Electronic Accounting System in Excise and Service Tax (EASIEST)

In August 2004, a HPC was set up in the RBI for "setting up facilities for on-line transmission of Tax Payment Data from Banks to Central Excise Dept. under the Chairmanship of Shri J. N. Nigam (Member) CBEC. The terms of reference of the Committee included recommending: modalities for dematerialization of Challans, setting up and implementing a fully automated safe and secure system of receipt and transmission of information relating to tax payments, new business processes for operationalising the scheme, overall policy frame work for the industry etc. Members included Director General (Systems), CBEC, Principle Chief Controller of Accounts (CBEC), Controller General of Accounts, representatives from Corporate Sector, RBI and IBA.
At the first meeting of the HPC on 24th September 2005, it was decided that the project may be implemented in two phases viz. the first Excise and then Service Tax. It was decided to constitute 2 sub-committees: a Technical Sub-committee under Shri R. N. Ramanathan, DMD, SBI to work out the technical requirements of the project and a Sub-committee on Accounting Procedure chaired by Shri V. N. Kaila, Pr. CCA, CBEC to work out the accounting procedures for the project.
NSDL was identified as the intermediary for the transmission of Tax Information. In place of the quadruplicate, only a single copy of the challan would be submitted and the tear off portion containing the Challan Identification Number (CIN) would be handed over by the collecting bank branch to the assessee. The CIN number is the unique identifier for a challan. It consists of the Challan Number, Date of submission of Challan and the BSR code of the collecting branch. A combination of the three helps to identify the challan uniquely. The Technical Sub-committee worked out the file structures, the work flow etc. for the on-line transmission of tax-data based on the concept paper submitted by the CBEC.
The second HPC meeting was held at RBI on 5th November 2004. At the meeting, it was decided to start a Pilot at Chennai limiting the Pilot to Excise in the first phase. Thus, a pilot was started at Chennai from 17th January 2005 involving 5 branches of each of the 8 banks authorized to collect excise at Chennai. A single copy challan with a tearoff counterfoil called GR7 was introduced during the Chennai pilot.
On 1st June 2005, the Pilot was extended to all the 400 branches in and around Chennai, covering all the 4 commissionerates in Chennai.

EASIEST process Document.

Process to be followed at collecting branch

• Collecting branches to capture Challan details on the date of receipt of the challan irrespective of Cash or clearing cheques. This will ensure automatic capture of tender date by the system.
• Provision to be made for automatic capture of the following fields for every challan as a part of data entry:-
  1. BSR Code of Collecting Branch
  2. Challan tendered date
  3. Challan Sequence Number (CIN)
  4. BSR Code of Focal Point Branch.
  All these fields to be automatically captured by the system and should not be normally editable fields. In case of a need to edit any of these fields for some reason, it should be possible only on the basis of a supervisor authorization.
• Data entry software should identify the concerned Major Head from the Assessee code itself and the 8 digit reduced account codes needs to be selected from pop-up only. In case the Assessee code is not available or not validated, the software should provide option to select the Major Head and reduced account code through pull down menu only.
• System to provide the facility for data entry of Assessee Code. Once the Assessee Code is entered, the same will be validated against the Assessee Master provided by NSDL.
• Banks should periodically update the Assessee Master through the patches provided by NSDL.
• In case the Assessee Code is not available in the master, then software to prompt the user to Capture Name & Address of the Assessee. In addition, system to ensure capture of Location Code. If the complete Location Code is not available, bank should ensure capture of the first two digit (Commissionerate Code) correctly may be after confirming from the taxpayer and the other four digits can be filled as zeros. This will enable Commissionerate -wise scrolling of challans.
• If the Assessee Code is valid, then the Name and Address, Location Code etc are to be automatically be picked up from the Assessee Master and no editing of these fields should be allowed.
• All other mandatory fields are to be captured on the date of tender. In case mandatory details mentioned in challan are not captured, software to prompt User to capture same.
• Software should have Maker and checker feature for data entry. Software should generate Challan number (CIN) based on date of tender.
• At EOD, all realized payments to be compiled and date of realization for the same will be captured by the system automatically. For Cash transactions, cheque realization date to be the same as date of tender.
• Each challan will be given a running serial number based on its item number in the scroll. This number is to be allotted while scrolling the challans Commissionerate-wise and Major Head-wise for the day. The item number of the challan in the scroll will be number and to be captured in the new field BR_SCR_ITEM_SL. Physical challans needs to be arranged under the hard copy of the computer generated scroll in the seriatim of BR_SCR_ITEM_SL number.
• At EOD, the software to generate daily scrolls Commissionerate-wise and Major Head-wise. The scroll number and scroll date appears on the system generated scroll should be captured automatically in the electronic string also. This will help in having synchronization of electronic data and physical documents.
• Subsequently, file to be generated which can be transmitted to Focal Point Branch for further processing along with Physical scrolls & challans.

Process to be followed at Focal Point Branch (FPB)

• Software to provide only view facility to the FPB
• System to provide a facility to view scroll details and also underlying challans.
• On receipt of physical scrolls from the collecting branches, details of the scroll to be verified against the electronic data.
• In case of error, erroneous file to be reported back to the collecting branch and the file relating to that branch to be withheld.
• Remaining valid and verified files to be compiled and main scrolls are to be generated Commissionerate-wise and Major Head-wise.
• The Main Scroll number and scroll date appearing on the hard copy of the system generated scroll should be same in the electronic string also.
• Only the branch scrolls against which the physical challans have been reached the FPB and verified for its correctness against the corresponding electronic string to be consolidated to be uploaded to link cell and then to NSDL.
• Hard copy of the System generated Main scrolls together with the hard copy of receiving branch scrolls and underlying physical challans are to be sent to PAO.
• Hard copy of the receiving branch scrolls and underlying physical challans are to be arranged under the Hard copy of the Main scroll in seriatim as they appear on the Main scroll before sending the same to PAO.