Thursday, 26 February 2015

PUNJAB CHEMICAL WORKS RULES

GOVERMENT OF THE PUNJAB
EXCISE AND TAXATION DEPARTMENT
THE PUNJAB CHEMICAL WORKS RULES
[12th January 1933]
NOTIFICATION
NO. 2000-2001-1955-(C)/Ex(P)III.   In exercise of the powers conferred by Section 59 of the Punjab Excise Act. 1914 (1 of 1914), read with Government of the Punjab, Excise and Taxation Department’s Notification No. 52-75/26-Ex.III, dated January 7, 1975, the Excise Commissioner, Punjab is pleased to amend the Punjab Chemical Works Rules, 1933

11.1 The words “Chemical Works” mean the premises or part of the premises approved and licensed by the Excise Commissioner for the manufacture of medicinal and other preparations containing alcohol under bond and for the storage of alcohol and finished preparations containing alcohol on which duty has yet to be paid. The instructions for the management of distilleries published in the Punjab Distillery Rules, contained in Chapter 9 of this volume, shall apply to Chemical Works in such of their details as are not provided for in the following rules and to such extent as the Excise Commissioner may from time to time direct.
11.2 “Spirit Store” means that part of  the Chemical Works which is set apart for the storage of rectified spirit.
11.3 “Laboratory” means that part of the Chemical Works in which the actual manufacture of medicinal and other preparations containing rectified spirit takes place.
11.4 “Warehouse” means that part of the Chemical Works in which finished preparations containing rectified spirit, on which duty has not yet been paid, are stored.
11.5     “Rectified spirit” means spirit of the strength of 43 degrees or more over proof.
11.6 “Officer in charge” means an officer of the Excise Department deputed to supervise excise work in the Chemical Works.
11.7 “Approved Manufacturer” means a person to whom a license has been granted in Form M.C 12 for the manufacture of medicinal and other preparations in bond.
Section B Licenses and Licensed Premises.
11.8 Any person desiring to use rectified spirit of Pakistan manufacture for the manufacture of medicinal and other preparations under bond must apply in writing to the Collector of the district giving the following particulars:-
(a)             name or names and addresses of the applicant;
(b)             the situation of the Chemical Works;
(c)              the maximum quantity of proof spirit likely to be in stock at any one time on the licensed premises;
(d)             the amount of security which the applicant is prepared to furnish as a guarantee for the performance of the conditions under which the privilege is granted; and
(e)             a correct plan of the buildings to be used. The plan shall be submitted in duplicate, drawn to scale on tracing cloth, showing the plan and elevation of the premises and the position of the spirit store, laboratory and warehouse and the exact position and dimensions of all permanent vessels for the storage of rectified spirit or medicinal or other preparations and of all compounding tables, almirahs, safes, sinks and all important details connected with the Chemical Works or with the vessels in it.
11.9         In case the application is granted no further alterations will be made in the building or plant without the previous sanction of the Director, Excise and Taxation.
11.10      The application shall, be forwarded by the Collector for the consideration of the Excise Commissioner, who if he accepts the application, will fix the nature and amount of security which each applicant (subsequently refereed to as the approved manufacturer) will be required to give for the due execution of these rules and the payment of all sums chargeable against him. The Excise Commissioner may at any time require an increase in the security if the amount originally fixed should prove unsuitable.
11.11      Each application shall include for the approval of the Divisional Excise and Taxation Director.
(1)        A list of the preparation of which the manufacture is proposed under the following heads:
(a)             Medicinal preparations,
(b)             Toilet preparations, (c) Non-medicinal essences, (d) Perfumed spirit.
and if necessary under a further miscellaneous head. The Divisional Excise and Taxation Director in consultation, if necessary, with the Medical Officers of Government reserves the right to exclude any preparation or preparations from the list or to transfer preparations from one head to another.
(2)        Deleted.
11.12 A license in Form M.C 12 may be granted by the Collector for the period not exceeding one year and ending on 30th June. It may be renewed from year to year by the Collector, who may, however, on sufficient cause shown, refuse to renew it or manufacturer has furnished the security fixed may at any time determine it. The license shall not be granted unless the approved manufacturer has furnished the security fixed under rule 10 in cash, or in Government promissory notes or a Banker’s Guarantee in form M.C.14.
11.13 Sales under this license shall only be of such preparations as the Divisional Excise Taxation Director may approve and sales of medicinal preparations duty free shall only be made to such Government and charitable hospitals and dispensaries as have been approved by the Punjab Government.
11.14 The license shall be granted or renewed subject to the payment of [Rs. 20,000] as annual fee, which shall be payable within 15 days of the grant of the license or in case of the renewal within 15 days of the  commencement of the financial year for which the renewal is sought.
11.15 If the approved manufacturer goes out of business, he shall dispose of his stock of rectified spirit and un-issued preparations in such manner as the Director, Excise and Taxation may direct. 11.16 The approved manufacturer shall not transfer or divide his interest in the business without the previous permission of the Excise Commissioner.
11.17 The Chemical Works shall, at all times be open to inspection by authorized Government servants who may take any necessary samples for analysis.
11.18 The cost or a portion of the cost of the Excise staff required for supervision may be charged to the approved manufacturer, as the Excise Commissioner may direct.
11.19 Work in the Chemical Works shall only be carried on during such hours as may be fixed by the Director, Excise and Taxation. The works shall only be opened in the presence of the officer in charge, appointed to supervise the work there.
11.20 Only the approved manufacturer or his Manager and such servants, as are required to be there, shall enter the Chemical Works. The approved manufacturer shall furnish to the officer in charge a list containing the names of the Manager, or Assistant Manager employed by him and of all the employees whose duties require them to enter the Chemical Works. He should inform the officer-in charge of any changes which are to be made in the list. The officer in charge shall forward a copy of such list to the Collector.
11.21 If the licensee from any cause, physical or mental, becomes incapable of carrying on business, or dies, or becomes insolvent, or (in the case of a company) is wound up, the Collector may either (1) cancel the license or (2) continue it in the name of the legal representative of the licensee. Neither the licensee nor any other person shall be entitled to any compensation or damages whatsoever in respect of the revocation, cancellation, or determination of the license.
Section.
Manufacture.
11.22 No preparation, other than those previously approved by the Excise Commissioner shall be manufactured under these rules.
11.23 Rectified spirit and absolute alcohol, obtained or prepared under these rules, shall not be sold to public or trade provided that transfers from one Chemical Works to another may be made with the special sanction of the Excise Commissioner.
11.24 Rectified spirit may be obtained in bond without pre-payment of duty from any distillery in the Punjab or elsewhere in quantities not less than 10 gallons at a time, under a permit issued by the Collector of the district of destination. In any case, however the quantity in the possession of the approved manufacturer shall not exceed a limit fixed by the Excise Commissioner and an unnecessarily large stock of spirit shall not be carried by the approved manufacturer.
11.25 Immediately on receipt of the consignment, the officer in charge shall enter in ink upon the pass the bulk gallons, strength and proof gallons found by him after gauging and proving as well as the transit wastage in proof gallons for each vessel. The passes shall be retained along with other accounts and kept in a special book file. The Excise Commissioner after considering the monthly return furnished under rule 11.44, may call upon the approved manufacturer to pay duty at such rate not exceeding the tariff rate, as he thinks fit on the whole or any part of the wastage which may appear excessive or due to theft or fraud.
11.26 Rectified spirit shall be emptied forthwith into locked vessels in the spirit store of the
Chemical Works. Each such vessel shall be fixed and gauged and shall be marked with words “Rectified spirit……. Store Vessel” the capacity of the vessel and a distinctive number. Tables shall be compiled to show the contents of each inch and tenth of an inch of its depth in register Form D-6. Excise ticketed locks shall be placed on the man door and discharge cocks of such vessels. The officer in charge must take the dip in each store vessel once every time the spirit is issued as a check on loss or abstraction. The dip thus taken must be entered in the diary in Form D-9 and the prescribed account in Form M.C.I.
11.27 The charging and discharging pipes of spirit store vats, and all vessels used for the store of spirit, all mandoors of such vats or vessels, and the doors of sprit store, laboratory and the warehouse shall be so fitted as to enable them to be closed with two locks, the keys for which are not interchangeable, and of which one lock shall be a Revenue lock (ticketed) in charge of the officer incharge and the other a lock in charge of the approved manufacturer. The keys of all the revenue locks shall be kept by the officer in charge in whose absence no door or vessel in the Chemical Works may be unlocked or remain unlocked.
11.28 Any distilling or converting apparatus which may be erected shall be locked with ticketed locks, and the reservoirs, trap vessels, worms etc, in which potable spirit may be contained or received shall be so constructed as to prevent abstraction of spirit before the officer in charge has taken an account of it.
11.29 No spirit shall be removed from any store vessel until an account of the quantity and strength has been taken by the officer in charge.
11.30 Whenever any preparation is to be manufactured, the spirit required for such preparation shall be obtained from the spirit store for the manufacture of particular preparations. The spirit thus obtained shall be added without delay in the presence of the officer in charge to the respective materials to be treated; and to every percolator or other vessel in which the spirit is placed, there shall be attached a label in form M.C 8 showing the description of the preparation, the date with the quantity and strength of all spirit placed in it from time to time and the date on which any of the finished products were removed to stock with the quantity so removed.
11.31 Spirit recovered from residues shall be either:-
(a)             transferred to a gauged and locked vessel kept for the purpose and thence removed for use as required; or
(b)             used at once in continuation of the process from which it was obtained; or
(c)              destroyed in the presence of the officer in charge, who shall certify in red ink in the diary in Form D-9 its quantity and apparent strength except where the quantity exceeds one gallon, in which case the previous approval of the Excise commr. should be obtained; or
(d)             kept for use in some special way approved by the Board of Revenue.
11.32      If it is not intended to recover from the residues the contained spirit, the residues must be destroyed in the presence of the officer in charge who will record this as directed in rule 11.31.
11.33      In cases in which it is necessary to use some quantity of a finished preparation instead, of or in addition to rectified spirit, the quantity so required shall be taken from the warehouse and added in the presence of the officer in charge without delay to the materials to be treated. Such quantity shall be shown separately in columns 2, 3 and 4 of Form M.C.3 with a reference to the number of the batch from which it was taken, and on the label attached to the percolator or other vessel. It shall also be shown in Form M.C 4 the entry in column No. 8 being “used in manufacture of …” It shall however, be deducted from the monthly total of column No.10 of Form M.C 3 since the spirit contained in it is replaced in stock and is not shown as issued in Form M.C.7.
11.34      (1) The finished preparations shall be kept separate from those in the course of preparation and be stored in a separate store room approved for the storage of finished preparations, called the “Warehouse”. The door of the warehouse must be fastened with Excise ticketed locks. The words “warehouse for bonded medicinal and other preparations” must be painted on the door in which these preparations are allowed to be stored. Similarly the words “Spirit Store” and “Laboratory” shall be painted on the doors of the rooms set apart as such.
(2)        Finished preparations may be stored:-
(a)             in bulk, in jars or bottles containing not less than one quart (40 fluid ounces), or
(b)             stored ready for issue in bottles of not less than two fluid ounces capacity, every bottle containing not less than 2 fluid ounces of a preparation.
(3)             Every preparation stored in bulk must be measured to the storage vessels to the nearest fluid ounce by the officer in charge who must them close and seal the vessel with his official seal.
(4)             The description, quantity and true strength of the preparation must then be recorded on a label in Form M.C 8, by the approved manufacturer or his agent and each label must also bear the distinctive serial number corresponding with the number entered in the prescribed register (Form M.C.3)
(5)             In the case of preparations stored in bulk the label on every vessel must be signed and dated by the officer incharge.
(6)             When any of the contents of a vessel refereed to in clause (2) (a) has been removed, the officer in charge must enter on the label attached thereto the quantity taken out and the manner of disposal with his signature and date. Finished preparations shall only be removed from the warehouse in accordance with an application in Form M.C 6. The approved manufacturer must state in Form M.C 6 the number of bottles or jars in which each preparation is contained and the bulk quantity to be removed.
(7)             Sub-rule (4) must be followed in respect of preparations referred to in sub-rule (2) (b), but the contents of bottles are to be checked at the time of issue according to the following scale:-
Whenever the number of bottles in any consignment does not exceed 100, the officer in charge is to measure one in every 25 and fraction of 25 to 50 and one in any remaining number upto 100. When the number exceeds 100, three bottles are to be measured in the first 100 one in every 50 and fraction of 50. A larger proportion should be measured, should the officer in charge consider it necessary. The Officer n charge must certify in Form M.C.6 the number of bottles issued and how many were checked measurement. Only standard gallon measures and graduated glass measures, approved by the Excise Commr. are to be used in gauging preparations.
11.35 Samples of any finished preparation may at the time of its removal to the warehouse be taken for despatch to the Chemical Examiner for analysis and test of the amount proof  spirit contained therein. Not less than ten percent of the preparations issued from the Chemical Works in the month should thus be sampled. The Officer in charge is responsible for ensuring that not less than this percentage of issue is sampled monthly. The following procedure shall be observed in sampling the preparations:-
(1)             A sample shall not be less than 3 fluid ounces.
(2)             Every sample must be taken in duplicate personally by the Officer in charge. The cork of every bottle must be sealed by him with a revenue seal and the name of every preparation must be stated on a label affixed to each bottle. The duplicate samples should be kept under Excise lock until the result of analysis has been reported, unless specially asked for by the Chemical Examiner to replace the original samples or to repeat an analysis. Duplicate samples to which no further reference can be needed may be returned to the approved manufacture.
(3)             The samples must be placed in a case and securely fastened with tape or wire provided by the approved manufacturer and be sealed by the officer in charge with a revenue seal and delivered without delay at the expense of the approved manufacturer to the Chemical Examiner.
(4)             An advice letter in Form M.C 9 must be dispatched to the Chemical Examiner at the same time.
11.36      The approved manufacturer must submit, if required, samples of all or any of his medicinal preparations to such medical officer as Government may designate for test, and must agree to abide by any rules drawn up by the medical Officers of Government authorized in this behalf with a view to ensuring the efficacy and purity of the medicinal preparations produced in the Chemical Works
11.37      At the time of issue the approved manufacturer shall declare the strength of the finished preparations and all calculations of duty on rectified spirit contained in finished preparations  from the warehouse shall be made according to the strength declared by the approved manufacturer unless the result of the Chemical Examiner has been received before issue. If the strength of a sample actually found by the Chemical Examiner does not exceed the declared strength by three degrees, then no correction need to be made in the strength of the preparation shown in the registers, but if the actual strength exceeds the declared strength by 3 degrees or more, then the strength of the preparation as well as the quantity shown in proof gallons shall be corrected accordingly. A surcharge of duty shall be levied in the later case if any issued have been allowed from the particular before the receipt of the Chemical Examiner’s report. No refund will be allowed if the strength declared by the approved manufacturer is found higher than the actual strength reported by the Chemical Examiner. At the close of each month the officer in charge shall make a list giving the name of the preparations, number of gallons manufactured, batch number declared strength and strength found on analysis during the month in regard to which the strength found by the Chemical Examiner exceeded the declared strength by three degrees or more. The list shall be sent by the District Excise and Taxation Officer to the Director, Excise and Taxation who may impose a penalty to the extent of 10 times the shortage of duty on the quantity manufactured.
Section D------Issue of Tinctures, Extracts and  other preparations.
11.38      An account of all medicinal or other preparations received into and issued from the warehouse shall be maintained in Form M.C 4. All issues shall be made only on application by the approved manufacturer in Form M.C.6 which shall be accompanied by a treasury receipt in token of payment of the prescribed duty on the preparations concerned.
The officer in charge, after satisfying himself that the amount of duty has been paid into the treasury or has been duly accounted for, shall issue the preparation applied for and grant the transport or exports pass in Form L-46 in accordance with the provisions contained in the Punjab Liquor Import, Export, Transport and Possession Order and the Punjab Liquor Permit and Pass Rules
Provided that except in the case of samples no such transport or export pass shall be issued in the name of the approved manufacturer himself.
Provided further that the issue of manufactured drugs other than prepared opium shall be subject to the provisions of rules 18 and 19 of the Punjab Manufactured Drugs Rules, contained in Chapter 27 of this volume.
11.38      When the licensee proves to the satisfaction of the Collector that any medicinal preparation containing rectified spirit, after having been issued under a pass from the bonded warehouse, without payment of duty, on an indent signed by the Civil Surgeon or any other competent authority have been retuned to him, in full and with seals intact, the Collector shall, after such inquiry as he may consider necessary, allow the returned medicinal spirituous preparations to be taken back on the stock of the licensee. The officer incharge shall enter in the relevant registers the full particulars of the preparations taken back and the orders of the Collectors. The Officer in charge shall also maintain a separate file for such applications and orders of the Collector thereon. Details of returned preparations shall also be given in the remarks column of M.C. 11 to be submitted in accordance with rule 11.44 of these rules.
11.39      The approved manufacturer may make an advance deposit against payment of duty and issues of finished preparations may then take place so long as a sufficient balance is available. In this case the officer in charge shall keep an account in Form D-15.
11.40      All jars, bottles or other vessels and packages in which consignments are issued shall be sealed by the Officer in charge with his official seal before they leave the warehouse. Every jar, bottle, other vessel or package shall bear a label in which the following particulars shall be specified in bold English printed characters: (1) name of the approved manufacturer, (2) the place and the district as well as the province of manufacture, (3) the percentage of alcohol contained in such preparations, Medicinal and other preparations put up in small bottles should be packed in boxes containing such number of bottles that the total proof spirit content of the preparation contained in each box is not less than 0.1 proof gallon. These boxes shall be securely fastened and sealed by the Officer in charge.

Section-E. Accounts to be maintained and returns to be submitted.

11.41 The officer in charge shall maintain a diary in Form D-9 in which he shall record from  day to day all the relevant entries regarding operations  carried on in the chemical works.
11.42 The following registers shall be maintained by the approved manufacturer:(a)   M.C 2 Stock Account of Spirit used for making tinctures, etc.
(b)             M.C 3  Register of Operations in the Laboratory.
(c)              M.C 4  Stock Account of each preparation.
d) M.C 6 Application for pass for the removal of medicinal or other preparation from the Chemical Works.
(e)             M.C.8  Labels.
(f)              M.C 11 The monthly return.
11.43 The following registers shall be maintained by the Officer in charge:(a)    M.C 2 Vat Account of spirit received in the spirit store.
(b)               M.C 5 Account of spirit recovered in the Laboratory.
(c)                M.C 7 Account of finished preparations issued from the warehouse.
(d)               M.C 9 Advice of samples sent to the Chemical Examiner.
(e)               M.C 10           Account of samples sent to the Chemical Examiner.
(f)                D-6     Table book of spirit vats.
(g)               D-9     Inspector’s Diary.
(h)               D-15   Register regarding advance payment of duty.
11.44      At the end of each month the approved manufacturer shall deliver statements in form M.C.11 and in form M.C 13 in duplicate to the officer in charge who shall after verification submit them to the Collector. The Collector shall forward one copy direct to the Excise Commr. The duplicate copy being sent to the Commissioner for information. The approved manufacturer shall also furnish such true statements as may be required by the Collector in the forms prescribed under the rules.
11.45      All registers and forms of the M.C and D series shall be printed and supplied by the approved manufacturer free of charge. Forms bound together shall bear printed serial and consecutive numbers. Loose sheets of such forms as are necessary shall also be supplied to the Officer in charge.
11.46      The stock of spirit in the spirit store shall be taken by the Officer in charge on the last  working day of each month.
11.47      The stock of medicinal or other preparations containing rectified spirit in the warehouse  shall be similarly taken.
11.47-A It is found that the wastage in any chemical works is excessive or in the process of manufacture, exceeds the following scale, the Director, Excise and Taxation may after considering the monthly statement furnished under rule 11.44 call upon the approved manufacturer to pay duty at such rate, not exceeding the tariff rate, as he deems fit on the whole or any part of the wastage which may appear to be excessive or due to theft or fraud.
(1)        For medicinal preparation:Per cent (Monthly average)
(a)        Extracts and concentrated infusions made direct, by double percolation or distillation invacuo, from crude drugs such as root, bark, leaf, rhizome …………....         .40 (b) tinctures and other preparations made direct from crude drugs such as root,………         ..20 bark, leaf, rhizome, gum or resing.
©         Other tinctures and preparations…………  10 (2)    For non-medicinal preparation:-
(a)             Essencess made direct from crud drugs…  20
(b)             All other preparations………………………   05
11.48 Nothing in these rules justifies the use on a label or in an advertisement of words stating or implying that the preparation is sold under a Government guarantee as to contents or quality.
11.49 If a fire occurs in a Chemical Works, the Collector should immediately cause an enquiry to be held by a gazetted officer in order to determine the liability of the licensee to pay duty on the spirit wasted. No duty will ordinarily be assessed on spirit on which duty has not been paid; but if duty has been paid on any quantity of spirit contained in the preparations, although these have not left the Chemical Works, the Collector must satisfy himself that the spirit was really destroyed before any refund is paid. If such a refund is to be paid, it shall be calculated on the actual quantity of spirit on which duty has been paid. Once preparations have passed out of the Chemical Works no refund of duty shall be paid upon them. The previous sanction of the Excise Commr. is required before any such refund can be paid, and if either duty is to be levied or a refund is to be granted the Collector in his report should come to a clear finding whether the loss was due to preventable causes, which should have been foreseen or guarded against by the licensee.
11.50 If the approved manufacturer infringers or causes or permits any person to infringe any of the conditions enumerated above or any of the conditions of his license, the Collector may revoke and determine the license and he may forfeit to Government the whole or any part of the security deposit.
Provided that the revocation of the license or forfeiture of the security may be foregone on payment of such sum not exceeding the amount of security deposit, as the Collector may deem fit to accept.
11.51 The Excise Commr. reserves to himself the right of adding to, altering, revising or changing these rules from time to time either after or without consulting the licensee of a Chemical Works, and the licensee shall be bound by these rules and the orders and instructions issued by the Excise Commissioner under the Act or the Rules in respect of Chemical Works in general of the licensee in particular, as may be  in force for the time being.

OFFICE OF THE DIRECTOR GENERAL

EXCISE AND TAXATION

GOVERNMENT OF THE PUNJAB

DATED LAHORE THE 26th JUNE 2001
NOTIFICATION
NO. 2000-2001-1955-(C)/Ex(P)III.   In exercise of the powers conferred by Section 59 of the Punjab Excise Act. 1914 (1 of 1914), read with Government of the Punjab, Excise and Taxation Department’s Notification No. 52-75/26-Ex.III, dated January 7, 1975, the Excise
Commissioner, Punjab is pleased to amend the Punjab Chemical Works Rules, 1933 contained in Chapter 11 of the Punjab Excise Manual, Vol. II, with effect 1st day of July, 2001 as follows:-
AMENDMENT.
In Rule 11.14 the Punjab Chemical Works Rules, 1933 for the figures, “1200” the figure “10000” shall be substituted.
Sd-
Excise Commissioner / Director General
Excise and Taxation, Punjab
No. & Date Even
A copy is forwarded to:-
1                 The Superintendent, Government Printing Press, Punjab, Lahore for publication in the next extra ordinary issue of Punjab Gazette. It is requested that 200 copies of the Gazette Notification may be supplied to this Department.
2                 All administrative Secretaries to Government of the Punjab.
3                 All Heads of Attached Department in the Punjab.
4                 The Registrar, Lahore High Court, Lahore.
5                 All Commissioners of Divisions in the Punjab.
6                 All Deputy Commissioners in the Punjab.
7                 All Directors, Excise and Taxation in the Punjab.
8                 All Deputy Inspector General of Police in the Punjab.
9                 All Superintendents of the Police in the Punjab.
10              All Excise and Taxation Officers in the Punjab
Sd-
Director General, Excise and Taxation Punjab, Lahore.
Notification No.2002-2003/319-EXCISE & TAXATION(P)-I dated 30.06.2004 Excise

Commissioner/Director General, Excise & Taxation, Punjab

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