Central Excise Revenue Audit

 

Central Excise Revenue Audit (CERA) is one of the receipt audit wings of office of the Principal Director of Audit (Central), Kolkata.  Audit of receipt is one of the most important functions assigned to the Comptroller and Auditor General of India (C& AG).

Audit Mandate
The C& AG of India, who is the head of the Supreme Audit Institution of India derives his duties and powers mainly from Article 149 to 151 of Constitution of India.  The Comptroller and Auditor General (Duties, Power and Conditions of Service) Act. 1971 came into force from 15 December 1971, Section 16 or that Act provides:- “It shall be the duty of the Comptroller and Auditor General to audit all receipts which are payable into the Consolidated Fund of India and of each State and of each Union Territory having a Legislative Assembly and to satisfy himself that the rules and procedures in that behalf are designed to secure an effective check on the assessment, collection and proper allocation of revenue and are being duly observed and to make for this purpose such examination of accounts as he thinks fit and report thereon.”

With the passing of this Act, it has become the statutory responsibility of the C&AG of India to audit receipts of the Union and States. Tax receipts constitute both direct and indirect taxes.  Central Excise Duty (an indirect tax) is a tax on manufactured products.  Service Tax is a tax on service provided.  It is the responsibility of the Central Excise Departmental authorities to see that Central Excise Duties and Service tax are properly paid by different manufacturing units and service providers.  The duty of the Central Excise Revenue Audit (CERA) is to see that sums due to Government are properly assessed, realized and credited to the Government account.

Statutory audit
The audit of receipt conducted by the CERA wing is statutory audit and is done at different levels
 
(i) Headquarter level
 
Scrutiny of Act, Rules, notifications and circulars and instructions issued by the Government of India, Central Board of Excise and Customs is done at Headquarter level.
 (ii) Field level
 
Audit at field level is conducted by field parties (consisting of 4 to 5 officials), mainly by visiting
(a)
   Central Excise range offices/Divisional offices/Commissionerate offices
(b)
  
Factories

Audit to have access to all records
Member of the audit department will have access to relevant papers and records of Central Excise department and of such records as are authorized to be scrutinized under rule 22 (3) of Central Excise Rules, 2001 in regard to accounts maintained by assessee working under the ‘Self Removal Procedure’.

Reports
The field parties after completion of the audit submit a inspection report detailing their observations.  This report is then scrutinized at CERA headquarter and depending on the importance of the particular cases either pursue the cases locally or forward it to C & AG’s office at New Delhi.  The C & AG’s office based on the merit of the case takes it up with the Finance Ministry and may also decide to bring the case to Parliament’s notice through Audit Report.  After the report is laid on table of both the houses of Parliament, important cases are taken up by the Public Accounts Committee for discussion with the Ministry and issuance of comments.

Organisational setup
The Central Excise revenue audit is conducted under the overall supervision of the Principal Director of Audit (Central), Kolkata.  The CERA wing function under the charge of a Group Officer supported by field inspection parties and head quarter staffs.  Each field inspection party is headed by a Sr. Audit Officer/ Audit Officer (A.O) and consists of one to two Asstt. Audit Officer (AAO)/ Section Officer(SO) and one or two Sr. Auditor/ Auditor.  The work at CERA head quarter is managed by a group of well experienced Sr A.Os, A.Os, AAOs, SOs and Auditors.