 

 
                                                           
Explanation.—For the purposes of this sub-section, “order passed under Section 35-A” includes an 
order passed under that section before the commencement of Section 47 of the Finance Act, 1984 (21 
of 1984) against which an appeal has not been preferred before such commencement and could have 
been, if the said section had not come into force, preferred after such commencement, to the Appellate 
Tribunal. 

1[(1A) The 2[Principal Commissioner of Central Excise or Commissioner of Central Excise] may, if he 

is of the opinion that an order passed by the Commissioner (Appeals) under Section 35-A is not legal or 

proper, direct the proper officer to make an application on his behalf to the Central Government for revision 

of such order.] 

(2)  An  application  under  sub-section  (1)  shall  be  made  within  three  months  from  the  date  of  the 

communication to the applicant of the order against which the application is being made: 

Provided that the Central Government may, if it is satisfied that the applicant was prevented by 
sufficient cause from presenting the application within the aforesaid period of three months, allow it to 
be presented within a further period of three months. 

3[(3) An application under sub-section (1) shall be in such form and shall be verified in such manner as 

may be specified by rules made in this behalf and shall be accompanied by a fee of,— 

(a) two hundred rupees, where the amount of duty and interest demanded, fine or penalty levied by 

any Central Excise Officer in the case to which the application relates is one lakh rupees or less; 

(b) one thousand rupees, where the amount of duty and interest demanded, fine or penalty levied 
by any Central Excise Officer in the case to which the application relates is more than one lakh rupees: 

Provided that no such fee shall be payable in the case of an application referred to in sub-section 

(1A).] 

(4)  The  Central  Government  may,  of  its  own  motion,  annul  or  modify  any  order  referred  to  in                           

sub-section (1). 

(5) No order enhancing any penalty or fine in lieu of confiscation or confiscating goods of greater value 

shall be passed under this section,— 

(a) in any case in which an order passed under Section 35A has enhanced any penalty or fine in 

lieu of confiscation or has confiscated goods of greater value, and 

(b) in any other case, unless the person affected by the proposed order has been given notice to 

show cause against it within one year from the date of the order sought to be annulled or modified. 

1. Ins. by Act 27 of 1999, s. 126(b) (w.e.f. 11-5-1999).  
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 
3. Subs. by Act 27 of 1999, s. 126(c), for sub-section (3) (w.e.f. 11-5-1999). 

74 

 
                                                           
(6) Where the Central Government is of opinion that any duty of excise has not been levied or has been 

short-levied, no order levying or enhancing the duty shall be made under this section unless the person 

affected by the proposed order is given notice to show cause against it within the time-limit specified in 

Section 11A.] 

1[35F. Deposit of certain percentage of duty demanded or penalty imposed before filing appeal.—

The Tribunal or the Commissioner (Appeals), as the case may be, shall not entertain any appeal— 

(i) under sub-section (1) of Section 35, unless the appellant has deposited seven and a half per cent 
of the duty, in case where duty or duty and penalty are in dispute, or penalty, where such penalty is in 
dispute, in pursuance of a decision or an order passed by an officer of Central Excise lower in rank than 
the 2[Principal Commissioner of Central Excise or Commissioner of Central Excise]; 

(ii) against the decision or order referred to in clause (a) of sub-section (1) of Section 35-B, unless 
the appellant has deposited seven and a half per cent of the duty, in case where duty or duty and penalty 
are  in  dispute,  or  penalty,  where  such  penalty  is  in  dispute,  in  pursuance  of  the  decision  or  order 
appealed against; 

(iii) against the decision or order referred to in clause (b) of sub-section (1) of Section 35-B, unless 
the  appellant  has  deposited  ten  per  cent  of  the  duty,  in  case  where  duty  or  duty  and  penalty  are  in 
dispute, or penalty, where such penalty is in dispute, in pursuance of the decision or order appealed 
against: 

Provided that the amount required to be deposited under this section shall not exceed Rupees 

Ten crores: 

Provided further that the provisions of this section shall not apply to the stay applications and 
appeals pending before any appellate authority prior to the commencement of the Finance (No. 2) 
Act, 2014. 

Explanation.—For the purposes of this section “duty demanded” shall include,— 

(i) amount determined under Section 11D; 

(ii) amount of erroneous CENVAT credit taken; 

(iii) amount payable under Rule 6 of the CENVAT Credit Rules, 2001 or the CENVAT Credit 

Rules, 2002 or the CENVAT Credit Rules, 2004.] 

3[35FF. Interest on delayed refund of amount deposited under Section 35F.—Where an amount 

deposited by the appellant under Section 35F is required to be refunded consequent upon the order of the 

appellate authority, there shall be paid to the appellant interest at such rate, not below five per cent and not 

1. Subs. by Act 25 of 2014, s. 105, for section 35F (w.e.f. 6-8-2014).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
2. Subs. by ibid, s. 95, for “Commissioner of Central Excise”. 
3. Subs. by ibid, s. 106, for section 35FF.  

75 

 
                                                           
exceeding  thirty-six  per  cent  per  annum  as  is  for  the  time  being  fixed  by  the  Central  Government,  by 

notification in the Official Gazette, on such amount from the date of payment of the amount till, the date of 

refund of such amount: 

Provided that the amount deposited under Section 35F, prior to the commencement of the Finance 
(No. 2) Act, 2014, shall continue to be governed by the provisions of Section 35FF as it stood before 
the commencement of the said Act.] 

[35G. Appeal to High Court].— Omitted by The National Tax Tribunal Act, 2005 (Act 49 of 2005), s. 

30 and Sch., Pt. VII-6 (w.e.f. 28-12-2005). 

[35H. Application to High Court.]— Omitted by ibid, s. 30 and Sch., Pt. VII-6 (w.e.f. 28-12-2005). 

[35I. Power of High Court or Supreme Court to require statement to be amended.]— Omitted by  

The National Tax Tribunal Act, 2005 (Act 49 of 2005), s. 30 and Sch., Pt. VII-6 (w.e.f. 28-12-2005). 

[35J. Case before High Court to be heard by not less than two judges.]— Omitted by ibid, s. 30 and 

Sch., Pt. VII-6 (w.e.f. 28-12-2005). 

35K. Decision of High Court or Supreme Court on the case stated.—(1) The 1[* * *] Supreme Court 

hearing any such case shall decide the questions of law raised therein and shall deliver its judgment thereon 

containing the grounds on which such decision is founded and a copy of the judgment shall be sent under 

the seal of the Court and the signature of the Registrar to the Appellate Tribunal which shall pass such 

orders as are necessary to dispose of the case in conformity with such judgment. 

2[(1A) Where the High Court delivers a judgment in an appeal filed before it under Section 35G, effect 

shall be given to the order passed on the appeal by the concerned Central Excise Officer on the basis of a 

certified copy of the judgment.] 

(2) The costs of any 3[reference to 4[***] an appeal to 4[* * *] the Supreme Court,  5[* * *]] which shall 

not include the fee for making the reference shall be in the discretion of the Court. 

35L. Appeal to Supreme Court.— 6[(1)] An appeal shall lie to the Supreme Court from— 

7[(a) any judgment of the High Court delivered— 

(i) in an appeal made under Section 35G; or 

1.  The words “High Court or the” omitted by Act 49 of 2005, s. 30 and Sch. (Pt. VII-7) (w.e.f. 28-12-2005). 
2. Ins. by Act 32 of 2003, s. 146(a) (w.e.f. 1-7-2003). 
3. Subs. by ibid, s. 146, for “reference to the High Court or the Supreme Court” (w.e.f. 14-5-2003). 
4. The words “the High Court or” omitted by Act 49 of 2005, s. 30 and Sch. (Pt. VII-7(ii)(a)) (w.e.f. 28-12-2005). 
5. The words “as the case may be” omitted by ibid, s. 30 and Sch. (Pt. VII-7(ii)(b)) (w.e.f. 28-12-2005). 
6. Renumbered by Act 25 of 2014, s. 107. 
7. Subs. by Act 32 of 2003, s. 147, for clause (a) (w.e.f. 14-5-2003). 

76 

 
                                                           
(ii) on a reference made under Section 35G by the Appellate Tribunal before the 1st day of July, 

2003; 

(iii) on reference made under Section 35H, 

in any case which, on its own motion or on an oral application made by or on behalf of the party 
aggrieved, immediately after the passing of the judgment, the High Court certifies to be a fit one for 
appeal to the Supreme Court; or] 

(b) any order passed   1[before the establishment of the National Tax Tribunal] by the Appellate 
Tribunal relating, among other things, to the determination of any question having a relation to the rate 
of duty of excise or to the value of goods for purposes of assessment. 

2[(2) For the purposes of this Chapter, the determination of any question having a relation to the rate of 

duty shall include the determination of taxability or excisability of goods for the purpose of assessment.] 

35M. Hearing before Supreme Court.—(1) The provisions of the Code of Civil Procedure, 1908, (5 

of 1908) relating to appeals to the Supreme Court shall, so far as may be, apply in the case of appeals under 

Section 35L as they apply in the case of appeals from decrees of a High Court: 

Provided that nothing in this sub-section shall be deemed to affect the provisions of sub-section (1) 

of Section 35K or Section 35N. 

(2) The costs of the appeal shall be in the discretion of the Supreme Court. 

(3) Where the judgment of the High Court is varied or reversed in the appeal, effect shall be given to 

the order of the Supreme Court in the manner provided in Section 35-K in the case of a judgment of the 

High Court. 

35N. Sums due to be paid notwithstanding reference, etc.—Notwithstanding that a reference has 

been  made  to  the  High  Court  or  the  Supreme  Court  or  an  appeal  has  been  preferred  to  the  Supreme 
Court 3[under this Act before the commencement of the National Tax Tribunal Act, 2005], sums due to the 

Government  as  a  result  of  an  order  passed  under  sub-section  (1)  of  Section  35C  shall  be  payable  in 

accordance with the order so passed. 

35O.  Exclusion  of  time  taken  for  copy.—In  computing  the  period  of  limitation  prescribed  for  an 

appeal or application under this Chapter, the day on which the order complained of was served, and if the 

party preferring the appeal or making the application was not furnished with a copy of the order when the 

notice of the order was served upon him, the time requisite for obtaining a copy of such order shall be 

excluded. 

1. Ins. by Act 49 of 2005, s. 30 and Sch. (Pt. VII-8) (w.e.f. 28-12-2005). 
2. Ins. by Act 25 of 2014, s. 107. 
3. Ins. by Act 49 of 2005, s. 30 and Sch. (Pt. VII-9) (w.e.f. 28-12-2005). 

77 

 
                                                           
35P. Transfer of certain pending proceedings and transitional provisions.—(1) Every appeal which 

is pending immediately before the appointed day before the Board under Section 35, as it stood immediately 

before that day, and any matter arising out of or connected with such appeal and which is so pending shall 

stand transferred on that day to the Appellate Tribunal and the Appellate Tribunal may proceed with such 

appeal or matter from the stage at which it was on that day: 

Provided that the appellant may demand that before proceeding further with that appeal or matter, 

he may be re-heard. 

(2)  Every  proceeding  which  is  pending  immediately  before  the  appointed  day  before  the  Central 

Government under Section 36, as it stood immediately before that day, and any matter arising out of or 

connected with such proceeding and which is so pending shall stand transferred on that day to the Appellate 

Tribunal and the Appellate Tribunal may proceed with such proceeding or matter from the stage at which 

it was on that day as if such proceeding or matter were an appeal filed before it: 

Provided that if any such proceeding or matter relates to an order where— 

(a) in any disputed case, other than a case where the determination of any question having a relation 
to the rate of duty of excise or to the value of goods for purposes of assessment is in issue or is one of 
the points in issue, the difference in duty involved or the duty involved; or 

(b) the amount of fine or penalty determined by such order, 

does not exceed ten thousand rupees, such proceeding or matter shall continue to be dealt with by the 
Central Government as if the said Section 36 had not been substituted: 

Provided further that the applicant or the other party may make a demand to the Appellate Tribunal 

that before proceeding further with that proceeding or matter, he may be reheard. 

(3)  Every  proceeding  which  is  pending  immediately  before  the  appointed  day  before  the  Board  or 

the 1[Principal Commissioner of Central Excise or Commissioner of Central Excise] under Section 35-A, 

as it stood immediately before that day, and any matter arising out of or connected with such proceeding 

and which is so pending shall continue to be dealt with by the Board or the 1[Principal Commissioner of 

Central Excise or Commissioner of Central Excise], as the case may be, as if the said section had not been 

substituted. 

(4) Any person who immediately before the appointed day was authorised to appear in any appeal or 

proceeding transferred under sub-section (1) or sub-section (2) shall, notwithstanding anything contained 

in  Section  35-Q,  have  the  right  to  appear  before  the  Appellate  Tribunal  in  relation  to  such  appeal  or 

proceeding. 

1. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 

78 

 
                                                           
35Q.  Appearance  by  authorised  representative.—(1)  Any  person  who  is  entitled  or  required  to 

appear before a Central Excise Officer or the Appellate Tribunal in connection with any proceedings under 

this  Act,  otherwise  than  when  required  under  this  Act  to  appear  personally  for  examination  on  oath  or 

affirmation, may, subject to the other provisions of this section, appear by an authorised representative. 

(2) For the purposes of this section, “authorised representative” means a person authorised by the person 

referred to in sub-section (1) to appear on his behalf, being— 

(a) his relative or regular employee; or 

(b) any legal practitioner who is entitled to practise in any civil court in India; or 

(c) any person who has acquired such qualifications as the Central Government may prescribe for 

this purpose. 

(3) Notwithstanding anything contained in this section, no person who was a member of the Indian 

Customs and Central Excise Service—Group A and has retired or resigned from such Service after having 

served for not less than three years in any capacity in that Service, shall be entitled to appear as an authorised 

representative in any proceedings before a Central Excise Officer for a period of two years from the date 

of his retirement or resignation, as the case may be. 

(4) No person,— 

(a) who has been dismissed or removed from Government service; or 

(b) who is convicted of an offence connected with any proceeding under this Act, the Customs Act, 

1962 (52 of 1962) or the Gold (Control) Act, 1968 (45 of 1968)1 or 

(c) who has become an insolvent, 

shall be qualified to represent any person under sub-section (1), for all times in the case of a person 
referred  to  in  clause  (a),  and  for  such  time  as  the 2[Principal  Commissioner  of  Central  Excise  or 
Commissioner of Central Excise] or the competent authority under the Customs Act, 1962 or the Gold 
(Control) Act, 1968 (45 of 1968)1, as the case may be, may, by order, determine in the case of a person 
referred to in clause (b), and for the period during which the insolvency continues in the case of a person 
referred to in clause (c). 

(5) If any person,— 

(a) who is a legal practitioner, is found guilty of misconduct in his professional capacity by any 
authority entitled to institute proceedings against him, an order passed by that authority shall have effect 

1. Repealed by Act 18 of 1990, s. 2. 
2. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”. 

79 

 
                                                           
in relation to his right to appear before a Central Excise Officer or the Appellate Tribunal as it has in 
relation to his right to practise as a legal practitioner; 

(b) who is not a legal practitioner, is found guilty of misconduct in connection with any proceedings 
under this Act by the prescribed authority, the prescribed authority may direct that he shall thenceforth 
be disqualified to represent any person under sub-section (1). 

(6) Any order or direction under clause (d) of sub-section (4) or clause (b) of sub-section (5) shall be 

subject to the following conditions, namely:— 

(a) no such order or direction shall be made in respect of any person unless he has been given a 

reasonable opportunity of being heard; 

(b) any person against whom any such order or direction is made may, within one month of the 

making of the order or direction, appeal to the Board to have the order or direction cancelled; and 

(c) no such order or direction shall take effect until the expiration of one month from the making 

thereof, or, where an appeal has been preferred, until the disposal of the appeal. 

1[35R. Appeal not to be filed in certain cases.—(1) The Central Board of Excise and Customs may, 

from time to time, issue orders or instructions or directions fixing such monetary limits, as it may deem fit, 

for the purposes of regulating the filing of appeal, application, revision or reference by the Central Excise 

Officer under the provisions of this chapter. 

(2) Where, in pursuance of the orders or instructions or directions, issued under sub-section (1), the 

Central Excise Officer has not filed an appeal, application, revision or reference against any decision or 

order passed under the provisions of this Act, it shall not preclude such Central Excise Officer from filing 

appeal, application, revision or reference in any other case involving the same or similar issues or questions 

of law. 

(3) Notwithstanding the fact that no appeal, application, revision or reference has been filed by the 

Central Excise Officer pursuant to the orders or instructions or directions issued under sub-section (1), no 

person,  being  a  party  in  appeal,  application, revision  or  reference shall  contend  that the  Central  Excise 

Officer has acquiesced in the decision on the disputed issue by not filing appeal, application, revision or 

reference. 

(4) 2[The Commissioner (Appeals) or the Appellate Tribunal or court] hearing such appeal, application, 

revision or reference shall have regard to the circumstances under which appeal, application, revision or 

reference was not filed by the Central Excise Officer in pursuance of the orders or instructions or directions 

issued under sub-section (1). 

1. Ins. by Act 8 of 2011, s. 69 (w.e.f. 8-4-2011). 
2. Subs. by Act 25 of 2014, s. 108, for “The Appellate Tribunal or court”. 

80 

 
                                                           
(5) Every order or instruction or direction issued by the Central Board of Excise and Customs on or 

after the 20th day of October, 2010, but before the date on which the Finance Bill, 2011 receives the assent 

of  the  President,  fixing  monetary  limits  for  filing  of  appeal,  application,  revision  or  reference  shall  be 

deemed to have been issued under sub-section (1) and the provisions of sub-sections (2), (3) and (4) shall 

apply accordingly.] 

36. Definitions.—In this Chapter— 

(a) “appointed day” means the date1 of coming into force of the amendments to this Act specified 

in Part II of the Fifth Schedule to the Finance (No. 2) Act, 1980 (44 of 1980); 

(b) “High Court” means,— 

(i) in relation to any State, the High Court for that State; 

(ii) in relation to a Union Territory to which the jurisdiction of the High Court of a State has 

been extended by law, that High Court; 

(iii) in relation to the Union Territories of Dadra and Nagar Haveli and 2[Daman and Diu,] the 

High Court at Bombay; 

(iv) in relation to any other Union Territory, the highest court of civil appeal for that territory 

other than the Supreme Court of India; 

(c) “President” means the President of the Appellate Tribunal.] 

3[CHAPTER VIB 

PRESUMPTION AS TO DOCUMENTS] 

4[36A. Presumption as to documents in certain cases.—Where any document is produced by any 

person or has been seized from the custody or control of any person, in either case, under this Act or under 

any other law and such document is tendered by the prosecution in evidence against him or against him and 

any other person who is tried jointly with him, the Court shall,— 

(a) unless the contrary is proved by such person, presume— 

(i) the truth of the contents of such document; 

(ii)  that  the  signature  and  every  other  part  of  such  document  which  purports  to  be  in  the 
handwriting  of  any  particular  person  or  which  the  Court  may  reasonably  assume  to  have  been 
signed by, or to be in the handwriting of, any particular person, is in that person's handwriting, and 

1. Came into force on 11-10-1982 vide G.S.R. 592 (E), dated 11th October, 1982. 
2. Subs. by Act 10 of 1989 the Goa, Daman & Diu Reorganisation Act, 1987 (w.e.f. 30-5-1987). 
3. Chapter heading ins. by Act 44 of 1980, s. 5 (w.e.f. 11-10-1982). 
4. Ins. by Act 36 of 1973, s. 23. 

81 

 
                                                           
in the case of a document executed or attested, that it was executed or attested by the person by 
whom it purports to have been so executed or attested; 

(b) admit the document in evidence, notwithstanding that it is not duly stamped, if such document 

is otherwise admissible in evidence.] 

1[36B.  Admissibility  of  microfilms,  facsimile  copies  of  documents  and  computer  printouts  as 

documents and as evidence.—(1) Notwithstanding anything contained in any other law for the time being 

in force,— 

(a)  a  microfilm  of  a  document  or  the  reproduction  of  the  image  or  images  embodied  in  such 

microfilm (whether enlarged or not); or 

(b) a facsimile copy of a document; or 

(c) a statement contained in a document and included in a printed material produced by a computer 
(hereinafter referred to as a “computer printout”), if the conditions mentioned in sub-section (2) and 
the other provisions contained in this section are satisfied in relation to the statement and the computer 
in question, 

shall be deemed to be also a document for the purposes of this Act and the rules made thereunder 
and  shall  be  admissible  in  any  proceedings  thereunder,  without  further  proof  or  production  of  the 
original, as evidence of any contents of the original or of any fact stated therein of which direct evidence 
would be admissible. 

(2) The conditions referred to in sub-section (1) in respect of a computer printout shall be the following, 

namely:— 

(a) the computer printout containing the statement was produced by the computer during the period 
over which the computer was used regularly to store or process information for the purposes of any 
activities regularly carried on over that period by the person having lawful control over the use of the 
computer; 

(b) during the said period, there was regularly supplied to the computer in the ordinary course of 
the said activities, information of the kind contained in the statement or of the kind from which the 
information so contained is derived; 

(c) throughout the material part of the said period, the computer was operating properly or, if not, 
then any respect in which it was not operating properly or was out of operation during that part of that 
period was not such as to affect the production of the document or the accuracy of the contents; and 

(d) the information contained in the statement reproduced or is derived from information supplied 

to the computer in the ordinary course of the said activities. 

1. Ins. by Act 29 of 1988, S. 13 (w.e.f. 1-7-1988). 

82 

 
                                                           
(3) Where over any period, the function of storing or processing information for the purposes of any 

activities regularly carried on over that period as mentioned in clause (a) of sub-section (2) was regularly 

performed by computers, whether— 

(a) by a combination of computers operating over that period; or 

(b) by different computers operating in succession over that period; or 

(c) by different combinations of computers operating in succession over that period; or 

(d) in any other manner involving the successive operation over that period, in whatever order, of 

one or more computers and one or more combinations of computers, 

all the computers used for that purpose during that period shall be treated for the purposes of this 
section as constituting a single computer; and references in this section to a computer shall be construed 
accordingly. 

(4)  In  any  proceedings  under  this  Act  and  the  rules  made  thereunder  where  it  is  desired  to  give  a 

statement in evidence by virtue of this section, a certificate doing any of the following things, that is to 

say,— 

(a) identifying the document containing the statement and describing the manner in which it was 

produced; 

(b) giving such particulars of any device involved in the production of that document as may be 

appropriate for the purpose of showing that the document was produced by a computer; 

(c) dealing with any of the matters to which the conditions mentioned in sub-section (2) relate, 

and purporting to be signed by a person occupying a responsible official position in relation to the 
operation of the relevant device or the management of the relevant activities (whichever is appropriate) 
shall be evidence of any matter stated in the certificate; and for the purposes of this sub-section it shall 
be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it. 

(5) For the purposes of this section,— 

(a) information shall be taken to be supplied to a computer if it is supplied thereto in any appropriate 
form and whether it is so supplied directly or (with or without human intervention) by means of any 
appropriate equipment; 

(b) whether in the course of activities carried on by any official, information is supplied with a view 
to its being stored or processed for the purposes of those activities by a computer operated otherwise 
than in the course of those activities, that information, if duly supplied to that computer, shall be taken 
to be supplied to it in the course of those activities; 

(c) a document shall be taken to have been produced by a computer whether it was produced by it 

directly or (with or without human intervention) by means of any appropriate equipment. 

83 

 
Explanation.—For the purposes of this section,— 

(a)  “computer”  means  any  device  that  receives,  stores  and  processes  data,  applying  stipulated 

processes to the information and supplying results of these processes; and 

(b) any reference to information being derived from other information shall be a reference to its 

being derived therefrom by calculation, comparison or any other process.] 

CHAPTER VII 

SUPPLEMENTAL PROVISIONS 

37. Power of Central Government to make rules.—(1) The Central Government may make rules to 

carry into effect the purposes of this Act. 

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may— 

1[(i) provide for determining under Section 4 the nearest ascertainable equivalent of the normal 

price; 

(ia) having regard to the normal practice of the wholesale trade, define or specify the kinds of trade 
discount to be excluded from the value under Section 4 including the circumstances in which and the 
conditions subject to which such discount is to be so excluded;] 

2[(ib)]  provide  for  the  assessment  and  collection  of  duties  of  excise,  the  authorities  by  whom 
functions under this Act are to be discharged, the issue of notices requiring payment, the manner in 
which the duties shall be payable, and the recovery of duty not paid; 

3[(ibb)  provide  for  charging  or  payment  of  interest  on  the  differential  amount  of  duty  which 

becomes payable or refundable upon finalisation of all or any class of provisional assessments;] 

4[(ic) provide for the remission of duty of excise leviable on any excisable goods, which due to any 
natural cause are found to be deficient in quantity, the limit or limits of percentage beyond which no 
such remission shall be allowed and the different limit or limits of percentage for different varieties of 
the same excisable goods or for different areas or for different seasons;] 

 5[(i-d)  provide for  the  amount  to  be  paid  6[for  compounding  and  the  manner  of compounding] 

under sub-section (2) of Section 9-A;] 

(ii)  prohibit  absolutely,  or  with  such  exceptions,  or  subject  to  such  conditions  as  the  Central 
Government thinks fit, the production or manufacture, or any process of the production or manufacture, 

1. Ins. by Act 22 of 1973, s. 3 (w.e.f. 1-9-1973). 
2. Clause (i) renumbered as clause (ib) by ibid, s. 3 (w.e.f. 1-9-1973). 
3. Ins. by Act 27 of 1999, s. 131(a) (w.e.f. 11-5-1999). 
4. Ins. by Act 25 of 1978, s. 25 (w.e.f. 1-7-1978). 
5. Ins. by Act 23 of 2004, s. 85. 
6. Subs. by Act 33 of 2009, s. 110, for “Compounding”. 

84 

 
                                                           
of excisable goods, or of any component parts or ingredients or containers thereof, except on land or 
premises approved for the purpose; 

(iii)  prohibit  absolutely,  or  with  such  exceptions,  or  subject  to  such  conditions  as  the  Central 
Government thinks fit, 1[* * *] the transit of excisable goods from any part of 2[India] to any other part 
thereof; 

(iv) regulate the removal of excisable goods from the place where produced, stored or manufactured 
or subjected to any process of production or manufacture and their transport to or from the premises of 
a 3[registered] person, or a bonded warehouse, or to a market; 

(v) regulate the production or manufacture, or any process of the production or manufacture, the 
possession, storage and sale of salt, and so far as such regulation is essential for the proper levy and 
collection of the duties imposed by this Act, or of any other excisable goods, or of any component parts 
or ingredients or containers thereof; 

(vi) provide for the employment of officers of the 4[Government] to supervise the carrying out of 

any rules made under this Act; 

(vii) require a manufacturer or the licensee of a warehouse to provide accommodation within the 
precincts of his factory or warehouse for officers employed to supervise the carrying out of regulations 
made under this Act and prescribe the scale of such accommodation; 

(viii) provide for the appointment, licensing, management and supervision of bonded warehouses 

and the procedure to be followed in entering goods into and clearing goods from such warehouses; 

(ix) provide for the distinguishing of goods which have been 5[manufactured after registration], of 
materials which have been imported under licence, and of goods on which duty has been paid, or which 
are exempt from duty under this Act; 

(x) impose on persons engaged in the production or manufacture, storage or sale (whether on their 
own account or as brokers or commission agents) of salt, and, so far as such imposition is essential for 
the proper levy and collection of the duties imposed by this Act, of any other excisable goods, the duty 
of  furnishing  information,  keeping  records  and  making  returns,  and  prescribe  the  nature  of  such 
information and the form of such records and returns, the particulars to be contained therein, and the 
manner in which they shall be verified; 

1. The words “the bringing of excisable goods into India from the State of Jammu and Kashmir, or” omitted by Act 41 of 1954,     

s. 2 and Sch (w.e.f. 8-10-1954). 

2. Subs. by Act 25 of 1950, s. 11 and Sch. IV, for “the States”. 
3. Subs. by Act 18 of 1992, s. 113(5)(i)(a), for “licensed” (w.e.f. 14-5-1992). 
4. Subs. by the A.O. 1950. 
5. Subs. by Act 18 of 1992, s. 113(5)(i)(b), for “manufactured under licence” (w.e.f. 14-5-1992). 

85 

 
                                                           
(xi) require that excisable goods shall not be sold or offered or kept for sale in 1[India] except in 
prescribed containers, bearing a banderol, stamp or label of such nature and affixed in such manner as 
may be prescribed; 

(xii) provide for the issue of 2[registration certificates] and transport permits and the fees, if any, to 

be charged therefor: 

Provided that the fees for the licensing of the manufacture and refining of salt and saltpetre shall 

not exceed, in the case of each such licence, the following amounts, namely:— 

Rs. 

Licence  to  manufacture  and  refine  saltpetre  and  to  separate  and  purify  salt  in  the  process  of  such 
manufacture and refining 

50 

Licence to manufacture saltpetre 

Licence to manufacture sulphate of soda (Kharinun) by solar heat in evaporating pans 

Licence to manufacture sulphate of soda (Kharinun) by artificial heat 

Licence to manufacture other saline substances 

2 

10 

2 

2; 

 (xiii) provide for the detention of goods, plant, machinery or material, for the purpose of exacting the 

duty, the procedure in connection with the confiscation, otherwise than under Section 10 or Section 28, of 

goods in respect of which breaches of that Act or rules have been committed, and the disposal of goods so 

detained or confiscated; 

3[(xiii-a) provide for withdrawal of facilities or imposition of restrictions (including restrictions on 
utilisation of CENVAT credit) on manufacturer or exporter or suspension of registration of dealer, for 
dealing with evasion of duty or misuse of CENVAT credit;] 

(xiv) authorise and regulate the inspection of factories and provide for the taking of samples, and 
for the making of tests, of any substance produced therein, and for the inspection or search of any place 
or conveyance used for the production, storage, sale or transport of salt, and so far as such inspection 
or search is essential for the proper levy and collection of the duties imposed by this Act, of any other 
excisable goods; 

(xv) authorise and regulate the composition of offences against, or liabilities incurred under this 

Act or the rules made thereunder; 

1. Subs. by Act 25 of 1950, s. 11 and Sch. IV, for “the States”. 
2. Subs. by Act 18 of 1992, s. 113(5)(i)(c), for “licences” (w.e.f. 14-5-1992). 
3. Ins. by Act 14 of 2010, s. 68. 

86 

 
 
 
                                                           
(xvi) provide for the grant of a rebate of the duty paid on goods which are exported out of India or 

shipped for consumption on a voyage to any port outside India 1[including interest thereon]; 

2[* * *] 

3[(xvi-a) provide for the credit of duty paid or deemed to have been paid on the goods used in, or 

in relation to, the manufacture of excisable goods;] 

4[(xvi-aa) provide for credit of service tax leviable under Chapter V of the Finance Act, 1994 (32 
of 1994), paid or payable on taxable services used in, or in relation to, the manufacture of excisable 
goods;] 

5[(xvi-b) provide for the giving of credit of sums of money with respect to raw materials used in the 

manufacture of excisable goods;] 

6[(xvi-c) provide for charging and payment of interest, as the case may be, on credit of duty paid or 
deemed to have been paid on the goods used in, or in relation to, the manufacture of excisable goods 
where such credit is varied subsequently;] 

(xvii) exempt any goods from the whole or any part of the duty imposed by this Act; 

7[(xvii-a)  provide  incentives  for  increased  production  or  manufacture  of  any  goods  by  way  of 

remission of, or any concession with respect to, duty payable under this Act;] 

(xviii) define an area no point in which shall be more than one hundred yards from the nearest point 
of any place in which salt is stored or sold by or on behalf of the Central Government, or of any factory 
in which saltpetre is manufactured or refined, and regulate the possession, storage and sale of salt within 
such area; 

(xix) define an area and any other place in which salt is manufactured, and regulate the possession, 

storage and sale of salt within such area; 

(xx) authorise the 8[Central Board of Excise and Customs constituted under the Central Boards of 
Revenue Act, 1963 (54 of 1963)] or  9[Chief Commissioners of Central Excise or Commissioners of 
Central  Excise]  appointed  for  the  purposes  of  this  Act  to  provide,  by  written  instructions,  for 
supplemental matters arising out of any rule made by the Central Government under this section; 

1. Ins. by Act 22 of 1995, s. 78(a)(i). 
2. Proviso omitted by Act 49 of 1957, s. 2. 
3. Ins. by Act 23 of 1986, s. 51 (w.e.f. 13-5-1986). 
4. Ins. by Act 23 of 2004, s. 85. 
5. Ins. by Act 11 of 1987, s. 94. 
6. Ins. by Act 22 of 1995, s. 78. 
7. Ins. by Act 14 of 1982, s. 48. 
8. Subs. by Act 54 of 1963, s. 5, for central Board of Revenue” (w.e.f. 1-1-1964). 
9. Subs, by Act 25 of 2014, s. 95, for “Commissioners of Central Excise” (w.e.f. 6-8-2004). 

87 

 
                                                           
1[(xxi) provide for the publication, subject to such conditions as may be specified therein, of names 
and other particulars of persons who have been found guilty of contravention of any of the provisions 
of this Act or of any rule made thereunder;] 

2[(xxii) provide for the charging of fees for the examination of excisable goods intended for export 
out of India and for rendering any other service by a Central Excise Officer under this Act or the rules 
made thereunder;] 

3[(xxiii) specify the 4[form and manner] in which application for refund shall be made under Section 

11-B; 

 (xxiv) provide for the manner in which money is to be credited to the Fund; 

(xxv) provide for the manner in which the Fund shall be utilised for the welfare of the consumers; 

(xxvi) specify the form in which the account and records relating to the Fund shall be maintained;] 

5 [(xxvii) specify the persons who shall get themselves registered under Section 6 and the manner 

of their registration;] 

6[(xxviii) provide for the lapsing of credit of duty lying unutilised with the manufacturer of specified 
excisable goods on an appointed date and also for not allowing such credit to be utilised for payment 
of any kind of duty on any excisable goods on and from such date.] 

7[(2A) The power to make rules conferred by clause (xvi) of sub-section (2) shall include the power to 

give retrospective effect to rebate of duties on inputs used in the export goods from a date not earlier than 

the changes in the rates of duty on such inputs.] 

(3) In making rules under this section, the Central Government may provide that any person committing 

a  breach  of  any  rule  shall,  where  no  other  penalty  is  provided  by  this  Act,  be  liable  to  a  penalty  not 

exceeding 8[five thousand rupees]. 

9[(4) Notwithstanding anything contained in sub-section (3), and without prejudice to the provisions of 
Section 9, in making rules under this section, the Central Government may provide that if any manufacturer, 
producer or licensee of a warehouse— 

(a) removes any excisable goods in contravention of the provisions of any such rule, or 

(b) does not account for all such goods manufactured, produced or stored by him, or 

1. Ins. by Act 36 of 1973, s. 24. 
2. Ins. by Act 79 of 1985, s. 6 (w.e.f. 27-12-1985). 
3. Ins. by Act 40 of 1991, s. 8 (w.e.f. 20-9-1991). 
4. Subs. by Act 22 of 1995, s. 78, for “form”. 
5. Ins. by Act 18 of 1992, s. 113(5)(i)(d) (w.e.f. 4-5-1992). 
6. Ins. by Act 27 of 1999, s. 131 (w.r.e.f. 16-3-1995). 
7. Ins. by Act 22 of 1995, s. 78 (w.e.f. 26-5-1999). 
8. Subs. by Act 10 of 2000, s. 108, for certain words (w.e.f. 12-5-2000). 
9. Ins. by Act 19 of 1968, s. 38(i) (w.e.f. 11-5-1968). 

88 

 
                                                           
(c) engages in the manufacture, production or storage of such goods without having applied for 

the 1[registration as] required under Section 6, or 

2[(d) contravenes the provisions of any such rule with intent to evade payment of duty, 

then, all such goods shall be liable to confiscation and the manufacturer, producer or licensee shall 
be  liable  to  a  penalty  not  exceeding  the  duty  leviable  on  such  goods  or 3[five  thousand  rupees], 
whichever is greater.] 

4[(5) Notwithstanding anything contained in sub-section (3), the Central Government may make rules 

to provide for the imposition upon any person who acquires possession of, or is in any way concerned in 

transporting, removing, depositing, keeping, concealing, selling or purchasing, or in any other manner deals 

with, any excisable goods which he knows or has reason to believe are liable to confiscation under this Act 

or the rules made thereunder, a penalty 5[not exceeding the duty leviable on such goods or 6[five thousand 

rupees], whichever is greater].] 

7[37A. Delegation of powers.—The Central Government may, by notification in the Official Gazette, 

direct that subject to such conditions, if any, as may be specified in the notification— 

(a) any power exercisable by the Board under this Act may be exercisable also by 8[a 9[Principal 
Chief  Commissioner  of  Central  Excise  or  Chief  Commissioner  of  Central  Excise] or  a 10[Principal 
Commissioner of Central Excise or Commissioner of Central Excise]] empowered in this behalf by the 
Central Government; 

(b) any power exercisable by a 10[Principal Commissioner of Central Excise or Commissioner of 
Central  Excise]  under  this  Act  may  be  exercisable  also  by  a 11[Joint] 10[Principal  Commissioner  of 
Central  Excise  or  Commissioner  of  Central  Excise]  or  an  Assistant 10[Principal  Commissioner  of 
Central Excise or Commissioner of Central Excise] or Deputy  10[Principal Commissioner of Central 
Excise or Commissioner of Central Excise] empowered in this behalf by the Central Government; 

(c)  any  power  exercisable  by  a 11[Joint]  10[Principal  Commissioner  of  Central  Excise  or 
Commissioner of Central Excise] under this Act may be exercisable also by an Assistant 10[Principal 
Commissioner  of  Central  Excise  or  Commissioner  of  Central  Excise] or  Deputy 10[Principal 
Commissioner of Central Excise or Commissioner of Central Excise] empowered in this behalf by the 
Central Government; and 

1. Subs. by Act 18 of 1992, s. 113(5)(ii), for “licence” (w.e.f. 14-5-1992). 
2. Subs. by Act 10 of 2000, s. 108, for (d) in sub-section (4). 
3. Subs. by Act 20 of 2015, s. 103, for “two thousand rupees”. 
4. Ins. by Act 36 of 1973, s. 24 (w.e.f. 1-9-1973). 
5.  Subs. by Act 10 of 2000, s. 108, for certain words, (w.e.f. 12-5-2000). 
6. Subs. by Act 20 of 2015, s. 103, for “two thousand rupees”. 
7. Ins. by Act 25 of 1978, s. 26 (w.e.f. 1-7-1978). 
8. Subs. by Act 29 of 1988, s. 14, for “a Collector of Central Excise” (w.e.f. 16-8-1988). 
9. Subs. by Act 25 of 2014, s. 95, for “Chief Commissioner of Central Excise” (w.e.f. 6-8-2014). 
10. Subs. by ibid, s. 95, for “Commissioner of Central Excise”. 
11. Subs. by Act 27 of 1999, s. 119, for “Deputy Commissioner of Central Excise” (w.e.f. 11-5-1999). 

89 

 
                                                           
(d)  any  power  exercisable  by  an  Assistant 1[Principal  Commissioner  of  Central  Excise  or 
Commissioner  of  Central  Excise]  or  Deputy 1[Principal  Commissioner  of  Central  Excise  or 
Commissioner of Central Excise] under this Act may be exercisable also by a gazetted officer of Central 
Excise empowered in this behalf by the Board.] 

2[37B.  Instructions  to  Central  Excise  Officers.—The  Central  Board  of  Excise  and  Customs 

constituted under the Central Boards of Revenue Act, 1963 (54 of 1963), may, if it considers it necessary 

or expedient so to do for the purpose of uniformity in the classification of excisable goods or with respect 

to levy of duties of excise on 3[such goods or for the implementation of any other provision of this Act], 

issue such orders, instructions and directions to the Central Excise Officers as it may deem fit, and such 

officers and all other persons employed in the execution of this Act shall observe and follow such orders, 

instructions and directions of the said Board: 

Provided that no such orders, instructions or directions shall be issued— 

(a) so as to require any Central Excise Officer to make a particular assessment or to dispose of a 

particular case in a particular manner; or 

(b)  so  as  to  interfere  with  the  discretion  of  the 1[Principal  Commissioner  of  Central  Excise  or 

Commissioner of Central Excise] (Appeals) in the exercise of his appellate functions. 

1[37C.  Service  of  decisions,  orders,  summons,  etc.—(1)  Any  decision  or  order  passed  or  any 

summons or notices issued under this Act or the rules made thereunder, shall be served,— 

(a)  by  tendering  the  decision,  order,  summons  or  notice,  or  sending  it  by  registered  post  with 
acknowledgment due 4[or by speed post with proof of delivery or by courier approved by the Central 
Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963)], 
to the person for whom it is intended or his authorised agent, if any; 

(b) if the decision, order, summons or notice cannot be served in the manner provided in clause (a), 
by  affixing  a  copy  thereof  to  some  conspicuous  part  of  the  factory  or  warehouse  or  other  place  of 
business or usual place of residence of the person for whom such decision, order, summons or notice, 
as the case may be, is intended; 

(c) if the decision, order, summons or notice cannot be served in the manner provided in clauses 
(a) and (b), by affixing a copy thereof on the notice-board of the officer or authority who or which 
passed such decision or order or issued such summons or notice.  

1. Subs. by Act 25 of 2014, s. 95, for “Commissioner of Central Excise”.  
2. Sections 37B & 37C ins. by Act 79 of 1985, s. 7 (w.e.f. 27-12-1985). 
3. Subs. by Act 28 of 2016, s. 144, for “such goods” (w.e.f. 14-5-2016). 
4. Ins. by Act 17 of 2013, s. 100(i). 

90 

 
 
                                                           
(2) Every decision or order passed or any summons or notice issued under this Act or the rules made 

thereunder, shall be deemed to have been served on the date on which the decision, order, summons or 

notice is tendered or delivered by post 1[or courier referred to in sub-section (1)] or a copy thereof is affixed 

in the manner provided in sub-section (1).] 

2[37D.  Rounding  off  of  duty,  etc.—The  amount  of  duty,  interest,  penalty,  fine  or  any  other  sum 

payable, and the amount of refund or any other sum due, under the provisions of this Act shall be rounded 

off to the nearest rupee and, for this purpose, where such amount contains a part of a rupee consisting of 

paise then, if such part is fifty paise or more, it shall be increased to one rupee and if such part is less than 

fifty paise it shall be ignored.] 

3[37E.  Publication  of  information  respecting  persons  in  certain  cases.—(1)  If  the  Central 

Government is of opinion that it is necessary or expedient in the public interest to publish the names of any 

person and any other particulars relating to any proceedings or prosecutions under this Act in respect  of 

such person, it may cause to be published such names and particulars in such manner as if thinks fit. 

(2) No publication under this section shall be made in relation to any penalty imposed under this Act 

until the time for presenting an appeal to the Commissioner (Appeals) under Section 35 of the Appellate 

Tribunal under Section 35-B, as the case may be, has expired without an appeal having been presented or 

the appeal, if presented, has been disposed of. 

Explanation.—In the case of a firm, company or other association of persons, the names of the 
partners of the firm, directors, managing agents, secretaries and treasurers or managers of the company, 
or the members of the association, as the case may be, may also be published if, in the opinion of the 
Central Government, circumstances of the case justify it.] 

4[38. Publication of rules and notifications and laying of rules before Parliament.—(1) All rules 

made and notifications issued under this Act shall be published in the Official Gazette. 

5[(2)  Every  rule  made  under  this  Act,  every  notification  issued  under 6[Section  3A,   7[Section  3C] 
Section 4A,] sub-section (1) of Section 5A, 8[Section 5B] and Section 11C and every order made under 
sub-section  (2)  of  Section  5A,  other  than  an  order  relating  to  goods  of  strategic,  secret,  individual  or 
personal nature, shall be laid, as soon as may be after it is made or issued, before each House of Parliament, 
while it is in session, for a total period of thirty days which may be comprised in one session, or in two or 
more successive sessions, and if, before the expiry of the session immediately following the session or the 
successive sessions aforesaid, both Houses agree in making any modification in the rule or notification or 
order, or both Houses agree that the rule should not be made or notification or order should not be issued 
or made, the rule or notification or order shall thereafter have effect only in such modified form or be of no 

1. Ins. by Act 17 of 2013, s. 100(ii). 
2. Ins. by Act 12 of 1990, s. 65 (w.e.f. 31-5-1990). 
3. Ins. by Act. 29 of 2006, s. 38 (w.e.f. 1-9-1973). 
4. Subs. by Act 22 of 1973, s. 4, for section 38. 
5. Subs. by Act 22 of 1995, s. 79, for sub-section (2) (w.e.f. 26-5-1995). 
6. Ins. by Act 26 of 1997, s. 84 (w.e.f. 14-5-1997). 
7. Ins. by Act 18 of 2017, s. 9. 
8. Ins. by Act 8 of 2011, s. 70. 

91 

 
                                                           
effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice 
to the validity of anything previously done under that rule or notification or order.]] 

1[38A. Effect of amendments, etc. of rules, notifications or orders.—Where any rule, notification or 
order  made  or  issued  under  this  Act  or  any  notification  or  order  issued  under  such  rule,  is  amended, 
repealed,  superseded  or  rescinded,  then,  unless  a  different  intention  appears,  such  amendment,  repeal, 
supersession or rescinding shall not— 

(a) revive anything not in force or existing at the time at which the amendment, repeal, supersession 

or rescinding takes effect; or 

(b) affect the previous operation of any rule, notification or order so amended, repealed, superseded 

or rescinded or anything duly done or suffered thereunder; or 

(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any rule, 

notification or order so amended, repealed, superseded or rescinded; or 

(d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed under 

or in violation of any rule, notification or order so amended, repealed, superseded or rescinded; or 

(e)  affect  any  investigation,  legal  proceeding  or  remedy  in  respect  of  any  such  right,  privilege, 

obligation, liability, penalty, forfeiture or punishment as aforesaid, 

and any such investigation, legal proceeding or remedy may be instituted, continued or enforced 
and any such penalty, forfeiture or punishment may be imposed as if the rule, notification or order, as 
the case may be, had not been amended, repealed, superseded or rescinded.] 

2[38B. Savings of references to Chapter, Heading, Sub-heading and tariff item in Central Excise 

Tariff  Act,  1985.—Notwithstanding  the  repeal  of  the  Central  Excise  Tariff  Act,  1985  (5  of  1986)  by                  

sub-section  (1)  of  Section  174  of  the  Central  Goods  and  Services  Tax  Act,  2017,  any  reference  to  the 

Chapter, heading, sub-heading or tariff item, as the case may be, in the First Schedule to the said Act or in 

any  rules  or  regulations  made  thereunder,  or  in  any  notification,  circular,  order  or  instruction  issued 

thereunder, shall mean a reference to the Chapter, heading, sub-heading or tariff item, as the case may be, 

in the Fourth Schedule.] 

39. Repeal of enactments.—[Rep. by the Repealing and Amending Act, 1947 (2 of 1948), S. 2 and 

Sch.] 

3[40. Protection of action taken under the Act.—(1) No suit, prosecution or other legal proceeding 

shall lie against the Central Government or any officer of the Central Government or a State Government 

for anything which is done, or intended to be done, in good faith, in pursuance of this Act or any rule made 

thereunder. 

1. Ins. by Act 14 of 2001, s. 131 (w.r.e.f. 28-2-1944). 
2. Ins. by Act 18 of 2017, s. 10. 
3. Subs. by Act 22 of 1973, s. 5, for section 40 (w.e.f. 1-9-1973). 

92 

 
                                                           
(2) No proceeding, other than a suit, shall be commenced against the Central Government or any officer 

of the Central Government or a State Government for anything done or purported to have been done in 

pursuance of this Act or any rule made thereunder, without giving the Central Government or such officer 

a  month’s  previous  notice  in  writing  of  the  intended  proceeding  and  of  the  cause  thereof  or  after  the 

expiration of three months from the accrual of such cause.] 

93 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
[THE FIRST SCHEDULE:] Omitted by the Central Excise Tariff Act, 1985 (Act 5 of 1986), s. 4 (w.e.f. 

28-2-1986). 

94 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1[THE SECOND SCHEDULE 

[See Section 8] 

TOBACCO 

2[THE THIRD SCHEDULE 

[See Section 2(f)(iii)] 

NOTES 

1.  In  this  Schedule,  “heading”,  “sub-heading”  and  “tariff  item”  mean  respectively,  a  heading,                

sub-heading and tariff item in the Fourth Schedule. 

2. The rules for the interpretation, the Section, Chapter Notes and the General Explanatory Notes of the 

Fourth Schedule shall apply to the interpretation of this Schedule. 

Sl. 
No. 

Heading, Sub-heading or Tariff 
Item 

Description of goods 

1.  2402 20 10 to 2402 20 90 

All Goods 

2.  2403 99 10, 2403 99 20, 2403 99 30 Chewing 

tobacco  and  preparations  containing  chewing 

tabacco 

3.  2403 99 90 

Pan masala containing tobacco.] 

1. Subs. by Act 18 of 1956, s. 36, for THE SECOND SCHEDULE (w.e.f. 27-4-1956). 
2. Subs. by Act 18 of 2017, s. 11 and Schedule I, for THE THIRD SCHEDULE. 

95 

 
 
  
 
 
 
 
 
 
 
                                                           
1[THE FOURTH SCHEDULE 

[See Section 2(d) and 2(f)(ii)] 

General rules for the interpretation of this Schedule 

Classification of goods in this Schedule shall be governed by the following principles: 

1. The titles of Sections, Chapters and Sub-chapters are provided for ease of reference only; for legal 

purposes, classification shall be determined according to the terms of the headings and any relative Sections 

or Chapter Notes and, provided such headings or notes do not otherwise require, according to the following 

provisions. 

2. Any reference in a heading— 

(a)  to  an  article  shall  be  taken  to  include  a  reference  to  that  article  incomplete  or  unfinished, 
provided  that,  as  presented,  the  incomplete  or  unfinished  article  has  the  essential  character  of  the 
complete  or finished  article.  It  shall  also  be  taken to  include  a reference  to  that  article  complete or 
finished (or falling to be classified as complete or finished by virtue of this rule), presented unassembled 
or disassembled; 

(b) to a material or substance shall be taken to include a reference to mixtures or combinations of 
that material or substance with other materials or substances. Any reference to goods of a given material 
or substance shall be taken to include a reference to goods consisting wholly or partly of such material 
or substance. The classification of goods consisting of more than one material or substance shall be 
according to the principles of Rule 3. 

3.  When  by  application  of  clause  (b)  of  Rule  2  or  for  any  other  reason,  goods  are,  prima  facie, 

classifiable under two or more headings, classification shall be effected as follows— 

(a)  the  heading  which  provides  the  most  specific  description  shall  be  preferred  to  headings 
providing a more general description. However, when two or more headings each refer to part only of 
the materials or substances contained in mixed or composite goods or to part only of the items in a set 
put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, 
even if one of them gives a more complete or precise description of the goods; 

(b) mixtures, composite goods consisting of different materials or made up of different components, 
and goods put up in sets for retail sale, which cannot be classified by reference to clause (a), shall be 
classified as if they consisted of the material or component which gives them their essential character, 
insofar as this criterion is applicable; 

1. Ins. by Act 18 of 2017, s. 12 and Schedule II. 

96 

 
 
                                                           
(c) when goods cannot be classified by reference to clause (a) or clause (b), they shall be classified 
under the heading which occurs last in numerical order among those which equally merit consideration. 

4. Goods which cannot be classified in accordance with the above rules shall be classified under the 

heading appropriate to the goods to which they are most akin. 

5. For legal purposes, the classification of goods in the sub-headings of a heading shall be determined 

according to the terms of those sub-headings and any related sub-heading notes and, mutatis mutandis, to 

the above rules, on the understanding that only sub-headings at the same level are comparable. For the 

purposes of this rule, the relative chapter notes also apply, unless the context otherwise requires. 

General Explanatory Notes 

1. Where in column (2) of this Schedule, the description of an article or group of articles under a heading 

is preceded by “-”, the said article or group of articles shall be taken to be a sub-classification of the article 

or group of articles covered by the said heading. Where, however, the description of an article or group of 

articles is preceded by “--”, the said article or group of articles shall be taken to be a sub-classification of 

the  immediately  preceding  description  of  the  article  or  group  of  articles  which  has  “-”.  Where  the 

description of an article or group of articles is preceded by “---” or “----”, the said article or group of articles 

shall be taken to be a sub-classification of the immediately preceding description of the article or group of 

articles which has “-” or “--”. 

2. The abbreviation “%” in column (4) of this Schedule, in relation to the rate of duty, indicates that the 

duty on the goods to which the entry relates shall be charged on the basis of the value of the goods fixed, 

defined or deemed to be, as the case may be, under or in sub-section (2), read with sub-section (3) of Section 

3 or Section 4 or Section 4-A of the Central Excise Act, 1944 (1 of 1944), the duty being equal to such 

percentage of the value as is indicated in that column. 

Additional Notes 

In this Schedule,— 

(1) The expression,— 

(a) “heading”, in respect of goods, means a description in list of tariff provisions accompanied 
by a four digit number and includes all sub-headings of tariff items the first four digits of which 
correspond to that number; 

(b)  “sub-heading”,  in  respect  of  goods,  means  a  description  in  the  list  of  tariff  provisions 
accompanied  by  a  six  digit  number  and  includes  all  tariff  items  the  first  six  digits  of  which 
correspond to that number; 

97 

 
(c) “tariff item” means a description of goods in the list of tariff provisions accompanying either 
eight-digit number and the rate of the duty of excise, or eight digit number with blank in the column 
of the rate of duty; 

(2) The list of tariff provisions is divided into sections, chapters and sub-chapters; 

(3)  In  column  (3),  the standard  unit of quantity  is  specified for  each tariff item  to  facilitate the 

collection, comparison and analysis of trade statistics; 

(4) “…..” against any goods denotes that Central Excise Duty under this Schedule is not leviable 

on such goods. 

Abbreviations 

1. Kg. 

2. Tu 

List of Abbreviations used 

For 

Kilogram 

Thousand in number 

Section IV 

TOBACCO AND MANUFACTURED TOBACCO SUBSTITUTES 

NOTE 

In this Section, the expression “unit container” means a container, whether large or small (for example, 

tin, can, box, jar, bottle, bag or carton, drum, barrel or canister) designed to hold a predetermined quantity 

or number. 

CHAPTER 24 

TOBACCO AND MANUFACTURED TOBACCO SUBSTITUTES 

NOTES 

1. In this Chapter, “brand name” means a brand name, whether registered or not, that is to say, a name 

or a mark, such as a symbol, monogram, label, signature invented words or any writing which is used in 

relation to a product, for the purpose of indicating, or so as to indicate, a connection in the course of trade 

between the product and some person using such name or mark with or without any indication of the identity 

of that person. 

98 

 
  
2. In relation to products of Heading 2401 or 2402 or 2403, labelling or relabelling of containers or 

repacking  from  bulk  packs  to  retail  packs  or  the  adoption  of  any  other  treatment  to  render  the  product 

marketable to the consumer, shall amount to “manufacture”. 

3. In this Chapter, “Pan masala containing tobacco”, commonly known as “gutkha” or by any other 

name, included in Tariff Item 2403 99 90, means any preparation containing betelnuts and tobacco and any 

one or more of the following ingredients, namely— 

(i) lime; and 

(ii) kattha (catechu), 

whether or not containing any other ingredients, such as cardamom, copra and menthol. 

SUB-HEADING NOTE 

For the purposes of sub-heading 2403 11, the expression “water pipe tobacco” means tobacco intended 

for  smoking  in  a  water  pipe  and  which  consists  of  a  mixture  of  tobacco  and  glycerol,  whether  or  not 

containing aromatic oils and extracts, molasses or sugar, and whether or not flavoured with fruit. However, 

tobacco-free products intended for smoking in a water pipe are excluded from this sub-heading. 

For the purposes of this Chapter: 

SUPPLEMENTRY NOTES 

(1) “tobacco” means any form of tobacco, whether cured or uncured and whether manufactured or 
not, and includes the leaf, stalks and stems of the tobacco plant, but does not include any part of a 
tobacco plant while still attached to the earth. 

(2) “cut-tobacco” means the prepared or processed cut-to-size tobacco which is generally blended 

or moisturised to a desired extent for use in the manufacture of machine rolled cigarettes. 

(3) “smoking mixtures for pipes and cigarettes” of sub-heading 2403 10 does not cover “ Gudaku”. 

Tariff 
item 

(1) 

Description of goods 

Unit  Rate of Duty 

(2) 

(3) 

(4) 

2401 

Unmanufactured Tobacco; Tobacco Refuse 

2401 10  - Tobacco, not stemmed or stripped: 

Flue cured virginia tobacco 

2401  10 
-
-
10 
- 

99 

Kg. 

64% 

 
 
 
 
 
Description of goods 

Unit  Rate of Duty 

Tariff 
item 

(1) 

(2) 

Sun cured country (natu) tobacco 

2401  10 
-
-
20 
- 

Sun cured virginia tobacco 

2401  10 
-
-
30 
- 

Burley tobacco 

2401  10 
-
-
40 
- 

Tobacco for manufacture of biris, not stemmed 

2401  10 
-
-
50 
- 

Tobacco for manufacture of chewing tobacco 

2401  10 
-
-
60 
- 

Tobacco for manufacture of cigar and cheroot 

2401  10 
-
-
70 
- 

Tobacco for manufacture of hookah tobacco 

2401  10 
-
-
80 
- 

Other 

2401  10 
-
-
90 
- 

2401 20  - Tobacco, partly or wholly stemmed or stripped: 

Flue cured virginia tobacco 

2401  20 
-
-
10 
- 

Sun cured country (natu) tobacco 

2401  20 
-
-
20 
- 

100 

(3) 

Kg. 

(4) 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

 
 
 
Tariff 
item 

(1) 

(2) 

Description of goods 

Unit  Rate of Duty 

Sun cured virginia tobacco 

2401  20 
-
-
30 
- 

Burley tobacco 

2401  20 
-
-
40 
- 

Tobacco for manufacture of biris 

2401  20 
-
-
50 
- 

Tobacco for manufacture of chewing tobacco 

2401  20 
-
-
60 
- 

Tobacco for manufacture of cigar and cheroot 

2401  20 
-
-
70 
- 

Tobacco for manufacture of hookah tobacco 

2401  20 
-
-
80 
- 

Other 

2401  20 
-
-
90 
- 

2401  30 
00 

- Tobacco refuse 

2402 

Cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco 
substitutes 

2402 10  - Cigars, cheroots and cigarillos, containing tobacco: 

Cigar and cheroots 

-
2402  10 
-
10 
- 

101 

(3) 

Kg. 

(4) 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

64% 

Kg. 

50% 

Tu 

12.5% or 

Rs 4006 per 
thousand, 

 
 
 
 
 
 
 
   
 
whichever is 
higher 

Tu 

12.5% or 

Rs 4006 per 
thousand, 
whichever is 
higher 

Tu 

Rs 1280 per 
thousand 

Description of goods 

Unit  Rate of Duty 

(2) 

(3) 

(4) 

Tariff 
item 

(1) 

Cigarillos 

2402  10 
-
-
20 
- 

2402 20  - Cigarettes, containing tobacco: 

Other than filter cigarettes, of length not exceeding 65 millimetres 

-
2402  20 
-
10 
- 

Other than filter cigarettes, of length exceeding 65 millimetres but not 
-
2402  20 
exceeding 70 millimetres 
-
20 
- 

Tu 

Rs 2335 per 
thousand 

Filter cigarettes of length (including the length of the filter, the length 
2402  20 
-
of filter being 11 millimetres or its actual length, whichever is more) 
-
30 
not exceeding 65 millimetres 
- 

Tu 

Rs 1280 per 
thousand 

Filter cigarettes of length (including the length of the filter, the length 
2402  20 
-
of filter being 11 millimetres or its actual length, whichever is more) 
-
40 
exceeding 65 millimetres but not exceeding 70 millimetres 
- 

Tu 

Rs 1740 per 
thousand 

Filter cigarettes of length (including the length of the filter, the length 
2402  20 
-
of filter being 11 millimetres or its actual length, whichever is more) 
-
50 
exceeding 70 millimetres but not exceeding 75 millimetres 
- 

Tu 

Rs 2335 per 
thousand 

Other 

2402  20 
-
-
90 
- 

2402 90  - Other: 

Cigarettes of tobacco substitutes 

-
2402  90 
-
10 
- 

102 

Tu 

Rs 3375 per 
thousand 

Tu 

Rs 3375 per 
thousand 

 
 
   
 
 
 
 
 
Tariff 
item 

(1) 

Description of goods 

Unit  Rate of Duty 

(2) 

(3) 

(4) 

Cigarillos of tobacco substitutes 

2402  90 
-
-
20 
- 

Other 

2402  90 
-
-
90 
- 

2403  Other  manufactured 

tobacco 
substitutes;  “Homogenised”  or  “Reconstituted”  tobacco;  Tobacco 
extracts and essences 

tobacco  and  manufactured 

- Smoking tobacco, whether or not containing tobacco substitute in any 
proportion; 

2403 11  -
Water pipe tobacco specified in Sub-heading Note to this Chapter: 
- 

Hukkah or gudaku tobacco 

2403  11 
-
-
10 
- 

Other 

2403  11 
-
-
90 
- 

2403 19  -
Other 
- 

Smoking mixtures for pipes and cigarettes 

2403  19 
-
-
10 
- 

Biris: 

-
-
- 

Tu  12.5% or Rs 4006 

per thousand 
whichever is 
higher 

Tu  12.5% or Rs 4006 

per thousand 
whichever is 
higher 

Kg. 

60% 

Kg. 

60% 

Kg. 

360% 

Other than paper rolled biris, manufactured without the aid of machine  Tu 

2403  19 
-
-
21 
-
- 

Rs 12 per 
thousand 

103 

 
 
 
 
 
 
 
 
 
 
 
 
 
Description of goods 

Unit  Rate of Duty 

(2) 

(3) 

Tu 

(4) 

Rs 80 per 
thousand 

Kg. 

40% 

Tariff 
item 

(1) 

Other 

2403  19 
-
-
29 
-
- 

Other 

2403  19 
-
-
90 
- 

- Other: 

2403  91 
-
“Homogenised” or “reconstituted” tobacco 
- 
00 

Kg. 

60% 

2403 99  -
Other: 
- 

Chewing tobacco 

-
2403  99 
-
10 
- 

Preparations containing chewing tobacco 

-
2403  99 
-
20 
- 

Jarda scented tobacco 

-
2403  99 
-
30 
- 

Snuff 

-
2403  99 
-
40 
- 

Preparations containing snuff 

-
2403  99 
-
50 
- 

Tobacco extracts and essence 

2403  99 
-
-
60 
- 

104 

Kg. 

81% 

Kg. 

60% 

Kg. 

81% 

Kg. 

60% 

Kg. 

60% 

Kg. 

60% 

 
 
 
 
 
 
Tariff 
item 

(1) 

Cuttobacco 

2403  99 
-
-
70 
- 

Other 

2403  99 
-
-
90 
- 

Description of goods 

Unit  Rate of Duty 

(2) 

(3) 

(4) 

Kg.  Rs 70 per Kg. 

Kg. 

81% 

Section V 

MINERAL PRODUCTS 

Chapter 27 

MINERAL FUELS, MINERAL OILS AND PRODUCTS OF THEIR DISTILLATION; BITUMINOUS 

SUBSTANCES; MINERAL WAXES 

Notes 

1. References in Heading 2710 to “petroleum oils and oils obtained from bituminous minerals” include 

not only petroleum oils and oils obtained from bituminous minerals, but also similar oils, as well as those 

consisting mainly of mixed unsaturated hydrocarbons, obtained by any process, provided that the weight 

of the non-aromatic constituents exceeds that of the aromatic constituents. 

However, the references do not include liquid synthetic polyolefins of which less than 60% by volume 

distils at 300°C, after conversion to 1013 millibars when a reduced pressure distillation method is used. 

2. In relation to lubricating oils and lubricating preparations of Heading 2710, labelling or relabelling 

of containers or repacking from bulk packs to retail packs or the adoption of any other treatment to render 

the product marketable to the consumer, shall amount to “manufacture”. 

3. In relation to natural gas falling under Heading 2711, the process of compression of natural gas (even 

if it does not involve liquefaction), for the purpose of marketing it as Compressed Natural Gas (CNG), for 

use as a fuel or for any other purpose, shall amount to “manufacture”. 

Sub-Heading Note 

For the purposes of sub-heading 2710 12, “light oils and preparations” are those of which 90% or more 

by volume (including losses) distil at 210°C (ASTM D 86 method). 

105 

 
  
Supplementary Notes 

In this Chapter, the following expressions have the meanings hereby assigned to them— 

(1) “motor spirit” means any hydrocarbon oil (excluding crude mineral oil) which has its flash point 
below 25°C and which either by itself or in admixture with any other substance, is suitable for use as 
fuel in spark ignition engines. “Special boiling point spirits (Tariff Items 2710 12 11, 2710 12 12 and 
2710  12  13)”  means  light  oils,  as  defined  in  sub-heading  Note  4,  not  containing  any  anti-knock 
preparations, and with a difference of not more than 60°C between the temperatures at which 5% and 
90% by volume (including losses) distil; 

(2)  “natural  gasoline  liquid  (NGL)”  is  a  low-boiling  liquid  petroleum  product  extracted  from 

Natural Gas; 

(3) “aviation turbine fuel (ATF)” means any hydrocarbon oil conforming to the Indian Standards 

Specification of Bureau of Indian Standards IS : 1571 : 1992 : 2000; 

(4)  “high  speed  diesel  (HSD)”  means  any  hydrocarbon  oil  conforming  to  the  Indian  Standards 

Specification of Bureau of Indian Standards IS : 1460 : 2000; 

(5) for the purposes of these additional notes, the tests prescribed have the meaning hereby assigned 

to them— 

(a) “Flash Point” shall be determined in accordance with the test prescribed in this behalf in 

the rules made under the Petroleum Act, 1934 (30 of 1934); 

(b) “Smoke Point” shall be determined in the apparatus known as the Smoke Point Lamp in the 
manner indicated in the Indian Standards Institution Specification IS : 1448 (p. 31)-1967 for the 
time being in force; 

(c) “Final Boiling Point” shall be determined in the manner indicated in the Indian Standards 

Institution Specification IS : 1448 (p. 18)-1967 for the time being in force; 

(d)  “Carbon  Residue”  shall  be  determined  in  the  apparatus  known  as  Ramsbottom  Carbon 
Residue Apparatus in the manner indicated in the Indian Standards Institution Specification IS : 
1448 (p. 8)-1967 for the time being in force; 

(e) “Colour Comparison Test” shall be done in the following manner, namely— 

(i) first prepare a five per cent weight by volume solution of Potassium Iodine (analytical 

reagent quality) in distilled water; 

(ii) to this, add Iodine (analytical reagent quality) in requisite amount to prepare an exactly 

0.04 normal Iodine solution; 

(iii) thereafter, compare the colour of the mineral oil under test with the Iodine solution so 

prepared. 

106 

 
Tariff 
Item 

(1) 

Description of goods 

(2) 

Unit  Rate of 
Duty 

(3) 

(4) 

2709  Petroleum oils and oils obtained from bituminous minerals, crude. 

Kg.  ….. 

2709 
10 00 

2709 
20 00 

2710 

- Petroleum oils and oils obtained from bituminous minerals 

Kg.  ….. 

- Petroleum crude 

Nil 

Petroleum  oils  and  oils  obtained  from  bituminous  minerals,  other  than 
crude;  preparations  not  elsewhere  specified  or  included,  containing  by 
weight 70% or more of petroleum oils or of oils obtained from bituminous 
minerals, these oils being the basic constituents of the preparations; waste 
oils 

- Petroleum oils and oils obtained from bituminous minerals (other than crude) 
and preparations not elsewhere specified or included, containing by weight 70% 
or more of petroleum oils or of oils obtained from bituminous minerals, these 
oils being the basic constituents of the preparations, other than those containing 
biodiesel and other than waste oil 

2710 
12 

2710 
12 11 

2710 
12 12 

2710 
12 13 

-
- 

-
-
- 

-
-
-
- 

-
-
-
- 

-
-
-
- 

Light oils and preparations: 

Motor spirit (Commonly known as petrol): 

Special boiling point spirits (other than benzene, toluol) with nominal boiling 
point range 55-115 °C 

Special  boiling  point  spirits  (other  than  benzene,  toluene  and  toluol)  with 
nominal boiling point range 63-70 °C 

Other  Special  boiling  points  spirits  (other  than  benzene,  benzol,  toluene  and 
toluol) 

Kg.  14%+Rs 
15.00 per 
litre 

Kg.  14%+Rs 
15.00 per 
litre 

Kg.  14%+Rs 
15.00 per 
litre 

107 

 
 
 
 
 
 
 
 
 
 
 
 
 
Tariff 
Item 

(1) 

2710 
12 19 

2710 
12 20 

1[2710 
12 39 

2710 
12 41 

2710 
12 42 

2710 
12 43 

2710 
12 44 

2710 
12 49 

2710 
12 90 

-
-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

Description of goods 

(2) 

Other 

Natural Gasoline Liquid 

Solvent 145/205 

Unit  Rate of 
Duty 

(3) 

(4) 

Kg.  14%+Rs 
15.00 per 
litre 

Kg.  14%+Rs 
15.00 per 
litre 

Kg.  … 

Motor  Gasoline  conforming  to  standard  IS  2796,  IS  17021,  IS  17586  or  IS 
17076: 

Motor Gasoline conforming to standard IS 2796 

E 20 Fuel conforming to standard IS 17021 

E 12 Fuel conforming to standard IS 17586 

E 15 Fuel conforming to standard IS 17586 

M 15 Fuel conforming to standard IS 17076 

Other 

Kg.  14%+Rs 
15.00 per 
litre 

Kg.  14%+Rs 
15.00 per 
litre 

Kg.  14%+Rs 
15.00 per 
litre 

Kg.  14%+Rs 
15.00 per 
litre 

Kg.  14%+Rs 
15.00 per 
litre] 

Kg.  14%+Rs 
15.00 per 
litre 

1.  Subs. by Act 6 of 2022, S. 99 and Sch. IV (w.e.f. 1-5-2022). 

108 

 
  
  
  
                                                           
Description of goods 

(2) 

Unit  Rate of 
Duty 

(3) 

(4) 

Other: 

Superior Kerosene Oil (SKO) 

Kg.  ….. 

Aviation Turbine Fuel (ATF) 

Kg. 

14% 

Tariff 
Item 

(1) 

2710 
19 

2710 
19 10 

2710 
19 20 

2710 
19 30 

2710 
19 40 

2710 
19 50 

2710 
19 60 

2710 
19 70 

2710 
19 80 

2710 
19 90 

-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

-
-
- 

High Speed Diesel (HSD) 

Light Diesel Oil (LDO) 

Fuel oil 

Base oil 

Jute batching oil and textile oil 

Lubricating oil 

Other 

- Waste oil: 

Kg.  14%+Rs 
15.00 per 
litre 

Kg.  ….. 

Kg.  ….. 

Kg.  ….. 

Kg.  ….. 

Kg.  ….. 

Kg.  ….. 

….. 

2710 
20 00 

Petroleum oils and oils obtained from bituminous minerals (other than crude) 
and preparations not elsewhere specified or included, containing by weight 70% 

Kg.  ….. 

109 

 
 
 
 
 
 
Tariff 
Item 

(1) 

Description of goods 

(2) 

Unit  Rate of 
Duty 

(3) 

(4) 

or more of petroleum oils or of oil obtained from bituminous minerals, these oils 
being the basic constituents of the preparations, containing biodiesel, other than 
waste oils 

2710 
91 00 

-
- 

Containing  polychlorinated  biphenyls  (PCBs),  polychlorinated  terphenyls 
(PCTs) or polybrominated biphenyls (PBBs) 

Kg.  ….. 

Kg.  ….. 

Kg. 

14% 

Kg.  ….. 

Kg.  ….. 

Kg.  ….. 

Kg.  ….. 

Kg. 

14% 

Kg.  …..] 

2710 
99 00 

-
- 

Other 

2711 

Petroleum gases and other gaseous hydrocarbons 

- Liquefied: 

2711 
11 00 

2711 
12 00 

2711 
13 00 

2711 
14 00 

2711 
19 00 

-
- 

-
- 

-
- 

-
- 

-
- 

Natural gas 

Propane 

Butane 

Ethylene, propylene, butylene and butadiene 

Other 

- In gaseous state: 

2711 
21 00 

2711 
29 00 

-
- 

-
- 

Natural gas 

Other 

110 

 
 
 
 
 
 
 
 
 
 
 
