Welcome to Central Excise Commodity Data Base CEDB

Welcome to Central Excise Commodity Data Base (CEDB) of DGOV 1

Directorate of Valuation (DOV) was established in the year 1997. It was upgraded to a Directorate General in December 2002. Data bases developed by the DGOV National Import Database (NIDB) Export Commodity Database (ECDB) Central Registry Database (CRD) Central Excise Database (CEDB)

This presentation has THREE parts First a brief background of CEDB Second details about the CEDB and other Valuation tools including Central Excise Valuation Bulletin Current work and future planning

BRIEF BACKGROUND The proposal to have a Central Excise Data Base (CEDB) was mooted in the Chief Commissioner’s Conference in 2004. On 16 October 2007, Board communicated a list of sensitive commodities which CEDB should contain. 4

The commodities identified were • Textiles • Steel • Other metals • Paper • Dyes and pigments • Wood Products like plywood, boards • Aromatics, olefins, petrochemicals • Polymers/Plastics like PVC, PP, LDPE • Petrochemical Intermediaries such as MEG, PTA, DMT 5

Actual work of preparing the Database started in July 2008, pursuant to letter dated 14. 5. 08 from then Member (Excise) Shri V Sridhar to all Chief Commissioners to furnish the requisite information sought by Directorate General of Valuation (DGOV) 6

HOW THE DATABASE IS PREPARED Part II • The CEDB is prepared on the basis of monthly reports received from Zones and LTUs. • The reports in respect of the sensitive commodity as identified by the Board are received as an e-mail attachment in an Excel Sheet 7

Proforma of the reports received from the Zone Sr Zone Name ECC Comm' Description CETH Brand/ UQC Total Value of Average No of Unit Code ate/Div of Product Model/ (Unit Qty. Total Value Manufactur Grade/ Qua Sold Sale ed Specifi ntity cation Code ) 1 2 5 4 6 7 8 9 10 11 12 3 8

• The reports received are first consolidated in a single Excel Sheet. Entries incompatible with the database are rejected. • The data is then sorted out as per Chapter Head Sub Head (CHSH), description and Unit Quantity Code (UQC) wise. 9

Consolidation of Reports received from the Zones Sl. No. Zone Name ECC Comm. Descript CETH Brand/ UQC Total Quantity. Value of Total Sale of Unit Code ission of Model/ (Unit Sold erate product Grade/ Quanti / manufa Specific ty Divisi ctured ation Code) on 1 1 2 3 4 5 6 Luckn GAIL AAAC Kanpu LLDPE ow (India) G 120 r/ Ltd. 9 JXM Agra 006 7 8 390110 Glene 10 Glex 9 Kg 2 Luckn GAIL AAAC Kanpu HDPE ow (India) G 120 r/ Ltd. 9 JXM Agra 006 390120 Glene 00 Glex Kg 3 Luckn Vacme AAAC Luckn Plastic 391590 ow t V 5120 ow/ Wastage 90 Packa BXM 0 Aligar ging 01 h Pvt. Ltd. Unit II -- Kg. 10 7810479. 000 11 522559168. 000 29896340. 000 1955393037. 000 20489. 200 372544. 000 Weighted Average 12 66. 9000 65. 4000 18. 1800 10

Sorted data for the Month of June 2010 Sl. No. Zone Name of the Unit ECC Commissi Code onerate/ Division Description of product manufactured CETH 1 2 3 4 5 6 7 29 Ahmedabad Jindal Saw AABCS 7 Rajkot / Granulated Slag 26180000 Ltd. (IPU) 280 CXM Gandhidh 007 am 51 M-I 97 Bangalore 9 MT 10 11 10945. 94 6567564. 00 12 600. 00 26180000 … MT 1112. 11 111211. 00 100. 00 Granulated Slag 26180000 2 MT 100. 00 600. 00 26190000 MT 148. 77 145454. 00 977. 74 M/s Rail TEMPB 8 BII / C DN (Iron) Foundary 26190090 Wheel 088 NXM Slag Cake Factory, 001 MT 411. 31 4443243. 00 10802. 66 M/s. Metr AABCM Thane-I/ o Ispat 8021 HX Kalyan-I Pvt. Ltd. M 001 Slag Mill Scale 282 Ahmedabad Krushna AAFFK 1 Bhavnaga Steel 866 KXM r / City Industries, 001 Div. Sihor MILLS SCALE 26190090 Nil MT 58. 65 54 ZINC DROSS 26190090 - MT 142. 48 M-I Weighted Average 8 N. A 31 Ahmedabad Saurashtra AAJCS 01 Rajkot / Ferrous P. 60 PXM 0 Gandhidh Ltd. 01 am Brand/ Unit Total Value of Model/ Qty. Quantity Total Sale Grade/ Code sold Specifica tion M/S JSW AAACJ 4 Thane. Ltd 323 NXM I/Kalyan 002 II 11789. 00 100. 00 600. 00 Single Entry 201. 01 9799516. 00 68778. 19 11

• From the sorted data minimum and maximum average value for the product/commodity are copied to a new Excel Sheet to make CEDB for the month. • The exceptionally high and low values for a product/commodity are also indicated below the respective CETH. 12

• The CEDB is than circulated to all the Zones along with the details of the units containing exceptionally high and low values as annexure to the CEDB. • The CEDB is also uploaded on the DGOV’s website on monthly basis. 13

EXTRACT OF CEDB FOR THE MONTH OF JUNE 2010 Zones: - Ahmedabad, Bangalore, Bhubaneshwar, Chandigarh, Chennai, Coimbatore, Delhi, Hyderabad, Jaipur, Kolkata, Lucknow, Meerut, Mumbai-I, Mumbai-II, Mysore, Nagpur, Pune, Ranchi, Shillong, Visakhapatnam, and LTU-- Bangalore, Chennai, Delhi, Sr. No. Description CETH No. of UQC Minimum Maximum Ratio of Units/ Average Minimum Entries Maximum Average (7/6) (1) 1 2 3 4 5 6 7 (2) IRON ORE/SLAG Granulated Slag CHEMICALS Sulphuric Acid Tolune Methnol Ethyl Acetate S. O. Dyes - Reactive Dyes - Black Printing Ink 8 PLASTICS Linear Low Density Polyethylene (LLDPE) 9 10 Expandable Polystyrene Poly vinyl chloride resins (PVC Resin) (3) 26180000 28070010 29023000 29051100 29153100 32041680 32151990 39011010 39031100 39042110 (4) 2 2 2 2 3 2 3 (5) MT Kg Kg Kg (6) 100. 00 5. 76 40. 23 12. 05 39. 21 128. 00 150. 62 71. 82 80. 41 47. 29 (7) 600. 00 7. 77 43. 60 12. 82 40. 81 133. 09 166. 02 97. 31 81. 91 51. 36 (8) 6. 00 1. 35 1. 08 1. 06 1. 04 1. 10 1. 35 1. 02 1. 09 14

Central Excise Database (CEDB) prepared on the basis of Zonal report received. Month No. of entries Percentage of No. of products / & Year No. of received rejected entries rejected commodities in CEDB Zones LTU (1) 2 (i) (2 ii) (3) (4) (5) (6) Jul-08 10 0 1615 151 9. 35 92 Aug-08 13 0 2118 317 14. 97 139 Sep-08 19 0 2761 440 15. 94 116 Oct-08 17 0 3630 938 25. 84 189 Nov-08 19 0 3284 678 20. 65 220 Dec-08 16 0 3549 897 25. 27 169 Jan-09 18 0 3503 1126 32. 14 216 Feb-09 15 0 2562 845 32. 98 174 Mar-09 14 0 2837 770 27. 14 175 Apr-09 13 2 2058 739 35. 91 147 May-09 19 2 2838 1002 35. 31 198 Jun-09 23 4 4239 1213 28. 62 227 Jul-09 23 4 3890 1112 28. 59 232 Aug-09 22 4 3635 817 22. 48 226 15

250 No. of products / commodities in CEDB 200 150 No. of products / commodities in CEDB 100 50 0 1 2 3 4 5 6 3 6 9 2 5 8 1 4 7 0 3 6 9 2 6 7 8 8 9 9 0 9 9 9 0 3 3 3 4 0 16

Au 09 g- 9 l-0 1000 Ju 1500 9 2000 -0 9 2500 Ju n -0 ay M 09 r- Ap 09 ar - M 09 b- Fe 09 Ja n- 8 -0 ec D 8 -0 ct ov N O 08 08 g- p- Se Au 8 Ju l-0 4500 4000 3500 3000 No. of entries received No. of entries rejected 500 0 17

8 ov -0 8 D ec -0 8 Ja n 09 Fe b 0 M 9 ar -0 9 Ap r 09 M ay -0 9 Ju n 09 Ju l-0 9 Au g 09 N -0 O ct 08 p- Se 8 08 g- Au l-0 Ju 40 Percentage of entries rejected 35 30 25 20 15 10 Percentage of entries rejected 5 0 18

Break up of the rejected entries Data rejected on the following reasons: Jul-09 Jun-09 May-09 Apr-09 Mar-09 Feb-09 Nil Entries 521 512 483 399 398 393 UQC Not Proper 354 444 294 205 222 251 Commodity not selected 171 182 177 94 82 97 Incomplete CETH 24 35 26 14 12 31 One Value entry representing more than one CETH 24 27 20 21 31 32 Figures reported did not appear proper etc. 18 13 11 6 25 41 19

600 Break up of the rejected entries (Bar chart) Nil Entries 500 UQC Not Proper 400 Commodity not selected 300 Incomplete CHSH 200 One Value entry representing more than one CHSH 100 0 333 999 899 Figures reported did not appear proper etc. 20

• Single entries being unit specific are not included in the database as no comparison is possible. The Number of single entries in the database from March 2009 to August 2009 is tabulated below Month/Year Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Single entries 345 295 401 403 478 514 21

4500 4000 3500 3000 2500 Total entries Rejected entries Single entries 2000 1500 1000 500 0 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-0 22

HOW CEDB CAN BE USED • CEDB by providing maximum and minimum Values for a product/commodity serve as a benchmark for prices for assessing officers • With help of database price trends of particular product or a commodity over a specified period of time can be found, with this more focused audit and preventive checks can carried out 23

• In case of exceptionally low average value, prima facie inquires can be undertaken to ascertain the reason, if low values are not justified further investigation may lead to detection of cases of undervaluation 24

EXCISE VALUATION BULLETIN (EXTERNAL SOURCES) Part III Member (Central Excise) Vide his letter dated 22/10/2009 desired to bring out Central Excise Valuation Bulletin by compiling prices of identified commodities from various external sources such as Business Magazines, News papers, Websites, Trade and association publications containing price data by December 2009 25

• The first Valuation Bulletin on Central Excise side was released by Chairmen CBEC on 11 th December 2009 in Mumbai. • Apart from the price data, the Bulletin also contains information about important case laws on Central Excise Valuation and modus operandi of important cases of undervaluation in Central Excise • The Bulletin is uploaded on the DGOV website regularly 26

Future Planning • With implementation of ACES, efforts are being made to extract the CEDB directly from the Data ware house( DWH) , DG Systems, this will make issue related to Data quality even more important • Develop a software/ Query Module on the lines of Mulayankan for analysis and retrieval of data as per user requirement 27

• Bring out Commodity/Product specific valuation studies pointing trends from the database and analyses with the price data from external sources • Expand Database to include all products and commodities to make it a truly national commodity database • Provide inputs for risk based assessment of returns for ACES 28

Conclusion CEDB is not a magic bullet to solve all Valuation problems It is one of sources of information that can be referred to find out bench mark price of the commodity A preliminary inquiry can be conducted if prices declared are way out of line with those in the database Local intelligence inputs, past record of the manufacturer and other relevant details may be collected 29

THANK YOU Presented By Sandeep Jain Additional Commissioner DGOV Comments at: 8 srjain@gmail. com sandeep. jain@icenet. gov. in 30