Central excise duty collection falls by Rs 1,048 cr in T-region

Hyderabad: Notwithstanding the improved power supply situation in the state over the last few months, the manufacturing sector seems to be in an extremely bad shape if central excise duty collection is any indication.

Central excise duty collections in the Telangana zone, specifically Hyderabad, reduced by Rs 1,048 crore this financial year vis-a-vis the last financial year. So much so, that sources said finance minister P. Chidambaram is livid with the downturn in excise collections, saying that the Telangana zone is the worst performing.

Sources in the Central Board of Excise and Customs said the problems could be fundamental, but also blamed the political turmoil. Sources also say that the fall this year is more pronounced than last year, which was the worse year for industries in the state.

Much of the excise duty that goes to the central government from the Telangana zone is contributed by large-scale manufacturing units in Hyderabad. Manufacturing units in the city contributed to about Rs 2,650 crore of excise duty out of the total Rs 3,870 crore from the Telangana zone this financial year so far.

The excise duty target, though, is set at Rs 5,400 crore for 2013-14. “Excise duty collections fell by about Rs 1,048 crore from Telangana, till November this financial year vis-a-vis the same period last year. And the fall is much more significant than in the last financial year when we expected otherwise. The finance minister was very unhappy with this,” CBEC sources said.

Of the Rs 1,048 crore fall in collections, Rs 600 crore was from Hyderabad. The city has a large manufacturing sector with 14 industrial clusters in Greater Hyderabad. Almost all the manufacturing units are liable to pay excise duty. Industry experts say that manufacturing is faring badly this year.