Conclusions & Suggestions:

The Words are used quite often during my summer project that is Tax Planning. Tax Planning means a) taking advantage of the legitimate concessions and exemptions provided in the tax law and thus reducing the tax liability. b) arranging business operations such that tax liability is reduced i.e when two methods is possible to achieve an objective, select one which results in lower tax liability. An assessee should take following precautions while deciding any tax planning idea. (a) Disclose All Material Facts- Normally a demand of duty can be raised for a period of six months prior to show cause notice. However, this period can be increased to five years in case of fraud, collusion, suppression of facts or willful misstatement. Thus, all relevant facts must be disclosed. An unexpected huge demand for past five-year period may be disastrous for the assessee. (b) Discuss with Excise Authorities & Experts- A plan of assessee can be discussed with excise authorities and experts and he need not be over confident in these matters. (c) Study Product & Pricing Policies An assessee need to study the product and pricing policies thoroughly and ensure that these are so designed that unnecessarily heavy duty is not paid. (d) Interest on Late Payment Interest is payable for late payments. Thus, if payment is delayed by filing appeal etc. and so designed that unnecessarily heavy duty is not paid. (e) Heavy Penalty for Tax Avoidance An assessee should remember that wrongful availing Cenvat or contravening any provision of excise rules with intent to evade duty is offence and penalty can be very heavy. Hence, in case of doubt, it may be advisable to make payment of duty under protest and claim refund. However in such cases, it must be ensured that only lower duty is charged to buyers. The extra duty should not be recovered from customers. Otherwise, even if refund claim is sanctioned later, one will not get the amount. 51

Bibliography
www.taxmann.com www.taxindiaonline.com www.dateyvs.com Books Preferred: Indirect Taxes Law & Practice Sanjeev Kumar Indirect Taxes Law & Practice Yogendra Bangar & Vandana Bangar Indirect Taxes Law & Practice V.S. Datey.