Lok Sabha Question No. 4856 (UNSTARRED), answered on 2016-12-16
Subject: Irregularities in Taxes
Ministry: FINANCE
Asked by: ALOK SANJAR

## †4856. SHRI ALOK SANJAR:

Will the Minister of FINANCE be pleased to state:

- (a)  whether  the  cases  of  irregularities  in  excise  duty  and  service  tax  committed  by  drug manufacturing companies reported in the country;
- (b) if so, the details thereof during each of the last three years and the current year, companywise; and
- (c) the amount of said duties/taxes recovered from each such company during the said period as on date?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI SANTOSH KUMAR GANGWAR)

- (a)  and  (b):  Yes,  some  cases  of  irregularities  have  been  detected  against  drug  manufacturing companies.  However,  data  relating  to  irregularities  in  Central  Excise    and  Service  Tax  is  not maintained centrally, commodity wise or in terms of manufacturing product companies.  The total number  of  detection  and  recovery  made  in  respect  of  Central  Excise  and  Service  Tax  evasion cases during 2013-14 to 2016-17 (upto October, 2016) is given in the ANNEXURE.
- (c) Details of cases detected by Directorate General of Central Excise  and Intelligence under Central Board of Excise & Customs, during the last three years and current year as well as duty recovered from the drug manufacturing companies is given in ANNEXURE.

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE LOK SABHA

UNSTARRED QUESTION NO. 4856

TO BE ANSWERED ON FRIDAY, DECEMBER 16, 2016/ AGRAHAYANA 25, 1938

(SAKA)

## IRREGULARITIES IN TAXES

## ANNEXURE

## Annexure referred to in reply to of Lok Sabha USQ No. 4856 dated 16.12.2016

The total number of detection and recovery made in respect of Central Excise and Service Tax evasion cases during 2013-14 to 2016-17 (upto October, 2016)

(Rs. in crore)

|                        | Detection      | Detection      | Detection    | Detection   | Recovery       | Recovery       | Recovery     | Recovery    |
|------------------------|----------------|----------------|--------------|-------------|----------------|----------------|--------------|-------------|
| YEAR                   | Central Excise | Central Excise | Service Tax  | Service Tax | Central Excise | Central Excise | Service Tax  | Service Tax |
|                        | No. of Cases   | Amt.           | No. of Cases | Amt.        | No. of Cases   | Amt.           | No. of Cases | Amt.        |
| 2013-14                | 2606           | 4736.59        | 9215         | 14842.32    | 2085           | 812.87         | 10075        | 5102.94     |
| 2014-15                | 2123           | 4334.80        | 6719         | 10544.33    | 1614           | 546.16         | 7703         | 4448.48     |
| 2015-16                | 2366           | 5296.84        | 7534         | 18970.86    | 1642           | 803.78         | 9086         | 4658.28     |
| 2016-17 (Upto October) | 1173           | 2990.00        | 4456         | 9030.67     | 782            | 377.00         | 4432         | 2334.00     |

The details of cases of Central Excise duty evasion against drug manufacturing companies detected by the Directorate General of Central Excise and Intelligence during the last three  years and current year as well as duty recovered therefrom is given below:-

(Rs. In Crore)

| Year    | Name and address of company                                                                                                      | Issue involved                                                                                                                                                                                                          |   Central Excise duty involved | Realisation                            |
|---------|----------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------|----------------------------------------|
| 2013-14 | M/s Shree Krishna Keshav, having Central Excise Registered address as Nr. New Cotton Mill, B/h. Indranagar, Amraiwadi, Ahmedabad | Wrong availment of benefit of Notification No. 06/2002 dated 01.03.2012, Notification No. 04/2006- CE dated 01.03.200, Notification No. 01/2011- CE dated 01.03.2011 and Notification No. 16/2012- CE dated 17.03.2012. |                           0.99 | Nil                                    |
|         | M/s Haseeb Pharmaceuticals Pvt. Ltd., Plot No. F 9/15, MIDC, Hingna, Nagpur-440016                                               | Wrong availment of benefit of Notification No. 06/2002 dated 01.03.2012, Notification No. 04/2006- CE dated 01.03.200, Notification No. 01/2011- CE dated 01.03.2011 and Notification No. 16/2012- CE dated 17.03.2012. |                           0.32 | 0.32 +0.14 (Interest)+ 0.015 (Penalty) |
|         | Anjaneya Lifecare Ltd. K-                                                                                                        | Wrong utilization of Cenvat                                                                                                                                                                                             |                           0.24 | 0.24                                   |

|                        | 4/1, Additional MIDC, Mahad, Distt. Raigad,                                 | input credit availed on inputs which cannot be used   |      |                  |
|------------------------|-----------------------------------------------------------------------------|-------------------------------------------------------|------|------------------|
|                        | M/s Parabolic Drugs Ltd. SCO-99-100, Top Floor, Sector-17B, Chandigarh      | Evasion of Central Excise Duty                        | 4.62 | 4.07 (Till date) |
| 2014-15                | Flemingo Pharmaceuticals Ltd. (100% EOU), E-28, MIDC Taloja, Distt. Raigad  | Availment of inadmissible Cenvat Credit               | 0.02 | Nil              |
|                        | Flemingo Pharmaceuticals Ltd. R-662, TTC Ind Area, Rabale MIDC, Navi Mumbai | Availment of inadmissible Cenvat Credit               | 0.04 | Nil              |
| 2015-16                | M/s Parabolic Drugs Ltd. SCO-99-100, Top Floor, Sector-17B, Chandigarh      | Evasion of Central Excise Duty                        | 1.46 |                  |
| 2016-17 (TILL 31 Nov.) | M/s Parabolic Drugs Ltd. SCO-99-100, Top Floor, Sector-17B, Chandigarh      | Evasion of Central Excise Duty                        | 0.47 |                  |

No cases  of  Service  Tax  evasion  by  Drug  Manufacturing  Companies  were  detected  by  Directorate General of Central Excise and Intelligence.  Data relating to cases of Central Excise duty and Service Tax evasion by such companies, in respect of field formations is not maintained centrally.