“Set-off” of export receivables against import payables

“Set-off” of export receivables against import payables

Background:

The Reserve Bank of India (RBI), till date, has approved “set-off” of export receivables against import payables in respect of the same overseas buyer and supplier on cash to cash basis.

Amendment:

In a major move at delegating more powers to banks, the Reserve Bank of India has empowered Authorised Dealer Category-I banks (AD Category-I Banks) to deal with the cases of “set-off” of export receivables against import payables. This ‘setoff’ required the nod of RBI earlier. The RBI, in its press release, states that it has been allowing requests from the exporters through their AD Category 1 banks for such “set-off” subject to conditions and it has decided to delegate such power now.

The RBI, vide A.P. (DIR Series) Circular No. 47, dated 17 November 2011, has decided to delegate power to Authorized Dealer (AD) banks to deal with the cases of “set-off” of export receivables against import payables, subject to the following terms and conditions:

• Import is as per the Foreign Trade Policy in Force;
• Invoices/ Bills of Lading/ Airway Bills and Exchange Control copies of Bills of Entry for home consumption have been submitted by the importer to the AD bank
• Payment for the import is still outstanding in the books of the importer
• Both the transactions of sale and purchase may be reported separately in ‘R’ Returns
• The relative GR forms will be released by the AD bank only after the entire export proceeds are adjusted/ received
• The ” set-off” of export receivables against import payments should be in respect of the same overseas buyer and supplier and that consent for ”set-off” has been obtained from him
• The export/ import transactions with Asian Clearing Union countries should be kept outside the arrangement
• All the relevant documents are submitted to the concerned AD bank who should comply with all the regulatory requirements relating to the transactions.

Procedure to Form/Incorporate Limited Liability Partnership (LLP) Firm in India

Procedure to Form/Incorporate Limited Liability Partnership (LLP) Firm in India

STEPWISE FORMALITIES FOR FORMATION OF A NEW LLP

Persons desirous of forming a Limited Liability Partnership Firm must adhere to the step by step procedure as discussed below:

•   Requirement of Partners;
• Apply for Designated Partner Identification Number (DPIN) and Digital Signatures, if does not have;
• Selection of name for the proposed Firm;
• Drafting of LLP Agreement for Firm;
• Stamping, digitally signing and e-filing of various documents with the Registrar;
• Payment of Fees;
• Verification of documents/forms by ROC;
• Obtaining Certificate of Incorporation.

1.    Requirement of Partners:

To form a LLP, there should be Minimum two partners and at least two shall be designated partners having DIPN. In case of body corporate as partners, their nominee can be act as designated partners. Out of two designated partners, one must be resident in India. (Who has stayed in India for a period of not less than one hundred and eighty two days during the immediately preceding financial year)

2. Designated Partner Identification Number (DIN) & Digital Signature Certificate (DSC):

·         DPIN

All designated partners of the proposed LLP shall obtain “Designated Partner Identification Number (DPIN)”. You need to file eForm DIN-1 in order to obtain DIN or DPIN. In case you already have a DIN (Director Identification Number), the same can be used as a DPIN.

Note: Copy of PAN card mandatory for all Indian Applicants & Copy of Passport mandatory for foreign national or NRIs. In case of Partner is foreign national or NRIs identity & address proof should be notarized by an Indian Consulate of home country & address proof should not be older more than 1 year from the date of filing of form.

·         DSC

Digital Signature Certificate (DSC) is the digital equivalent (i.e. electronic format) of physical or paper certificates. A digital certificate can be presented electronically to prove your identity, to access information or services on the Internet or to sign certain document digitally. Since, Ministry of Corporate Affairs (MCA) accepts electronic submission of Forms on its portal the DSC is mandatory for all the users.   

Documents required for obtaining DSC: 

Digital Signature Certificate application form (duly signed by applicant) & all same documents as required in DIN application form

3.    Selection of name for the proposed LLP:

The Partners have to provide at least 6 names in the order of their preference/priority. The partners can themselves search for the available names by visiting the MCA website.

After selecting name for the LLP time to file Application of Name Reservation with ROC in e-form 1, the applicant needs to give 6 proposed names in preferences/priority along with their meaning & significance of each word. This form should be digitally signed by the Designated Partner of Firm.

4.    Drafting of LLP Agreement for Firm:

LLP agreement has to be drafted line with LLP Act. It is not mandatory to file LLP agreement at the time of registration and same can be file with in 30 days. If no agreement is framed, provisions of Schedule I of the LLP Act shall be applicable.

5.    Stamping, digitally signing and e-filing of various documents with the Registrar:

After name approval following forms to be filed with ROC on the MCA website:

1)    Form-2 (Incorporation document & subscriber’s Statement), along with No. of Partners & Personal details thereof, Address Proof of Firm, Copy of Subscriber’s Sheet including consent. This form should be digitally signed by the Designated Partner & Chartered Accountant.

2)    Form-2A (Details in respect of designated partners and partners of Limited Liability Partnership), along with Copy of Subscriber’s Sheet including consent. This form should be signed by Designated Partners.

3)    Form-3 (Information with regard to Limited Liability Partnership Agreement and changes, if any, made therein). This form should be signed by Designated Partners.

6.    Payment of Fees:

After filing of documents online, we need to make payment to ROC fees & Stamp Duty electronically which is based upon the Authorised Capital of the LLP. Please refer to the “Fee Calculator” link on the MCA website for the ROC fees.

Note: Stamp Duty varies as per the “State” in which the LLP is to be registered. Please refer to the “Stamp Duty” link on the MCA website

7.    Verification of documents/forms by ROC:

After payment of all stamp duties & ROC fees, ROC scrutinizes all the documents & forms. In case of any objection/queries raised by ROC, resubmission of form may also require.

8.    Obtaining Certificate of Incorporation:

Once all the Forms are duly approved by ROC, the digitally signed “Certificate of Incorporation” is emailed to the Designated Partner.

As part of Green Initiative by the MCA, few Certificates including “Certificate of Incorporation” are now issued only in the electronic format i.e. softcopy (having digital signature of ROC). Once the Incorporation Certificate is received, LLP can start its operations.

 

Procedure For registration under Special Valuation Branch

What is Special Valuation Branch?
Special Valuation Branch is a Branch of the Custom House, specialising in investigating the transactions involving relationship between the supplier and the importer and certain other special features like Technical Collaboration between the parties, etc under Customs Valuation (Determination of Value of Imported Goods ) Rules 2007. ? .

Special Valuation Branch examines the influence of relationship on the invoice value of the imported goods in respect of transactions between related parties.?

In respect of Technical Collaboration Agreements and Joint Venture Agreements, the terms and conditions of these agreements are examined to arrive at the conclusion, whether the existence of such agreement has influenced the invoice value of the imports.


Who should register with SVB? For the purpose of Customs Valuation (Determination of Value of Imported Goods) Rules 2007 the following Persons shall be deemed to be ?related? / should register with SVB only if:

• They are officers or directors of one another's businesses
• They are legally recognised partners in business;
• They are employer and employee;
• Any person directly or indirectly owns, controls or holds 5 per cent or more of the outstanding voting stock or shares of both of them;
• One of them directly or indirectly controls the other;
• Both of them are directly or indirectly controlled by a third person;
• Together they directly or indirectly control a third person;
• They are members of the same family.

Explanation I - The term "person" also includes legal persons
Explanation II- Persons who are associated in the business of one another in that one is the sole agent or sole distributor or sole concessionaire, however described, of the other shall be deemed to be related for the purpose of these rules, if they fall within the criteria of this sub-rule.
Apart from the above, those who are having Collaboration Agreement, Technical Assistance Agreement or any other agreement / contract with the foreign supplier are also required to register with SVB.

Procedure for Registration with SVB?

• All those importers who are having relationship with the suppliers as mentioned above or those who are having Technical Collaboration, etc., shall furnish a declaration about the relationship in the GATT declaration form at the time of filing of Bill of Entry in the Appraising Group.

• On examination of the circumstances of sale and keeping in view the invoice value of identical or similar goods, the group will make a reference to Special Valuation Branch for further investigation of influence of relationship on assessable value.

• If the importer is able to furnish evidence of the transaction value of identical or similar goods in respect of sales to unrelated buyers in India at the same price, then there is no need for any reference to Special Valuation Branch and the Bill of Entry will be assessed finally based on those contemporaneous import values.

• If there are no contemporaneous imports, and there is no way to compare the values at the time of assessment of the Bill of Entry, then a reference is made to Special Valuation Branch.

• This reference is to be done with the prior approval of the Commissioner of Customs. If the importer can substantiate with documentary evidence that his invoice price is not influenced because of the relationship, there is no need for any reference to Special Valuation Branch.

• The Special Valuation Branch of that major Custom House, (out of the four - Chennai, Calcutta, Delhi and Bombay) which is located proximate to the Head or Corporate Office of the importer (having special relationships etc. with the suppliers), would handle the investigation into valuation of such importer.?

• No application or representation to the Special Valuation Branch directly by the importers will be considered.

• All references shall be made through the Appraising Groups at the time of filing of the Bill of Entry. On receipt of the reference from Appraising Groups, the case is registered in Special Valuation Branch and a PD Circular for provisional assessment is issued.

• Copies of the same are issued to the importer and to the Appraising Groups as well. The importer shall indicate the PD Circular No. at the time of provisional assessment of all their imports in the Appraising Group and execute PD Bond with 1% Extra Duty Deposit on the assessable value of the goods.

• Along with the PD Circular a questionnaire (Given Below) is also issued to be filled up by the importer along with the list of all documents required to be submitted.

Documents required to be submitted.?

The amount of extra duty deposit presently kept at 1% will be continued. Board has however decided that if the importer does not furnish complete reply to the questionnaire within 30 days of receipt of the 'Questionnaire' by the importer, the extra duty deposit will be increased to 5% till the date of receipt of reply by the Department.
The importers falling under the related category may keep ready all the documents along with the replies to the questionnaire, etc., at the time of first import itself, so that the case can be finalised as early as possible in the Special Valuation Branch.
NOTE: 1) Normally the SVB order is valid for a period of 3 years.
2) In all cases of loading, it is mandatory for the importer to quote Order in Original No. of SVB and indicate the percentage of loading at the time of filing of each Bill of Entry by them.If they do not quote the Order No. and the loading factor, it will be construed as misdeclaration on the part of importer and dealt with in accordance with the provisions of Customs Act.


Documents required for Registration with SVB & Annexure A (Questionnaire) :

ANNEX � A (SVB)

Questionnaire to be filled by importers who are related to the foreign suppliers.

1. Name of the importer with full address of the Head or Corporate office, registered office administrative office / factory and PAN No.
2. Whether the importer is a proprietorship/partnership/private limited company/public limited company/branch office of company incorporated outside India.
3. (a) Name of the foreign supplier from who the goods are imported (b) nature of the business relationship of the importer with the supplier (eg., subsidiary company/branch office/distributor/agent/indentor or any other) (c) nature of the transaction - eg., sale to the importer, consignment sales, branch transfer or any other.
4. Whether any officer or director in the company/firm of the importer holds any office in any company incorporated outside India; if so, whether such a company is related to / associated in any way with the supplier of the imported goods. Also give details of converse situation, if applicable?
5. Whether the importer and the supplier of the goods are partners in business?
6. Whether there is an employer-employee relationship between the importer and the supplier of the imported goods and vice versa?
7. Whether the foreign supplier or any of their associated companies jointly or severally, directly or indirectly own, control or hold equity shares worth % or more of the total paid up capital of your company or any of your associated companies?
8. Whether any other third person, jointly or severally, directly or indirectly owns controls or holds equity shares worth 5% or more of the foreign supplier and of your company including the associated companies?
9. a) Whether the supplier of the goods is in a position, directly or indirectly, to exercise restraint over you, legally or operationally, in any manner? (b) Specify the role if any, of the supplier or any of its associate business entities, in your corporate policy, design specification, quality control, marketing, sub-licensing of patent, franchise, etc? (c) Whether any legal liabilities created by contracts or agreements entered into by the supplier devolve on the importer?
10. Whether the importer is in a position, directly or indirectly, to exercise restraint over the supplier, legally or operationally, in any manner? Details as per (b) and (c) above for this converse position?
11. Whether a third party is in a position, directly or indirectly, to exercise restraint over both the importer and the supplier of imported goods, legally or operationally, in any manner? Details as per (b) and (c) of (9) above for this converse position?
12. Whether the importer and the supplier of the imported goods, together, are in a position, directly or indirectly, to exercise restraint over you, legally or operationally, in any manner? Details as per (b) and (c) of (9) above for this converse position?
13. Whether the importer and the supplier of the imported goods are members of the same family?
14. (a) Whether the importer is a sole agent, distributor or indentor appointed by the foreign suppliers. (b)Give the full particulars of all the suppliers of goods from outside India for whom the importer acts as agents/distributors/indentors?
15. Whether the importer is a branch or subsidiary of the supplier of the importer goods? (The word subsidiary has the same meaning as in section 4 of the Companies Act)
16. (a) Whether the importer is engaged in the local manufacture of any products of the suppliers of the imported goods? (b) If yes, whether the imported items are used in such manufacture? (c) If yes, whether the imported items are manufactured or exclusively supplied by the suppliers? (d) Whether the product manufactured by the importer using the imported goods is sold under a trade mark, design or patent owned or controlled by the supplier of the goods or any person related to them?
17. (a) Whether the imported goods are component parts in the SKD/CKD condition for local assembly into finished goods? If yes, furnish a complete list of items imported in CKD/SKD condition.
18. In the case of (16 and (17) above, are the same components imported by any person to India as spares for stock and sale? If so, please furnish the prices at which such imports are made.
19. Whether the importer has imported any capital goods, plants, machinery, equipment etc., from the foreign supplier of the imported goods or its related or associated concerns or persons? Please furnish details.
20. Is any amount paid or payable, directly or indirectly, to or on behalf of the supplier of the imported goods for engineering, development, art work, design work and plans and sketches undertaken elsewhere than in India and connected with the production of imported goods? Are any services rendered by or on behalf of the importer relatable to this?
21. Is the import of the goods covered under an agreement? Are there other agreements between the importer and the supplier? If yes, list them.
22. What is the basis of arriving at the price in the invoice? Is it (a) Price list with discount (b) net discounted price (c) quotation (d) Transfer price or (e) other (please specify)?
23. What is the form of payment by the importer for the imported goods? Furnish the heads of accounts under which other payments, if any, made to the supplier of the imported goods, and details of the payments/transfer of funds in any form
24. Furnish the total quantity and FOB value of imports made by the importer from the same supplier during the last three years.
25. Amount of royalty/technical knowhow fee/licence fee any other fee paid or payable by the importer to the supplier of the imported goods.
26. Furnish the full details of amounts, if any, received by the importer in the form of agency commission, overriding commission or any other remuneration received either from other importers in India or from the supplier of the imported goods.
27. Express incurred by the importer on behalf of, by understanding or agreement with, or under instructions from the supplier of the imported goods, eg., advertising, propaganda expenses or any other expenses for the promotion of the imported goods.
28. Whether the supplier of the goods supplies identical, similar or conncected items to buyers/branches/collaborators in other countries? If yes, prices at which such transaction have taken place, for the last one year.

List of Documents required to be submitted in case of Sole Agents/Sole Distribution/Sole Concessionaire

1. Agency agreements of the importer with any person.
2. Specimen copies of the import invoices and Bills of Entry
3. Specimen copy of invoices for import of identical, similar or connected goods by this part through the present importer.
4. Specimen copy of invoices for import of identical, similar or connected goods by a company associated with the importer.
5. Commission note and credit notes in case of amounts received from outside India.
6. Annual report of the importer's business concern for last three years.
7. Pricelists for import and sale of the imported goods.
8. Statement regarding percentage of shareholding of/in any Indian company alongwith common directors.
9. Statement regarding equity participation of/in foreign company.
10. Indent/invoices wise statement of commission received in last three years.
11. Details of remittances alongwith method, mode and deferred payment details, if any.
12. Statement of expenses as required under question number 28 of the questionnaire.

List of Documents required to be submitted in case of subsidiaries, holding companies, and those who have collaboration agreement or similar agreements

1. Collaboration agreement, Joint Venture Agreement and other agreements with the supplier of the imported goods or with any other person acting for the supplier.
2. Approval of Government of India/RBI to the agreement, if any.
3. Statements for last three years duly certified by the Chartered Accountant, containing the following informations:-
   1. CIF value and landed cost of imports from suppliers of the imported goods, the collaborator or associated companies.
   2. CIF value and landed cost of import from other suppliers.
   3. Value of standard bought out components procured in India.
   4. Ex-factory value of the goods.
   5. Royalty, net and gross Paid or payable.
4. Representative sample invoices of own imports for the last 3 years and photocopies of the relevant Bills of Entry.
5. Annual reports of importing Company for the last 3 years.
6. Statement regarding equity participation in/of foreign company for the last 3 years.
7. Statement regarding shareholding of/in any Indian company alongwith particulars of common Directors.
8. Current price list of product imported from the supplier of the goods including spares and warranty parts imported by any other person..
9. Representative specimen invoices of procurement of goods procured from some other person by the supplier and supplied importer.
10. Representative specimen invoices of procurement of identical, similar or connected goods made by companies associated with importer.
11. Representative specimen invoices of imports of identical of similar goods by any other person.
12. Representative specimen of invoices and bills of entry of imports of identical, similar items as spares and warranty parts by the importer or any other person.
13. Details of remittances alongwith method and mode and deferred payments details, if any.
14. Details regarding any other payment made to or on behalf or under the instructions of the supplier.

Procedure of Scrutiny Assessment u/s 143(3)

  Regular/Scrutiny Assessment Procedure U/s 143 (3)

For this notice is issued u/s 143(2). The salient features of this section are:

This notice can be issued only when the assessee has furnished return of Income u/s 139(1) or 142(1).The notice u/s 143(2) has to be served on the assessee within six month of expiry of financial year in which the return was furnished.

 Only 3% to 5% cases are taken for scrutiny assessment.

The assessing officer (AO) is not required to possess any ‘reason to believe’. In this assessment AO is charged with the duty to ensure that the assessee:

• has not understand the Income or

• has not computed excessive loss has not under paid taxes

Also while the scrutiny assessment is in process, the assessee can also put forth claims that he had not done in the ITR and these have to be considered by the AO.

Consequently, in his assessment u/s 143(3) the AO can even reduce income or assess loss higher than the returned loss.

The assessment u/s 143(3) is completed with an assessment order in writing which should contain the tax computed under the signature of AO.

Under this AO can also do protective assessment-i.e. assess the same income in hands of more than one person till it becomes clear in whose hand the income should be assessed. Protective assessment is undertaken so that there is no loss to revenue.

If assessment u/s 143(3) is done on basis of invalid return- the assessment order continues to operate till it is invalidated by the court.

On remand (i.e. if the cases goes to ITAT  on some points, and ITAT sends it back to AO for reconsideration or correction on question  of fact or law) only the specific point can be dealt by the AO. On remand, the AO cannot bring in new sources of income or open new issues.

Assessment made under this section would be final and the department cannot open the case again unless there are valid reasons (‘reasons to believe’). These are dealt in reassessment proceedings.                  

 

Procedure for Service Tax Registration

Procedure for Service Tax Registration

Registration:

Every person liable for paying the service tax shall make an application to the concerned Superintendent of Central Excise in Form ST-1 for registration within a period of thirty days from the date on which the service tax under section 66 of the Finance Act, 1994(32 of 1994) is levied:

Provided that where a person commences the business of providing a taxable service after such service has been levied, he shall make an application for registration within a period of thirty days from the date of such commencement. (Refer section 69 of Finance Act, 1994 & Rule 4 of the Service Tax Rules, 1994)

Also, the following two categories of persons have been identified as ‘Special Category of Persons’ under The Service Tax (Registration of Special Category of Persons) Rules, 2005:

·         Input Service Distributor;

·         Any provider of taxable service whose ‘aggregate value of taxable service’ (‘aggregate value’ has been defined in Rule 2(b) of The Service Tax (Registration of Special Category of Persons) Rules, 2005) in a financial year exceeds ten lakh rupees.

Steps & Procedure for Registration:

1.    The assessee shall make an application in form ST 1 to the Superintendent of Central Excise in duplicate. Such application can be filed online www.aces.gov.in. For this the following procedure shall be adhered to:

·         The user shall first log onto the website ACES and select “Service Tax” option on the left side of the screen

·         He shall then register himself by clicking on “New users to click here to register with ACES” option. On clicking the same he will be required to give certain basic details and a e-mail id. The password for such registration will be sent to this mail id.

·         On submitting the form the password will be sent to the ID above and the user shall login into ACES with this password. Such a password is only to gain access to ACES and it does not imply that registration with the department is done.

·         In the case of an existing assessee, he shall fill in the “Declaration Form for ACES” (in Appendix I) and submit it to the respective commissionerate. The assessee will then receive a user ID and password at the mail ID specified in such form to activate his registration number in ACES. An existing assessee is NOT required to fill Form ST-1 again in ACES.

·         For a new assessee who does not have a service tax registration certificate, shall register with ACES with the ID and password that is sent as mentioned in the third point and select the option “REG” and “Fill ST-1”.

·         The form shall be filed online with all the required details and submitted online itself.

·         A print of the form submitted online shall be taken and along with this the documents as mentioned in 5 below shall be submitted to the department at the concerned commissionerate.

2.    The application shall be filed within 30 days from the date of providing taxable service and shall bear the address sought to be registered

3.    The application should be filled up carefully without errors and columns and boxes which are not applicable may contain “NA” stated across them. All the taxable services provided should be mentioned on the application and there would not be separate applications for each of such taxable services

4.    The Form should be signed by the director/partner/sole proprietor as the case may be or the authorized signatory.

5.    The application shall be accompanied by copies of the following documents -

·         Self certified copy of PAN, (where allotment is pending, copy of the application for PAN may be given)

·         Copy of MOA/AOA in case of Companies

·         Copy of Board Resolution in case of Companies

·         Copy of Lease deed/Rental agreement of the premises

·         A brief technical write up on the services provided

·         Registration certificate of Partnership firm

·    Copy of a valid Power of Attorney where the owner/MD/Managing Partner does not file the application

6.    Once filed, the acknowledgement for having filed the application is to be obtained on the duplicate copy for one’s own reference

7.    If the Particulars stated in the Form are correct, then the registration certificate would be provided within a period of seven days. Where not so provided, the registration is deemed to have been granted.

Centralized registration:

Centralised registration is opted for in a case where the accounting and billing operations of the assessee are centralized in an administrative office which may be a branch or Head Office despite the services being provided from more than one location. The premises that is registered here is the one where the centralized accounting and billing is done. This decision is at the option of the tax payer and he can also opt to have multiple registration which however may not be advisable. The procedure would be the same as explained above with a few exceptions:

1.    The registration in case of centralized registration would be granted by the Commissioner of Central Excise having jurisdiction over the centralized premises

2.    The registration formality at the department’s end takes a little longer than the period stated above and the concept of deemed registration need not apply here.

The following documents are required in addition to the documents needed under the aforesaid procedure -

·       Proof of address of each such premises or branches for which centralized registration is sought

·       Proof of address of branches, new offices opened if any

Procedure of Registration under Excise Act

Procedure of Registration under Excise Act,

Persons liable to register:

In accordance with Rule 9 of Central Excise Rules, 2002, below mentioned persons are required to obtain excise registration:

• Every manufacturer of dutiable goods;
•  First and second stage dealers desiring to issue Cenvatable invoices;
• Persons holding warehouses for storing non‐duty paid goods.

 Procedure for registration ‐ Aces Registration:

New registrants are required to follow the below mentioned procedure as to be displayed on the portal of ACES website during registration procedure:

• Log on to ACES website and register accordingly by following the hyperlink “Click Here to Register with ACES”
• After entering the requisite details, click on ‘Submit’ button to get the response scree
• An acknowledgement is generated, which confirms that password has been delivered to the email address of the user which indicates that the user can now login as a normal user using his credentials
• Login with username and password
• Change password
• Click on “REG” tab and click on “Fill A ‐ 1” from the drop down list
• Fill the form with desired details
• Proceed by clicking “Save & Continue”
• Duly filled A ‐ 1 would be generated, giving the option to make any changes by way of “Modify” tab
• Print the duly filled/modified form
•  Click on “Submit”
•  Print the acknowledgement generated consequently
• Submit the printed form and printed acknowledgement along with requisite documents (self attested) to the excise authorities
• Obtain registration certificate

Documents required for registration (self attested copies):

• PAN card copy of the company/firm
• PAN card copy of authorized signatory
• Ground plan of factory (which should also provide description of boundaries of premises to be registered)
• List of directors/partners
• Memorandum and Articles of Association/Partnership deed
• General power of attorney (in case application is signed by authorized agent)

 Apart from these, department may also require certain additional documents, some of which are mentioned hereunder:

•  PAN card copy of directors/partners other than signatories;
• Address proofs of the factory premises like:

1.       Copy of purchase agreement along with electricity bill, water bill etc., if factory is owned;
2.       Copy of Leave and license agreement along with electricity bill, water bill etc., if factory is taken on lease;
3.       ‘No objection certificate’ from the licensor and last paid rent receipt may also be required

• Residence proof of directors/partners
• Registration Certificate under any other laws, if any

Penalty for failure to get registered:

If the manufacturer or producer who is required to take registration fails to apply for registration, a penalty up to duty of contravening goods or Rs 10,000, whichever is higher, can be imposed and contravening goods can be confiscated. Moreover, imprisonment up to 7 years (minimum 6 months) can be imposed (Rule 25 of Central Excise Rules, 2002 and Section 9 of The Central Excise Act, 1944)