Central govt acts tough, shipbreakers go on strike in Alang

The strike by shipbreakers in Alang has brought shipbreaking activities to a halt from 21st December with the ship-breakers protesting a notification issued by Central Excise (CE), Government of India that seeks a ship-wise break-up. The strike has continued for the third day.

The strike by ship-breakers is an attempt to pressurize the the central government. They protesting on the grounds that as they dismantled more than one ship at a time, it was not possible to furnish ship-wise details of material obtained.

This notification was issued on 26 July, 2010 where ship-breakers were asked to periodically give details of excisable and non-excisable items obtained from the ships they bring for scraping. This was after CE's intelligence wing had found large scale duty evasion by some ship breakers who used to inflate the quantity of non-excisable items.

ToxicsWatch Alliance feels that the excise officials are right in saying that the ship-breakers were not complying with all the requirements of the notification.

The Central Excise duties are the largest source of revenue for the country. Approximately 30% of the total revenue receipts are collected from Central Excise duties. The levy and collection of Central Excise duties is under the authority of Central Excise Act, 1944. Section 3 provides for the levy and collection of Central Excise duty.

The rate and amount of duty as well as the items on which duties are levied are those which are indicated in the Central Excise Tariff Act, 1985 and the schedule therein. The taxable event for Central Excise duty as per Section 3 of CEA (Central Excise Act) 1944 is the manufacture or production of goods.

It means that Central Excise duty is leviable as soon as the goods are manufactured or produced. The items on which the excise duty is levied are known as excisable goods.

For the purpose of administrative convenience the actual collection of duty is done at the time of removal of goods from the place of manufacture of production. The rate of duty, which is levied, is the rate of duty applicable to such goods or which is in force at the time of actual removal.