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22. Prevalence of the Act

22. Prevalence of the Act : Notwithstanding anything contained in any existing laws, the provisions of this Act shall prevail on the matters provided herein and in other matters, the existing law shall apply.

Financial Ordinance, 2059 (2003)

 

 

Financial Ordinance, 2059 (2003)
Date of Authentication and Publication
2059.9.22 (6 January 2003)
Ordinance number 8 of the year 2059
An Ordinance Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal and at the moment Parliament is not in session;
Now, therefore, be it enacted by His Majesty the King Gyanendra Bir Bikram Shah Dev has, in accordance with Articles 72 of Constitution
Kingdom of Nepal, 2047 (1990).
1. Short title and commencement : (1) This Act may be called as the “Financial Ordinance, 2059 (2003).”
(2) This ordinance shall come into force immediately.
21. Amendment to the Excise Duty Act, 2058 (2002) : Of the Excise Duty Act, 2058(2002):
(1) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty:

(1) In manufacturing or importing any goods or products set forth in the Schedule, the excise duty set forth in the Schedule shall be levied and recovered.

(2) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(3) Notwithstanding contain in Sub-section (1), there shall be furnished a bank guarantee or cash deposit
for the amount of excise duty leviable while exporting goods, to be paid excise duty from the enterprise and on any sold by duty free shop (bonded warehouse or duty free shop). The procedures for the release of such bank
guarantee or cash deposit shall be as prescribed by the Department
(2) The following Sub-section (3) shall be inserted after Sub-section
(2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be
exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum that is Twenty Five percent of that amount shall be recovered.”
(3) The following Section 25A. Shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this
Act and the Rules framed under this Act.”
(4) The following Schedule shall be inserted after Section 26:

 

 

 

Note :
(1) Less than 20 microne polithin bags are not permitted to sale or distribution inside the Nepal.
(2) The Department may interpret and specify the harmonized codes of the products.

Financial Ordinance, 2059 (2003)

 

Financial Ordinance, 2059 (2003)
Date of Authentication and Publication
2059.9.22 (6 January 2003)
Ordinance number 8 of the year 2059
An Ordinance Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal and at the moment Parliament is not in session; Now, therefore, be it enacted by His Majesty the King Gyanendra Bir Bikram Shah Dev has, in accordance with Articles 72 of Constitution
Kingdom of Nepal, 2047 (1990).
1. Short title and commencement : (1) This Act may be called as the “Financial Ordinance, 2059 (2003).”
(2) This ordinance shall come into force immediately.
21. Amendment to the Excise Duty Act, 2058 (2002) : Of the Excise Duty Act, 2058(2002):
(1) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty:

(1) In manufacturing or importing any goods or products set forth in the Schedule, the excise duty set forth in the Schedule shall be levied and recovered.
(2) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there
shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(3) Notwithstanding contain in Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while exporting goods, to be paid excise duty from the enterprise and on any sold by duty free shop (bonded warehouse or duty free shop). The procedures for the release of such bank guarantee or cash deposit shall be as prescribed by the Department
(2) The following Sub-section (3) shall be inserted after Sub-section
(2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be
exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum that is Twenty Five percent of that amount shall be recovered.”
(3) The following Section 25A. Shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this Act and the Rules framed under this Act.”
(4) The following Schedule shall be inserted after Section 26

 

 

 

Note :
(1) Less than 20 microne polithin bags are not permitted to sale or distribution inside the Nepal.
(2) The Department may interpret and specify the harmonized codes of the products

Financial Ordinance, 2060 (2003)

Financial Ordinance, 2060 (2003)
Date of Authentication and Publication
2060.3.16 (1 July 2003)
Ordinance number 3 of the year 2060
An Ordinance Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal and at the moment Parliament is not in session; Now, therefore, be it enacted by His Majesty the King Gyanendra Bir Bikram Shah Dev has, in accordance with Articles 72 of Constitution Kingdom of Nepal, 2047(1990).
1. Short title and commencement : (1) This Act may be called as the “Financial Ordinance, 2060 (2003).”
(2) This ordinance come into force immediately.
(3) This ordinance shall prevail till the last day of Ashad, 2060 B.S.
21. Amendment to the Excise Duty Act, 2058 (2002) : Of the Excise Duty Act, 2058(2002):
(1) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty: (1) In manufacturing or importing any goods or products set forth in the Schedule, the excise duty set forth in the Schedule shall be levied and recovered.
(2) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(3) Notwithstanding contain in Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while exporting goods, to be paid excise duty from the enterprise and on any sold by duty free shop (bonded warehouse or duty free shop). The procedures for the release of such bank guarantee or cash deposit shall be as prescribed by the Department
(2) The following Sub-section (3) shall be inserted after Sub-section
(2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum that is twenty five percent of that amount shall be recovered.”
(3) The following Section 25A. Shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this
Act and the Rules framed under this Act.”
(4) The following Schedule shall be inserted after Section 26:

 

 

 

Note :
(1) Less than 20 microne polithin bags are not permitted to sale or distribution inside the Nepal.
(2) The Department may interpret and specify the harmonized codes of the products.

Financial Ordinance, 2060 (2003)

Financial Ordinance, 2060 (2003)
Date of Authentication and Publication
2060.4.1(17 July 2003)
Ordinance number 7 of the year 2060
An Ordinance Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal and at the moment Parliament is not in session; Now, therefore, be it enacted by His Majesty the King Gyanendra Bir Bikram Shah Dev has, in accordance with Articles 72 of Constitution Kingdom
of Nepal, 2047(1990).
1. Short title and commencement : (1) This Act may be called as the “Financial Ordinance, 2060 (2003).”
(2) This ordinance shall come into force immediately.

23. Amendment to the Excise Duty Act, 2058 (2002) : Of the Excise Duty Act, 2058(2002):
(1) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty: (1) In manufacturing or\ importing any goods or products set forth in the Schedule, the excise duty set forth in the Schedule shall be levied and recovered. Provided that, the excise duty which used in khudo (molases) or spirit in the product of liquor may be deducted from the excise duty to be paid on exporting the ready liquor.
(2) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(2) The following Sections 3A. Shall be inserted after Section 3:

“3A. Not to levy excise duty on export from the State of Nepal:

(1) No excise duty shall be levied on goods which exported by an enterprise or on any goods sold by a bonded warehouse and duty free shop from the Nepal.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while exporting a product subject to excise duty from the enterprise. The procedures for the release of such bank guarantee or cash deposit shall be as prescribed by the Department.
(3) The following Sub-section (3) shall be inserted after Sub-section
(2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant
deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum
that is Twenty Five percent of that amount shall be recovered.”
(4) Of Section 7:
(a) The words “the price set by also adding the customs duty to the price fixed” shall be substituted for the words “the
price fixed” contained in Clause (b) of Sub-section (1).
(b) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The determination of the rate of recovery of the production of ethanol, spirit or E.N.A. required to be obtained from grains, molasses, spirit or E.N.A. to be used by an industry producing anhydrides,
ethanol, rectified spirit or E.N.A. shall be as prescribed.
(5) Where it appears that the rate of production is less than the recovery rate prescribed under Sub-section
(4), it shall be deemed that higher quality liquors have been produced from such different quantity of ethanol, rectified spirit or E.N.A.”
(5) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, such person shall be punished with a fine from Five Thousand Rupees to Fifteen Thousand Rupees according to the gravity of offence:
(a) To sell or store any product subject to excise duty without obtaining the license;
(b) To provide any service subject to excise duty without obtaining the license;
(c) To violate this Act and the Rules framed under this Act.”
(6) Of Section 23:
(a) The following Sub-section (1a) shall be inserted after Sub- section (1):
“(1a) while filing an application pursuant to Sub-section (1), one should deposit the excise duty or fine or both, as
it has been accessed or imposed as the case may be.
(b) The words “proviso” shall be deleted contained in Sub- section (3).
(7) The following Section 25A. Shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary manuals, subject to this Act and the Rules framed under this Act.”
(8) Repealed: Section 19 shall be repealed.
(9) The following Schedule shall be inserted after Section 26:

 

 

 

Note :
(1) Less than 20 microne polithin bags are not permitted to sale or distribution inside the Nepal.
(2) The Department may interpret and specify the harmonized codes of the products

Financial Ordinance, 2060 (2003)

 

Financial Ordinance, 2060 (2003)
Date of Authentication and Publication
2060.4.1(17 July 2003)
Ordinance number 7 of the year 2060
An Ordinance Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal and at the moment Parliament is not in session;
Now, therefore, be it enacted by His Majesty the King Gyanendra Bir Bikram Shah Dev has, in accordance with Articles 72 of Constitution Kingdom of Nepal, 2047 (1990).
1. Short title and commencement : (1) This Act may be called as the “Financial Ordinance, 2060 (2003).”
(2) This ordinance shall come into force immediately.

23. Amendment to the Excise Duty Act, 2058 (2002): Of the Excise Duty Act, 2058(2002):
(1) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty: (1) In manufacturing or importing any goods or products set forth in the Schedule, the excise duty set forth in the Schedule shall be levied and recovered. Provided that, the excise duty which used in khudo (molases) or spirit in the product of liquor may be deducted from the excise duty to be paid on exporting the ready liquor.
(2) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(2) The following Sections 3A. Shall be inserted after Section 3:
“3A. Not to levy excise duty on export from the State of Nepal:

(1) No excise duty shall be levied on goods which exported by an enterprise or on any goods sold by a bonded warehouse and duty free shop from Nepal.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while exporting a product subject to excise duty from the enterprise. The procedures for the release of such bank guarantee or cash deposit shall be as prescribed by the Department.
(3) The following Sub-section (3) shall be inserted after Sub-section
(2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum
that is twenty five percent of that amount shall be recovered.”
(4) Of Section 7:
(a) The words “the price set by also adding the customs duty to the price fixed” shall be substituted for the words “the price fixed” contained in Clause (b) of Sub-section (1).
(b) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The determination of the rate of recovery of the production of ethanol, spirit or E.N.A. required to
be obtained from grains, molasses, spirit or E.N.A. to be used by an industry producing anhydrides, ethanol, rectified spirit or E.N.A. shall be as prescribed.
(5) Where it appears that the rate of production is less than the recovery rate prescribed under Sub-section
(4), it shall be deemed that higher quality liquors have been produced from such different quantity of ethanol, rectified spirit or E.N.A.”
(5) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, such person shall be punished with a fine from Five Thousand Rupees to Fifteen Thousand Rupees according to the gravity of offence:
(a) To sell or store any product subject to excise duty without obtaining the license;
(b) To provide any service subject to excise duty without obtaining the license;
(c) To violate this Act and the Rules framed under this Act.”
(6) Of Section 23:
(a) The following Sub-section (1a) shall be inserted after Sub- section (1):
“(1a) while filing an application pursuant to Sub- section (1), one should deposit the excise duty or fine or both, as it has been accessed or imposed as the case may be.
(b) The words “proviso” shall be deleted contained in Sub- section (3).
(7) The following Section 25A. Shall be inserted after Section 25:

“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this
Act and the Rules framed under this Act.”
(8) Repealed : Section 19 shall be repealed.
(9) The following Schedule shall be inserted after Section 26:

 

Note :
(1) Notwithstanding anything contained above in the rate of excise duty, no excise duty shall be levied on ambulances, corpse carrying vehicles and battery tempos.
(2) Less than 20 microne polithin bags are not permitted to sale or distribution inside the Nepal

Financial Ordinance, 2061 (2004)

Financial Ordinance, 2061 (2004)
Date of Authentication and Publication
2061.4.1 (16 July 2004)
Ordinance number 3 of the year 2061
An Ordinance Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal and at the moment Parliament is not in session;
Now, therefore, be it enacted by His Majesty the King Gyanendra Bir Bikram Shah Dev has, in accordance with Articles 72 of Constitution Kingdom of Nepal, 2047(1990).
1. Short title and commencement : (1) This Act may be called as the “Financial Ordinance, 2061 (2004).”
(2) This ordinance shall come into force immediately.
23. Amendment to the Excise Duty Act, 2058 (2002): Of the Excise Duty Act, 2058(2002):
(1) The following Clause (j) shall be substituted for Clause (j) Of Section 2:
“(j) “factory price” means the price fixed by adding only the expenditure incurred in manufacturing a product subject to excise duty and the profit of the enterprise, excluding the excise duty or any other tax chargeable on such product.”
(2) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty:

(1) In manufacturing or importing any goods or products set forth in the Schedule, the excise duty set forth in the Schedule shall be levied and recovered.
(2) The excise duty paid on the raw materials used in the making of a product subject to excise duty may be deducted from the excise duty to be paid while exporting the finished product.
(3) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(3) The following Sections 3A. and 3B. Shall be inserted after Section 3:
“3A. Not to levy excise duty on export from the State of Nepal:

(1) No excise duty shall be levied on goods exported by an enterprise from Nepal.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while exporting a product subject to excise duty from the enterprise.
(3) The procedures for the release or refund of the bank guarantee or cash deposit as referred to in Sub- section (2) shall be as prescribed by the Department.
3B. Not to levy excise duty on sale by duty free shop:

(1) No excise duty shall be levied on any goods sold by a bonded warehouse and duty free shop.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while purchasing a product subject to excise duty.
(3) The procedures for the release or refund of bank guarantee or the cash deposit as referred to in Sub-section
(2) shall be as prescribed by the Department.
(4) The following Sub-section (3) shall be inserted after Sub-section
(2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum that is Twenty Five percent of that amount shall be recovered.”
(5) Of Section 7:
(a) The following Sub-clause (1) shall be substituted for Sub- clause (1) of Clause (a) Of Sub-section (1):
“(1) the price which a manufacturer determines at the time of selling a product subject to excise duty, or”
(b) The words “the price set by also adding the customs duty to the price fixed” shall be substituted for the words “the price fixed” contained in Clause (b) of Sub-section (1) .
(c) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The determination of the rate of recovery of the production of ethanol, spirit or E.N.A. required to be obtained from grains, molasses, spirit or E.N.A. to be used by an industry producing anhydrides,
ethanol, rectified spirit or E.N.A. shall be as prescribed.
(5) Where it appears that the rate of production is less than the recovery rate prescribed under Sub-section
(4), it shall be deemed that higher quality liquors have been produced from such different quantity of ethanol, rectified spirit or E.N.A.”
(6) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, such person shall be punished with a fine from Five Thousand Rupees to Fifteen Thousand Rupees according to the gravity of offence:
(a) To sell or store any product subject to excise duty without obtaining the license;
(b) To provide any service subject to excise duty without obtaining the license;
(c) To violate this Act and the Rules framed under this Act.”
(7) The words “proviso” shall be deleted contained in Sub-section
(3) of Section 23:
(8) The following Section 25A. shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this Act and the Rules framed under this Act.”
(9) Section 19 shall be repealed.
(10) The following Schedule shall be inserted after Section 26:

 

 Financial Ordinance, 2061 (2004)

Financial Ordinance, 2061 (2004)
Date of Authentication and Publication
2061.10.1(15 January 2004)
Ordinance number 22 of the year 2061
An Ordinance Made to Implement Proposals Relating to Finance of
the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal and at the moment Parliament is not in session; Now, therefore, be it enacted by His Majesty the King Gyanendra Bir Bikram Shah Dev has, in accordance with Articles 72 of Constitution
Kingdom of Nepal, 2047 (1990).
1. Short title and commencement : (1) This Act may be called as the “Financial Ordinance, 2061 (2004).”
(2) This ordinance shall come into force immediately.

23. Amendment to the Excise Duty Act, 2058 (2002): Of the Excise Duty Act, 2058(2002):
(1) The following Clause (j) shall be substituted for Clause (j) Of Section 2:
“(j) “factory price” means the price fixed by adding only the expenditure incurred in manufacturing a product subject
to excise duty and the profit of the enterprise, excluding the excise duty or any other tax chargeable on such
product.”
(2) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty: (1) In manufacturing or importing any goods or products set forth in the Schedule, the excise duty set forth in the Schedule shall be levied and recovered.
(2) The excise duty paid on the raw materials used in the making of a product subject to excise duty may be deducted from the excise duty to be paid while exporting the finished product.
(3) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(3) The following Sections 3A. and 3B. Shall be inserted after Section 3:
“3A. Not to levy excise duty on export from the State of Nepal: (1) No excise duty shall be levied on a product exported by an enterprise from the State of Nepal.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while exporting a product subject to excise duty from the enterprise.
(3) The procedures for the release or refund of the bank guarantee or cash deposit as referred to in Sub- section (2) shall be as prescribed by the Department.
3B. Not to levy excise duty on sale by duty free shop: (1) No excise duty shall be levied on any product sold by a bonded warehouse and duty free shop.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while purchasing a product subject to excise duty.
(3) The procedures for the release or refund of bank guarantee or the cash deposit as referred to in Sub-section
(2) shall be as prescribed by the Department.
(4) The following Sub-section (3) shall be inserted after Sub-section (2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant
deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum that is twenty five percent of that amount shall be recovered.”
(5) Of Section 7:
(a) The following Sub-clause (1) shall be substituted for Sub- clause (1) of Clause (a) Of Sub-section (1):
“(1) the price which a manufacturer determines at the time of selling a product subject to excise duty, or”
(b) The words “the price set by also adding the customs duty to the price fixed” shall be substituted for the words “the price fixed” contained in Clause (b) of Sub-section (1) .
(c) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The determination of the rate of recovery of the production of ethanol, spirit or E.N.A. required to be obtained from grains, molasses, spirit or E.N.A. to be used by an industry producing anhydrides, ethanol, rectified spirit or E.N.A. shall be as prescribed.
(5) Where it appears that the rate of production is less than the recovery rate prescribed under Sub-section
(4), it shall be deemed that higher quality liquors have been produced from such different quantity of ethanol, rectified spirit or E.N.A.”
(6) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, such person shall be punished with a fine from Five Thousand Rupees to Fifteen Thousand Rupees according to the gravity of offence:
(a) To sell or store any product subject to excise duty without obtaining the license;
(b) To provide any service subject to excise duty without obtaining the license;
(c) To violate this Act and the Rules framed under this Act.”
(7) The following Section 25A. shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary manuals, subject to this Act and the Rules framed under this Act.”
(8) The following Schedule shall be inserted after Section 26:

(1) Notwithstanding anything contained above in the rate of excise duty, no excise duty shall be levied on ambulances, corpse carrying vehicles and battery tempos.
(2) The Department may interpret and specify the harmonized codes of the products/

Financial Ordinance, 2062 (2005)

Financial Ordinance, 2062 (2005)
Date of Authentication and Publication
2062.4.1(16, July 2005)
Ordinance number 12 of the year 2062
An Ordinance Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal and at the moment Parliament is not in session; Now, therefore, be it enacted by His Majesty the King Gyanendra Bir Bikram Shah Dev has, in accordance with Article 72 of Constitution Kingdom of Nepal, 2047(1990).
1. Short title and commencement :

(1) This Ordinance may be called as the “Financial Ordinance, 2062 (2005).”
(2) This ordinance shall come into force immediately.

25. Amendment to the Excise Duty Act, 2058 (2002) : Of the Excise Duty Act, 2058(2002):
(1) The following Clause (j) shall be substituted for Clause (j) Of Section 2:
“(j) “factory price” means the price fixed by adding only the expenditure incurred in manufacturing a product subject
to excise duty and the profit of the enterprise, excluding the excise duty or any other tax chargeable on such product.”
(2) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty:

(1) In manufacturing or importing any goods or products set forth in the Schedule, the excise duty set forth in the Schedule shall be levied and recovered.
(2) The excise duty paid on the raw materials used in the making of a product subject to excise duty may be deducted from the excise duty to be paid while exporting the finished product.
(3) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(3) The following Sections 3A. and 3B. Shall be inserted after Section 3:
“3A. Not to levy excise duty on export from the State of Nepal:

(1) No excise duty shall be levied on a product exported by an enterprise from the State of Nepal.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while exporting a product subject to excise duty from the enterprise.
(3) The procedures for the release or refund of the bank guarantee or cash deposit as referred to in Sub- section (2) shall be as prescribed by the Department.
3B. Not to levy excise duty on sale by duty free shop:

(1) No excise duty shall be levied on any product sold by a bonded warehouse and duty free shop.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while purchasing a product subject to excise duty.
(3) The procedures for the release or refund of bank guarantee or the cash deposit as referred to in Sub-section
(2) shall be as prescribed by the Department.
(4) The following Sub-section (3) shall be inserted after Sub-section
(2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum that is Twenty Five percent of that amount shall be recovered.”
(5) Of Section 7:
(a) The following Sub-clause (1) shall be substituted for Sub- clause (1) of Clause (a) Of Sub-section (1):
“(1) the price which a manufacturer determines at the time of selling a product subject to excise duty, or”
(b) The words “the price set by also adding the customs duty to the price fixed” shall be substituted for the words “the price fixed” contained in Clause (b) of Sub-section (1) .
(c) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The determination of the rate of recovery of the production of ethanol, spirit or E.N.A. required to be obtained from grains, molasses, spirit or E.N.A. to be used by an industry producing anhydrides, ethanol, rectified spirit or E.N.A. shall be as prescribed.
(5) Where it appears that the rate of production is less than the recovery rate prescribed under Sub-section
(4), it shall be deemed that higher quality liquors have been produced from such different quantity of ethanol, rectified spirit or E.N.A.”
(6) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, such person shall be punished with a fine from five thousand rupees to fifteen thousand rupees according to the gravity of offence:
(a) To sell or store any product subject to excise duty without obtaining the license;
(b) To provide any service subject to excise duty without obtaining the license;
(c) To violate this Act and the Rules framed under this Act.”
(7) The following Section 25A. Shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this Act and the Rules framed under this Act.”
(8) The following Schedule shall be inserted after Section 26

 

 

 

 

 

Note :
(1) Notwithstanding anything contained above in the rate of excise duty, no excise duty shall be levied on ambulances, corpse carrying vehicles and battery tempos.
(2) The Department may interpret and specify the harmonized codes of the products/goods on which excise duty is leviable

Financial Ordinance, 2062 (2005)

Financial Ordinance, 2062 (2005)
Date of Authentication and Publication
2062.10.1(14 Jan. 2005)
Ordinance Number 49 of the year 2062
An Ordinance Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble: Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal and at the moment Parliament is not in session;
Now, therefore, be it enacted by His Majesty the King Gyanendra Bir Bikram Shah Dev has, in accordance with Article 72 of Constitution Kingdom of Nepal, 2047 (1990).
1. Short title and commencement : (1) This Ordinance may be called as the “Financial Ordinance, 2062 (2005).”
(2) This ordinance shall come into force immediately.

25. Amendment to the Excise Duty Act, 2058 (2002) : Of the Excise Duty Act, 2058(2002):
(1) The following Clause (j) shall be substituted for Clause (j) Of Section 2:
“(j) “factory price” means the price fixed by adding only the expenditure incurred in manufacturing a product subject to excise duty and the profit of the enterprise, excluding the excise duty or any other tax chargeable on such
product.”
(2) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty: (1) In manufacturing or importing any goods or products set forth in the Schedule or selling services set forth in the Schedule, the excise duty set forth in the Schedule shall be levied and recovered .
Provided that, the excise duty paid on the purchase or import of any product or service subject to excise duty may be deducted from the excise duty to be paid while selling such product or service.
(2) The excise duty paid on the raw materials used in the making of a product subject to excise duty may be deducted from the excise duty to be paid while exporting the finished product.
(3) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(3) The following Sections 3A. and 3B. Shall be inserted after Section 3:
“3A. Not to levy excise duty on export from the State of Nepal: (1) No excise duty shall be levied on a product
exported by an enterprise from the State of Nepal.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while exporting a product subject to excise duty from the enterprise.
(3) The procedures for the release or refund of the bank guarantee or cash deposit as referred to in Sub- section (2) shall be as prescribed by the Department.

3B. Not to levy excise duty on sale by duty free shop:

(1) No excise duty shall be levied on any product sold by a bonded warehouse and duty free shop.
(2) For the purposes of Sub-section (1), there shall be furnished a bank guarantee or cash deposit for the amount of excise duty leviable while purchasing a product subject to excise duty.
(3) The procedures for the release or refund of bank guarantee or the cash deposit as referred to in Sub-section
(2) shall be as prescribed by the Department.
(4) The following Sub-section (3) shall be inserted after Sub-section
(2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum that is Twenty Five percent of that amount shall be recovered.”
(5) Of Section 7:
(a) The following Sub-clause (1) shall be substituted for Sub-
clause (1) of Clause (a) Of Sub-section (1):
“(1) the price which a manufacturer determines at the time of selling a product subject to excise duty, or”
(b) The words “the price set by also adding the customs duty to the price fixed” shall be substituted for the words “the price fixed” contained in Clause (b) of Sub-section (1) .
(c) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The determination of the rate of recovery of the production of ethanol, spirit or E.N.A. required to be obtained from grains, molasses, spirit or E.N.A. to be used by an industry producing anhydrides, ethanol, rectified spirit or E.N.A. shall be as prescribed.
(5) Where it appears that the rate of production is less than the recovery rate prescribed under Sub-section
(4), it shall be deemed that higher quality liquors have been produced from such different quantity of ethanol, rectified spirit or E.N.A.”
(6) The following proviso shall be inserted to Clause (d) of Sub- section (3) of Section 12:
“Provided that, such suspension shall not exceed seven days; and decision shall be made no later than sixty days after the making of such suspension.”
(7) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, such person shall be punished with a fine from five thousand rupees to fifteen thousand rupees according to the gravity of offence:
(a) To sell or store any product subject to excise duty without obtaining the license;
(b) To provide any service subject to excise duty without obtaining the license;
(c) To violate this Act and the Rules framed under this Act.”
(8) The following Section 25A. shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary manuals, subject to this Act and the Rules framed under this Act.”
(9) The following Schedule shall be inserted after Section 26:

 

 

 

 

 

 

Note :
(1) Notwithstanding anything contained above in the rate of excise duty, no excise duty shall be levied on ambulances, corpse carrying vehicles and battery tempos.
(2) The Department may interpret and specify the harmonized codes of the products/goods on which excise duty is leviable.

Financial Act, 2063 (2006)

 

Financial Act, 2063 (2006)
Date of Authentication and publication
2063.7.20 (6 Nov. 2006)
Act number 12 of the year 2063 (2006)
An Act Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal; Now, therefore, be it enacted by the House of Representatives in the First Year of the issuance of the Proclamation of the House of Representatives, 2063 (2006).
1. Short title and commencement :

(1) This Act may be called as the “Financial Act, 2063 (2006).”
(2) Sections 1, 2, 3, 4, 5, 9 and 18 of this Act shall be deemed to have come into force on 28 Ashad 2063 (12 July 2006) and the other Sections on 1 Shrawan 2063 (17 July 2006).
29. Amendment to the Excise Duty Act, 2058 (2002) : Of the Excise Duty Act, 2058 (2002):
(1) Of Section 2:
(a) The following Clause (j) shall be substituted for Clause (j):
“(j) “factory price” means the price fixed by adding only the expenditure incurred in manufacturing a product subject to production cost and the profit of the enterprise, excluding the excise duty or any other tax chargeable on such product.”
(b) The following Clause (g) shall be substituted for Clause
(g):
“(g) “Production” means the manufacturing, making or preparing a product subject to excise duty, and this expression also includes re-packaging.”
(c) The following Clause (h1) shall be inserted after Clause
(h):
“(h1) “Tobacco product” means tobacco or cigarette containing mixtures of tobacco substance, pan parag, khaini or similar substance which is chewed or put in mouth and this expression also includes bidi, cigar etc.”
(d) The following Clauses (q), (r), (s), (t), (u) and (v) shall be inserted after Clause (p):
(q) “liquors” means any alcoholic substance prepared by fermenting any grains, fruits or any other stratchful substance or by other method, which has an alcoholic strength by volume of more than o.5 percent, and this expression includes liquors, spirit, country liquor (chhang), whisky, rum, gin, brandy, vodka, beer, wine, sherry, cider, perry, mid, malt, industrial alcohol, rectified spirit, ENA and heads spirit.
(r) “ready-made liquors” means all kinds of alcoholic fluids prepared from mixtures with alcoholic strength by volume of less than 57.38 percent.
(s) “L.P. means the strength of pure ethanol in London proof.
(t) “L.P. liter” means the volume of 57.38 percent pure ethanol per liter.
(u) “U.P.” means the strength less than London proof.
(v) “O.P.” means the strength more than London proof
(2) The following Section 3 shall be substituted for Section 3:

“3. To levy and collect excise duty:

(1) In manufacturing or producing and discharging from any enterprise, importing any goods or products set forth in the Schedule or selling any such goods or products imported or selling services, the excise duty set forth in the Schedule shall be levied and collected as follows:
(a) In the case of liquors, cigarette and beer, at the time of production and discharge from the enterprise;
(b) In the case of any product or service to be sold under the automatic discharge system, the excise duty shall be paid within the seventh day of the month following the production or sale; Provided that, the excise duty paid on the purchase or import of any product or service subject to excise duty may be deducted from the excise duty to be paid while selling such product or service.
(2) The excise duty paid on the raw materials used in the making of a product subject to excise duty may be deducted from the excise duty to be paid while exporting the finished product.
(3) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(3) The following Sections 3A., 3B. and 3C. shall be inserted after Section 3:
“3A. Not to levy excise duty on export from the Nepal: (1) No excise duty shall be levied on a product exported by an enterprise from the State of Nepal.
(2) For the purpose of Sub-section (1), there shall be furnished a cash deposit or bank guarantee for the amount of excise duty leviable while exporting a product subject to excise duty from the enterprise.
(3) The procedures for the release or refund of the cash deposit as referred to in Sub-section (2) shall be as prescribed by the Department.
3B. Not to levy excise duty on sale by duty free shop:

(1) No excise duty shall be levied on any product sold by a bonded warehouse and duty free shop.
(2) For the purposes of Sub-section (1), there shall be furnished a cash deposit for the amount of excise duty leviable while purchasing a product subject to excise duty.
(3) The procedures for the release or refund of the cash deposit as referred to in Sub-section (2) shall be as prescribed by the Department.
3C. Obligation to pay excise duty: The following person shall have the duty to pay the excise duty under this Act:
(a) In the case of a product or service to be produced within the country, the producer or manufacturer thereof;
(b) In the case of a product to be imported, the person receiving the product as mentioned in the bill of lading;
(c) In the case of auction of a product subject to excise duty, the person taking over that product;
(d) In the event that a duty free product is resold or used for other purpose or is converted from a condition of being exempted from excise duty into a condition of being subject to excise duty, the person who has ownership of such product.”
(4) The following Sub-section (3) shall be inserted after Sub-section
(2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be exported by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum that is Twenty Five percent of that amount shall be recovered.”
(5) Of Section 7:
(a) Of Sub-section (1):
(1) The following Sub-clause (1) shall be substituted for Sub-clause (1) of Clause (a):
“(1) the factory price which a manufacturer determines at the time of selling a product subject to excise duty, or”
(2) The following Sub-clause (1a) shall be inserted after Sub-clause (1) of Clause (a):
“(1a) In the case of service, the price of the service at the time of selling it.”
(a) The words “the price set by also adding the customs duty to the price fixed” shall be substituted for the words “the price fixed” contained in Clause (b).
(b) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The determination of the rate of recovery of the production of ethanol, spirit or E.N.A. required to be obtained from grains, molasses, spirit or E.N.A. to be used by an industry producing anhydrides, ethanol, rectified spirit or E.N.A. shall be as prescribed.
(5) Where it appears that the rate of production is less than the recovery rate prescribed under Sub-section (4), it shall be deemed that higher quality liquors have been produced from such different quantity of ethanol, rectified spirit or E.N.A.”
(6) The following proviso shall be inserted to Sub-section (2) of Section 8:
“Provided that, the excise duty license shall not be required for importing any products subject to excise duty under
the diplomatic privilege on the recommendation of the Ministry of Foreign Affairs.”
(7) The following proviso shall be inserted to Clause (d) of Sub- section (3) of Section 12:
“Provided that, such suspension shall not exceed Seven days; and decision shall be made no later than Sixty days after the making of such suspension.”
(8) The following Clauses (a), (b) and (c) shall be substituted for Clauses (a), (b) and (c) of Sub-section (1) of Section 14:
“(a) Ten per cent of the amount in controversy to the informer,
(b) Twenty per cent of the amount in controversy to one who seizes and hands over a product only;
(c) Thirty per cent of the amount in controversy to one who arrests and hands over the person, along with the proof. Provided that, in cases where the informer who gives information or clue be more than one person, the reward shall be divided between them pro rata.”
(9) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, such person shall be punished with a fine
from Five Thousand Rupees to Fifteen Thousand Rupees according to the gravity of offence:
(a) To sell or store any product subject to excise duty without obtaining the license;
(b) To provide any service subject to excise duty without obtaining the license;
(c) To violate this Act and the Rules framed under this Act.”
(10) The following Section 17A. Shall be inserted after Section 17:
“17A. Provision on payment by installment: Where any taxpayer makes a request in writing for payment of any arrear excise duty in installment, permission may be given to pay the same in installments within One year.”
(11) The following Section 19 shall be substituted for Section 19:
“19. Appeal:

(1) An appeal may lie to the Revenue Tribunal against any decision made by the Excise Duty Officer pursuant to this Act.
(2) A person who makes an appeal pursuant to Sub-section (1) shall register a copy of the appeal with the Department no later than Fifteen days of making of the appeal.
(3) The implementation of the decision set forth in Sub-section (1) of Section 16 shall not be deemed to have
been affected by the reason of making an appeal pursuant to Sub-section (1).”
(12) The following Section 23A. Shall be inserted after Section 23:
“23A. There shall be levied the excise duty on the purchase, if any, by His Majesty the King, Her Majesty the Queen, His Royal Highness the Crown Prince, and members of the royal family of any product and service subject to excise duty.”
(13) The following Section 25A. Shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this Act and the Rules framed under this Act.” (14) The following Schedule shall be inserted after Section 26:

 

 

 

 

 

 

(1) Notwithstanding anything contained above in the rate of excise duty, no excise duty shall be levied on ambulances, corpse carrying vehicles and battery tempos.
(2) The Department may interpret and specify the harmonized codes of the products/goods on which excise duty is leviable.
(3) Where one unit purchases and sells more than one type of liquors, payment of the duty at the highest rate shall suffice.
(4) Excise duty shall also be levied on the local sale for the commercial purposes of the motor vehicles mentioned in Clauses (a) to (l) of serial number 43. Provided that, no excise duty shall be levied on such local sale in the case of the motor vehicles already imported prior to the 28 th day of the month of Ashad of the year 2063. (5) The amount of excise duty on the import of a motor vehicle may be deducted from the excise duty payable on the sale of that vehicle.
(6) There shall be 25 percent exemption of per kilogram Rs. 10.00 excise duty leviable on noodles, macaroni and pasta under heading No. 1902.
(7) The raw materials M.S. wire rod in coil under sub-heading No. 7213.91.10 of heading No. 7213 to be imported by an industry shall be exempted from excise duty.
(8) A brick producer shall enjoy an exemption of Rs, 50,000.00 from the license fee payable by that producer in accordance with the Schedule of the Excise Duty Rules.
(9) The Director General may, for statistical purposes, add a digit to the eight digit sub-heading for the purposes of the rate of excise duty.

Financial Act, 2064 (2007)

 

Financial Act, 2064 (2007)
Date of Authentication and Publication
2064.3.28 (12 July, 2007)
An Act Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal; Now, therefore, be it enacted by Legislature-Parliament.
1. Short title and commencement :

(1) This Act may be called as the “Financial Act, 2064 (2007).”
(2) Sections 1, 2, 3, 4, 5, 9 and 11 of this Act shall be deemed to have come into force on 28 Ashad 2064 (11 July2007) and the other Sections on 1 Shrawan 2064 (17 July 2007).
29. Amendment to the Excise Duty Act, 2058 (2002) : Of the Excise Duty Act, 2058(2002):
(1) Of Section 2:
(a) The following clause (j) shall be substituted for clause (j):
“(j) “factory price” means the price fixed by adding only the expenditure incurred in manufacturing a product subject to production cost and the profit of the enterprise, excluding the excise duty or any other tax chargeable on such product.”
(b) The following clause (g) shall be substituted for Clause (g):
“(g) “production” means the manufacturing, making or preparing a product subject to excise duty, and this expression also includes re-packaging.”
(c) The following Clause (h1) shall be inserted after Clause
(h):
“(h1) “Tobacco product” means tobacco or cigarette containing mixtures of tobacco substance, pan parag, khaini or similar substance which is chewed or put in mouth and this expression also includes bidi, cigar etc.”
(d) The following Clauses (q), (r), (s), (t), (u) and (v) shall be inserted after Clause (k):
(q) “liquors” means any alcoholic substance prepared by fermenting any grains, fruits or any other stratchful substance or by other method, which has an alcoholic strength by volume of more than o.5 percent, and this expression includes liquors, spirit, country liquor (chhyang), whisky, rum, gin, brandy, vodka, beer, wine, sherry, cider, perry, mid, malt, industrial alcohol, rectified spirit, ENA and heads spirit.
(r) “ready-made liquors” means all kinds of alcoholic fluids prepared from mixtures with alcoholic strength by volume of less than 57.38 percent.
(s) “L.P. means the strength of pure ethanol in London proof.
(t) “L.P. liter” means the volume of 57.38 percent pure ethanol per liter.
(u) “U.P.” means the strength less than London proof.
(v) “O.P.” means the strength more than London proof.
(2) The following Section 3 shall be substituted for Section 3:
“3. To levy and collect excise duty: (1) In manufacturing or producing and discharging from any enterprise, importing any goods or products set forth in the Schedule and selling services, the excise duty set forth in the Schedule shall be levied and recovered as follows:
(a) In the case of liquors, cigarette and beer, at the time of production and discharge from the enterprise;
(b) In the case of any product to be sold after producing the goods under the automatic discharge system and In the case of any service, after issue the invoice, the excise duty shall be paid within the Twenty Fifth day of the month.
Provided that, (d) In the case of exported vehicles for commercial purpose which are leviable to excise duty and the excise duty may be levied and recovered includes in local sale.
(d) In the case of exported vehicles for commercial purpose which are leviable to excise duty, at the time of sale and issuance of invoice;
(2) The excise duty paid on the purchase or import of any product or service for commercial purpose subject to excise duty may be deducted from the excise duty to be paid while selling such product or service.
(2) The excise duty paid on the raw materials used in the making of a product subject to excise duty may be deducted from the excise duty to be paid while exporting the finished product.
(3) In the event of failure to pay the excise duty referred to in Sub-section (1) within the time limit, there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.
(3) The following Sections 3A., 3B. and 3C. shall be inserted after Section 3:
“3A. Not to levy excise duty on export from the Nepal: (1) No excise duty shall be levied on a product exported by an enterprise from the State of Nepal.
(2) For the purpose of Sub-section (1), there shall be furnished a cash deposit or bank guarantee for liquor, cigarette and beer while producing from the enterprise, subject to excise duty.
(3) The procedures for the release or refund of the cash deposit or bank guarantee as referred to in Sub- section (2) shall be as prescribed by the Department.
(4) If any goods manufactured or prepared within Nepal and already exported from Nepal are re-imported because of rejection by the concerned party or other reason, and the same goods are to be exported within Three months of the import, the goods may be released against the deposit of the excise duty leviable at the time of such return, and the deposit shall be refunded by the concerned Customs Office after the re-export of such goods.”
3B. Not to levy excise duty on sale by duty free shop:

(1) No excise duty shall be levied on any product sold by a bonded warehouse and duty free shop.
(2) For the purposes of Sub-section (1), there shall be furnished a cash deposit or bank guarantee for the amount of excise duty leviable while purchasing a product subject to excise duty.
(3) The procedures for the release or refund of the cash deposit or bank guarantee as referred to in Sub- section (2) shall be as prescribed by the Department.
3C. Obligation to pay excise duty: The following person shall have the duty to pay the excise duty under this Act:
(a) In the case of a product or service to be produced within the country, the producer or manufacturer thereof;
(b) In the case of a product to be imported, the person receiving the product as mentioned in the bill of lading;
(c) In the case of auction of a product subject to excise duty, the person taking over that product;
(d) In the event that a duty free product is resold or used for other purpose or is converted from a condition of being exempted from excise duty into a condition of being subject to excise duty, the person who has ownership of such product.”
(4) The following Sub-section (3) shall be inserted after Sub-section (2) of Section 4:
“(3) The Office may, at any time, examine the volume of alcohol and quality of liquors and other substance to be exported/produced by obtaining approval. Where the volume of alcohol is more than one percent or there is a significant deviation in the quality, the amount of controversy involved in the revenue leakage as well as additional sum that is Twenty Five percent of that amount shall be recovered.” (5) The following Section 4A. shall be inserted after Section 4 :
4A. Exemption from excise duty:

(1) In transferring any motor vehicles that were imported by any foreign mission or donor agency with the enjoyment of the diplomatic facility or tariff facility to the project itself in consonance with the approval annual program of the project and converting their number plates into governmental ones or in transferring, with the approval of the Ministry of Finance, any motor vehicles that were imported in the name of any project with the enjoyment of full or partial tariff facility (except those imported on inventory or bank guarantee) to any local body, community school, community hospital or governmental body after the completion of the project;
(2) If any diplomatic body, project or other body (governmental as well as non-governmental organization) intends to scrap and cancel the registration of any motor vehicle that it has imported with the enjoyment of the tariff facility and that is more than 15 years old after the year of initial production, with the approval of the Ministry of Finance, the excise duty shall not be levied on such a motor vehicle.
(3) If the owner of a motor vehicle imported for personal use with the enjoyment of partial customs tariff facility dies and the motor vehicle has to be transmitted to the husband or wife of the owner of motor vehicle, the excise duty shall not be levied on such a motor vehicle.
(6) Of Section 7:
(a) Of Sub-section (1):
(1) Of Clause (a),-
(a) The following Sub-clause (1) shall be substituted for Sub-clause (1):
“(1) the factory price which a manufacturer determines at the time of selling a product subject to excise duty, or”
(b) The following Sub-clause (1a) shall be inserted after Sub-clause (1):
“(1a) In the case of service, the price of the service at the time of selling it.”
(2) The words “the price set by also adding the customs duty to the price fixed” shall be substituted for the words “the price fixed” contained in Clause
(b).
(b) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The determination of the rate of recovery of the production of ethanol, spirit or E.N.A. required to be obtained from grains, molasses, spirit or E.N.A. to be used by an industry producing anhydrides, ethanol, rectified spirit or E.N.A. shall be as prescribed.
(5) Where it appears that the rate of production is less than the recovery rate prescribed under Sub-section
(4), it shall be deemed that higher quality liquors have been produced from such different quantity of ethanol, rectified spirit or E.N.A.”
(7) The following Sub-section (1) shall be substituted to Sub-section (1) of Section 8:
(1) No one shall manufacture, import, sell or store a product subject to excise duty or deliver service subject to excise duty to any other person, without obtaining the license pursuant to this Act or Rules made under this Act.
(8) The following proviso shall be inserted to Sub-section (2) of
Section 8: “Provided that, the excise duty license shall not be required for importing any products subject to excise duty under the diplomatic privilege on the recommendation of the Ministry
of Foreign Affairs.”
(9) The following proviso shall be inserted to Clause (d) of Sub- section (3) of Section 12:
“Provided that, such suspension shall not exceed seven days; and decision shall be made no later than sixty days after the making of such suspension.”
(10) The following Clauses (a), (b) and (c) shall be substituted for Clauses (a), (b) and (c) of Sub-section (1) of Section 14: “(a) Ten per cent of the amount in controversy to the informer,
(b) Twenty per cent of the amount in controversy to one who seizes and hands over a product only;
(c) Thirty per cent of the amount in controversy to one who arrests and hands over the person, along with the proof.
Provided that, in cases where the informer who gives information or clue be more than one person, the reward shall be divided between them pro rata.” (11) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, such person shall be punished with a fine from Five Thousand Rupees to Fifteen Thousand Rupees according to the gravity of offence:
(a) To sell or store any product subject to excise duty without obtaining the license;
(b) To provide any service subject to excise duty without obtaining the license;
(c) To violate this Act and the Rules framed under this Act.”
(12) The following Section 17A. Shall be inserted after Section 17:
“17A. Provision on payment by installment: Where any taxpayer makes a request in writing for payment of any
arrear excise duty in installment, permission may be given to pay the same in installments within one year.”
(13) The following Section 19 shall be substituted for Section 19:
“19. Appeal:

(1) An appeal may lie to the Revenue Tribunal against any decision made by the Excise Duty Officer pursuant to this Act.
(2) A person who makes an appeal pursuant to Sub-section (1) shall register a copy of the appeal with the Department no later than Fifteen days of making of the appeal.
(3) The implementation of the decision set forth in Sub-section (1) of Section 16 shall not be deemed to have been affected by the reason of making an appeal pursuant to Sub-section (1).”
The following Sub-section (1a) shall be inserted after Sub- section (1) of Section 23:
(1a) The taxpayer who makes an application pursuant to Sub- section (1) has to pay undisputed amount of excise duty and amount of fine, order to be recovered and furnish a cash deposit of One Third of the amount of excise duty in controversy and amount of fine.
(The following Section 23A. shall be inserted after Section 23:
“23A. To be levied the excise duty: There shall be levied the excise duty on the purchase, if any, The King, and members of the royal family of any product and service subject to excise duty.”The following Section 25A. Shall be inserted after Section 25:

“25A. Power to frame and issue manual: The Department may frame and issue necessary manuals, subject to this Act and the Rules framed under this Act.”  The word “release” shall be substituted for “export” contained in Clauses (a) and 11 of Sub-section (1) of Section 4: The word “Inland Revenue Office” shall be substituted for
“Excise Duty Office” contained in Sub-section (1) of Section 13, Sub-section (1) of Section 14 and Section 15. (19) The following Schedule shall be inserted in Excise Duty Act, 2058

 

 

(1) Notwithstanding anything contained above in the rate of excise duty, no excise duty shall be levied on ambulances, corpse carrying vehicles and battery tempos.
(2) The Department may, as required and in consultation with the Customs Department, interpret and specify the harmonized codes of the products/goods on which excise duty is leviable.
(3) The amount of excise duty on the import of a motor vehicle may be deducted from the excise duty payable on the sale of that vehicle.
(4) The raw materials M.S. wire rod in coil under sub-heading No. 7213.91.10 of heading No. 7213 to be imported by an industry shall be exempted from excise duty.
(5) The Director General may, for statistical purposes, add a digit to the eight digit sub-heading for the purposes of the rate of excise duty.
(6) No local production of marble shall be subject to excise duty

Financial Act, 2065 (2008)

 

Financial Act, 2065 (2008)
Date of Authentication and Publication
2065.6.3 (19 Nov. 2008)
An Act Made to Implement Proposals Relating to Finance of the Government of Nepal
Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal; Now, therefore, be it enacted by the Constitution Assembly pursuant to Sub-articles (1) of Article 83 of Interim Constitution of Nepal,2063 (2006).
1. Short title and commencement : (1) This Act may be called the “Financial Act, 2065 (2008).”
(2) This Act shall come into force immediately.

38. Amendment to the Excise Duty Act, 2058 (2002 ) : Of the Excise Duty Act, 2058 (2002):
(1) Of Section 2:
(a) The following clause (g) shall be substituted for clause (g):
“(g) “Production” means the act of manufacturing, making or preparing a product subject to excise duty.
(b) The following clause (h1) shall be inserted after clause
(h):
“(h1) “Tobacco product” means tobacco or cigarette containing mixtures of tobacco substance, pan parag, khaini or similar substance which is chewed or put in mouth, and this expression also includes cigarette, bidi, cigar etc.”
(c) The following clause (j) shall be substituted for clause (j):
“(j) “factory price” means the price fixed by adding only the expenditure incurred in manufacturing a product subject to excise duty and the profit of the enterprise, excluding the excise duty or any other tax chargeable on such product.”
(d) The following clauses (o1), (o2), (o3), (o4), (o5), (o6), (o7), (o8) and (o9) shall be inserted after clause (o): (ol) “liquors” means any alcoholic substance prepared by fermenting any grains, fruits or any other stratchful substance or by other method, which has an alcoholic strength by volume of more than o.5 percent, and this expression includes liqueurs, spirit, country liquor, whisky, rum, gin, brandy, vodka, beer, wine, sherry, sampan, cider, perry, mid, malt, industrial alcohol, rectified spirit, malt spirit, ENA and heads spirit. (o2) “ready-made liquors” means all kinds of alcoholic fluids prepared from mixtures with alcoholic strength by volume of less than 57.06 percent.
(o3) “L.P” means the strength of pure ethanol in London proof.
(o4) “L.P. liter” means the volume of 57.06 percent pure ethanol per liter.
(05) “U.P.” means the strength less than London proof.
(06) “O.P.” means the strength more than London proof.
(07) “Physical control system” means the system of production, release, import and export of a product subject to excise duty under the control of the Excise Duty Officer or employee designated by him or her.
(08) “Self-release system” means the system of production, release, import and export of a product subject to excise duty other than that based on the physical control system.
(09) “Determination of excise duty” means the determination of excise duty made pursuant to this Act.
(2) The following Section 3 shall be substituted for Section 3:
“3. To levy excise duty: In manufacturing or producing and discharging from any enterprise, importing any products or services subject to excise duty and selling any services, the excise duty as set forth in the Schedule shall be levied.”
(3) The following Sections 3A. and 3B. shall be inserted after Section 3:
“3A. Determination and recovery of excise duty: (1) The producer or manufacturer of goods or services subject to
excise duty shall be liable to determine and recover the excise duty under this Act. Provided that, the concerned Customs Office shall determine and recover the excise duty of the goods to be imported.
(2) If any product is subject to excise duty at the sale and distribution in addition to its production or importation, the importer or seller shall be liable to determine and recover the excise duty under this Act.
(3) The excise duty paid on the raw materials used in the making of a product subject to excise duty may be deducted from the excise duty to be paid while exporting the finished product.
(4) The excise duty paid on the purchase or import of any goods or services subject to excise duty for commercial purposes may be deducted from the excise duty payable while selling such goods or services.
(5) The excise duty paid on the goods damaged due to arson, theft, accident, disruptive act or expiration of date of goods may be deducted as specified by the Department.
3B. Not to levy excise duty:

(1) No excise duty shall be levied on any goods or services subject to excise duty pursuant to Section 3, in the following circumstances.
(a) If any goods or services are exported from Nepal or any goods other than liquors and cigarette are sold to a licensed bonded warehouse and duty free shop, on such goods or services.
Provided that, there shall be furnished a cash deposit or bank guarantee for the amount of excise duty leviable on such goods or service before selling to the duty free shop or in import.
(b) No excise duty shall be levied on the cigarette and liquors sold by the licensed bonded warehouse to any person or body enjoying diplomatic and tariff privilege, as recommended by the Government of Nepal, Ministry of Foreign Affairs. Provided that:
(1) Nothing contained herein shall bar the sale and distribution of goods by a bonded warehouse other than
cigarette and liquors, without charging excise duty.
(2) In importing any goods subject to excise duty to be sold by a bonded warehouse, there shall be furnished a
cash deposit or bank guarantee for the amount of excise duty leviable on such goods.
(2) The procedures for the release or refund of the cash deposit or bank guarantee as referred to in clause
(b) of sub-section (1) shall be as prescribed by the Department.
(3) If any goods manufactured or prepared within Nepal and already exported from Nepal are re- imported because of rejection by the concerned party or other reason, and the same goods are to be exported within Three months of the import, the goods may be released against the deposit of the excise duty leviable at the time of such return, and the deposit shall be refunded by the concerned Customs Office after the re-export of such goods.”
(4) The following Section 4 shall be substituted for Section 4:
“4. Recovery of excise duty: Except as otherwise provided in this Act, the excise duty shall be collected on the goods and services subject to excise duty pursuant to this Act as follows:
(a) In the case of goods basis on subject to the physical control system, at the time of production and discharge from the enterprise for sale;
(b) In the case of any product and service to be sold under the automatic discharge system, at the time of issue of invoice;
(c) In the case of goods to be imported, at the customs point at the time of entering of such goods into Nepal;
(d) In the case of exported vehicles for commercial purpose which are leviable to excise duty, at the time of sale and issuance of invoice;
(e) In the case of services to be imported, as prescribed by the Department.
(2) Notwithstanding anything contained in Sub- section (1), the Department may so prescribe, in the case of any goods or services, that the excise duty has to be collected at the time of production of such goods or delivery of such services.”
(5) The following Sections 4A., 4B., 4C. and 4D. shall be inserted after Section 4:
“4A. Obligation to pay excise duty: The following person shall be liable to pay the excise duty pursuant to this Act:
(a) In the case of a product or service to be produced within the country, the producer or manufacturer thereof;
(b) In the case of a product to be imported, the person receiving the product as mentioned in the bill of lading, airway bill.
(c) In the case of auction of a product subject to excise duty, the person taking over that product;
(d) In the event of resale of any goods, other than liquors and cigarette sold by a duty free shop or the use of such goods in other purpose, the person reselling or reusing them;
(e) In the event of conversion of goods from a condition of being exempted from excise duty into a condition of being subject to excise duty, the person who has ownership of such product;
(f) In the circumstances other than those set forth in Clauses (a) through (e), the person as specified by the Department.
4B. Time limit for payment of excise duty: (1) The excise duty recovered pursuant to this Act shall be paid as
follows:
(a) In the case of goods subject to the physical control system, at the time of discharge of such goods;
(b) In the case of any goods or services to be sold under the automatic discharge system, within the 25 th day of the month following the issue of invoice;
(c) In the case of goods to be imported, at the time of entering of such goods into Nepal;
(d) In the case of services to be imported, as prescribed by the Department.
(2) In the event of failure to pay the excise duty within the time limit as referred to in Clause (b) of Sub- section (1), there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.

4C. Exemption from excise duty:

(1) No excise duty shall be levied on any goods to be imported by a person or body enjoying diplomatic facility on the recommendation of the Ministry of Foreign Affairs.
(2) Notwithstanding anything contained in Sub- section (1), the excise duty shall also be exempted in the following circumstances:
(a) In transferring any motor vehicles that were imported by any foreign mission or donor agency with the enjoyment of the diplomatic facility or tariff facility to the project itself in consonance with the approval annual
programme of the project and converting their number plates into governmental ones or in transferring, with the approval of the Ministry of Finance, any motor vehicles that were imported in the name of any project with the enjoyment of full or partial tariff facility (except those imported on inventory or bank guarantee) to any local body,
community school, community hospital or governmental body after the completion of the project;
(b) If any diplomatic body (mission), project or other body (governmental as well as non- governmental organization) intends to scrap and cancel the registration of any motor vehicle that it has imported with the enjoyment of the tariff facility and that is more than Fifteen years old after the year of initial production, with the approval of the Ministry of Finance, the excise duty shall not be levied on such a motor vehicle.
(c) If the owner of a motor vehicle imported for personal use with the enjoyment of partial customs tariff facility dies and the motor vehicle has to be transmitted to the husband or wife of the owner of motor vehicle, the excise duty shall not be levied on such a motor vehicle.
4D. Control of sale and distribution: The Government of Nepal may, if it so considers necessary, control the sale and distribution of goods subject to excise duty and manage such sale and distribution as prescribed.”
(6) The following Section 7 shall be substituted for Section 7:
“7. Fixation of price of product or service subject to excise duty:

(1) In cases where the excise duty is to be levied on any product or service according to value (ad valorem), the excise duty shall be levied taking the following price as the basis
(a) The factory price which a manufacturer determines at the time of selling a product subject to excise
duty;
(b) In the case of service, the price of the service at the time of selling it; or
(c) The price specified by the Department on the basis of production/manufacturing cost.
(2) In respect of a product to be imported into Nepal, the excise duty shall be levied on the price fixed by adding the customs tariff on such a product to the price fixed for the purpose of collecting customs tariff.
(3) Excise duty on service shall be collected by fixing the price as per the invoice.
(4) For purposes of collecting excise duty, the Department may, as per necessity, re-fix the price or fix additional price.”
(7) The following Section 9 shall be substituted for Section 9:
“9. Provisions relating to license:

(1) No one shall manufacture, import, sell or store a product subject to excise duty or deliver service subject to excise duty to any other person, without obtaining the license pursuant to this Act or the Rules framed under this Act.
Provided that, no excise duty license is required to import the goods subject to excise duty under the diplomatic facility on the recommendation of the Ministry of Foreign Affairs.
(2) A person, firm, company or organization that intends to obtain the license referred to in sub-section (1) has to make an application to the Excise Duty Officer for the license, in such format and accompanied by such fee as prescribed.
(3) In cases where an application is made to the Excise Duty Officer for the license pursuant to Sub- section (2), the Department or the Excise Duty Officer designated by the Department shall issue the license in the prescribed format if it appears proper upon making necessary examination on such an application.
(4) The term of the license issued pursuant to Sub- section (3) shall remain valid until one Fiscal Year.
(5) A licensee who intends to obtain the renewal of license has to obtain the renewal within the month of Shrwan after the expiration of the period specified pursuant to Sub-section (4) by paying the fees as prescribed. Provided that, if any licensee so intends, the licensee may obtain the renewal by for three Fiscal Years by paying the renewal fees at the same time.
(6) A licensee who fails to obtain the renewal within the period as referred to in Sub-section (5) has to pay the fine of Twenty Five percent of the renewal fees for obtaining the renewal within the first Three months of the expiration of such a period, that of Fifty percent of the renewal fees for obtaining the renewal within Three months thereafter, that of Seventy Five percent of the renewal fees for obtaining the renewal within Three months thereafter and that of cent percent of the renewal fees for obtaining the renewal within the last day of the month of Ashad thereafter.
(7) If a licensee intends to obtain the renewal of license after the expiration of the period specified in Sub-
section (6), the licensee may obtain the renewal by paying the cent percent additional license fees for each Fiscal Year and due amounts, in addition to the license fees as prescribed.
(8) If any person does transaction without obtaining the license as referred to in Sub-section (1), the person shall not be exempted from the fees chargeable for the license and for its renewal.”
(8) The following Section 10. shall be substituted after Section 10:
10. Power to cancel license : The Department may cancel the license in the following circumstances:-
(a) In cases where the terms and conditions specified in the license are found violated,
(b) In cases where it appears to be contrary to public interest.
(c) Not to pay the leviable excise duty.
(9) The following Sections 10A., 10B., 10C., 10D., 10E., 10F., 10G., and 10H. shall be inserted after Section 10:
“10A. To furnish excise duty returns: A person who has obligation to determine and recover the excise pursuant to Section 3A. has to furnish the returns of transaction subject to excise duty for each month to the Excise Duty Officer or the prescribed excise duty returns by a registered post within Twenty Five days. Such returns have to be furnished irrespective of whether transaction subject to excise duty has been carried on in that month or not.

10B. To maintain accounts:

(1) A person who has obligation to furnish the excise duty returns pursuant to Section 10A. has to maintain accounts of the production and sale of goods or services subject to excise duty, of purchase, consumption of raw materials, subsidiary raw materials with specification of their price and quantity and of closing balance, along with the prescribed details, and shall provide such details as and when the Excise Duty Officer so demands for inspection.
(2) The accounts of purchase, production, release, sale and balance as referred to in Sub-section (1) shall be got certified by the concerned Excise Duty Officer and used for the purpose of maintaining accounts.
(3) The licensee has to safely retain the accounts of transaction for until Six years.
(4) For the implementation of this Act, the Excise Duty Officer may, by giving a notice in writing, seek information as to the transaction of goods and services subject to excise duty.

10C. Records processed by computer to be eligible as evidence:

(1) Notwithstanding contained in the laws in force, the records relating to excise duty of any person processed by the computer installed in the Department or offices thereunder or offices designated to administer the excise duty shall be eligible as evidence for purposes of excise duty, except as otherwise proved.
(2) The Department may so prescribe that the data relating to the goods or services subject to excise duty can be automatically retrieved by the Department or the office designated by the Department.
(3) The Department may make necessary arrangements on the submission of excise duty returns and payment of excise duty through electronic medium.”
10D. Power of Excise Duty Officer to determine excise duty:
(1) The Excise Duty Officer may determine the excise duty in any of the following circumstances:
(a) In the event of failure to submit the excise duty returns within the time limit,
(b) In the event of submission of incomplete or erroneous excise duty returns,
(c) In the event of submission of false excise duty returns,
(d) In the event of existence of a reliable ground for the Excise Duty Officer to believe that lesser amount of excise duty has been shown or the amount of excise duty is not accurate,
(e) Where there is a ground and reason for the Excise Duty Officer to believe that the sales price has been under-
invoiced and it is necessary to re- determine the price or to determine additional price pursuant to Sub- section (4) of Section 7,
(f) If the ceiling of production of goods or services subject to the excise duty is specified pursuant to or under this Act, the production ceiling is not met,
(g) If the difference between the liquors released and the alcohol content of waste material or substance if more than One percent,
(h) In the event of evasion of excise duty,
(i) If any person does transaction of goods subject to excise duty without obtaining the license. Provided that, except in the condition of Clause (c) and (h), excise duty shall be assessed within Four years from the date of submission of the details of excise duty.
(2) In determining the excise duty pursuant to Sub- section (1), the Excise Duty Officer shall give a time-limit of Fifteen days to the concerned person to defend him/herself.
(3) The Department may make monitoring of the determination of excise duty made pursuant to Sub-section
(1). If any error is found upon monitoring, the Department may order the re-determination of excise duty.
(4) The Excise Duty Officer shall have the following powers for the purposes of determination of excise duty pursuant to Sub-section (1) or examination of the excise duty returns submitted duty pursuant to Section
10A.:
(a) To examine the goods, places, documents, accounts and records related with the liability of excise
duty,
(b) To search the place of transaction of any person or other places where evidences related with the acts
deemed offence under this Act can be found,
(c) To seek information from the persons who prepare any records, books, accounts and documents or fill up
details therein in the course of discharge of their duty,
(d) To take possession of or take elsewhere any documents, books and records situated in the place of
transaction of goods and services subject to excise duty or other place related thereto,
(e) To make audit of excise duty in the place of transaction or office or other appropriate place,
(f) The Excise Duty Officer may seek information of any matter from a bank or financial institution or any person
in relation to the transaction of goods and services subject to excise duty.
(5) It shall be the duty of such a bank and financial institution or person to give information as sought by the Excise Duty Officer pursuant to this Section.

10E. Power to have expert’s service: The Department may obtain the service of liquor export, brewing expert, chemical expert and other expert, as required, for the effective implementation of this Act.

10F. Power to specify ceiling of production of goods and services subject to excise duty:

(1) The rate of production ceiling of ethanol, spirit or ENA required to be obtained from grains, molasses or Khudo used by an industry producing Anhydrous ethanol, rectified spirit or ENA shall be determined in accordance with the procedures as prescribed.
(2) If it appears that the production is less than the rate of ceiling prescribed pursuant to Sub-section (1), the production of highest quality liquors to be produced by the industry shall be deemed to have been made from the ethanol, spirit or ENA in such different quantity.
(3) The Department may specify the rate of ceiling of production of other goods and services subject to excise duty.

10G. To test the volume of alcohol: The Excise Duty Officer may at any time test or examine the content of alcohol of
he liquors discharged with approval and of the waste substance and quality thereof. The alcohol content shall not be different more than One percent or quality shall not be altered significantly.

10H. Recovery of due excise duty: If any person does not pay the excise duty to be paid within the time limit as referred to in this Act, the concerned Excise Duty Officer my recover the same by way of any or all of the following measures:
(a) Deducting the amount, if any, refundable to such a person,
(b) By having deduction of such amount from the amount payable by the Government of Nepal or any corporate body owned by the Government of Nepal or local body to such a person,
(c) By having deduction of such amount from the interest of such a person in a bank, financial institution or other institution, Explanation : For the purposes of this Clause, the term ‘interest” includes deposits and investments held in a bank, financial or other institution.
(d) By withholding the sale, export, import and other business by and of such a person,
(e) By seizing the movable and immovable property of such a person,
(f) By auction selling any or all of the movable and immovable properties of such person at one time or at different times as prescribed.
(10) The word “release” shall be substituted for the work “export” contained in Section 11.
(11) The following provision shall be inserted in Clause (d) of Sub- section (3) of Section 12: “Provided that, such suspension shall not exceed seven days; and decision shall be made no later than Sixty days after the making of such suspension.” (12) Of Section 13,
(a) The words “Inland Revenue Office” shall be substituted for the words “Excise Duty Office” contained in various places of Sub-section (1).
(b) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The Department may give an information incentive expense of a maximum of Ten Thousand Rupees as prescribed to a person who provides information of the offence as referred to in this Section.
(5) The details of the person giving information of offence pursuant to this Section shall be kept secret.”
(13) The words “Inland Revenue Office” shall be substituted for the words “Excise Duty Office” contained in various places of Sub- section (1) of Section 14 and the following Clauses (a), (b) and
(c) shall be substituted for Clauses (a), (b) and (c) of the same Sub-section:
“(a) Ten per cent of the amount in controversy to the informer,
(b) Twenty per cent of the amount in controversy to one who seizes and hands over a product only;
(c) Thirty per cent of the amount in controversy to one who arrests and hands over the person, along with the proof. Provided, however, that in cases where the informer who gives information or clue be more than one person, the reward shall be divided between them pro rata.”
(14) The words “Inland Revenue Office” shall be substituted for the words “Excise Duty Office” contained in Section 15:
(15) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, the Excise Duty Officer may punish such a person with a fine as follows:
(a) In the event of re-determination of the price or determination of additional price pursuant to Sub-section (4) of Section 7, cent percent amount of the amount of excise duty to be added,
(b) In the event of making sale or storage of goods or services subject to excise duty without obtaining the license, from Five Thousand Rupees to Fifteen Thousand Rupees.
(c) In the event of violation of the provision of Section 10A., the amount of 0.05 percent of the leviable excise duty per day or One Thousand Rupees for each return, whichever is the higher.
(d) In the event of failure to maintain updated accounts as referred to ins Sub-section (1) of Section 10B., Ten Thousand Rupees and Five Thousand Rupees for each instance in the event of no allowing the accounts of transactions to be inspected,
(e) In the event of violation of Sub-section (2) of Section 10B., upto Five Thousand Rupees,
(f) In the event of violation of Sub-section (3) of Section 10B., Ten Thousand Rupees,
(g) In the event of obstruction in the act as referred to in Sub-section (3) of Section 10D., Five Thousand Rupees for each instance,
(h) If, upon examination pursuant to Section 10G., the difference between the liquors released and the alcohol content of waste material or substance is more than One percent, cent percent of the amount of revenue leaked,
(i) If the ceiling of production of goods or services subject to the excise duty is specified and the production ceiling is not met, cent percent of the amount of excise duty to be added,
(j) In the event of violation of Section 4B., Ten Thousand Rupees for each instance,
(k) In the event of violation of this Act or the Rules framed under this Act, One Thousand Rupees for each instance.
(16) The following Section 17A. shall be inserted after Section 17:
“17A. Provision on payment by installment: Where any taxpayer makes a request in writing for the payment of any arrear excise duty by installment, permission may be given to pay the same by installment for One year.” (17) The following Section 19 shall be substituted for Section 19:
“19. Provisions relating to administrative review and appeal:

(1) A person who is not satisfied with any decision by the Excise Duty Officer of excise duty assessment and recovery thereof may make an application for administrative review to the Department against the decision within Thirty days of the date of receipt of a notice of that decision. Provided that a person may make an appeal in the Revenue Tribunal against the decision of punishment of imprisonment for any offences as referred to in Sub- sections (1), (2), (3) and (4) of Section 16. (2) In cases where the time limit for making application pursuant to Sub-section (1) expires and any person makes an application for the extension of time limit within Seven days from the date of expiration of the time limit, the Department may extend the time limit for a period not exceeding Thirty days from the date of
expiration of the time limit.
(3) If the claim of the applicant appears to be true upon examining the evidence and documents including the application made by the taxpayer pursuant to Sub-section
(1), the Director General may, by executing a memorandum setting out the clear reasons, void that excise duty assessment order and direct the concerned Excise Duty Officer to make re-assessment of excise duty.
(4) The Department shall make decision on the application within Sixty days after the date of making of application pursuant to Sub-section (1).
(5) The taxpayer who makes an application pursuant to sub-section (1) has to pay undisputed amount of excise duty and amount of fine, out of the amount of excise duty assessed, and furnish a cash deposit of One Third of the amount of excise duty in controversy and amount of fine.
(6) If the Department does not give decision within the time limit as referred to in Sub-section (4), the concerned person may appeal in the Revenue Tribunal.
(7) A person who makes an application for administrative review or an appeal pursuant to this Section shall register a copy of the application or appeal with the concerned Office no later than Fifteen days.
(8)The implementation of the decision set forth in sub-section (1) of Section 16 shall not be deemed to have
been affected by the reason of making an application for administrative review or appeal appeal pursuant to sub- section (1).”
(18) The following Section 23 shall be substituted for Section 23:
“23. Department to be responsible for implementation and administration: The Department shall be responsible for the implementation and administration of this Act.”
(19) The following Section 25A. Shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this Act and the Rules framed under this Act.”
(20) Section 8 shall be repealed.
(23) The following Schedule shall be inserted in the Excise Duty Act, 2058 (2002)

 

 

Note:

(1) Notwithstanding anything contained above in the rate of excise duty, no excise duty shall be levied on the chassis of ambulances, corpse carrying vehicles and battery tempos.
(2) The Department may, as required and in consultation with the Customs Department, interpret and specify the harmonized codes of the products/goods on which excise duty is leviable.
(3) The amount of excise duty on the import of a motor vehicle may be deducted from the excise duty payable on the sale of that vehicle.
(4) Exemption of excise duty shall be granted, on the recommendation of the Department of Industries, to the raw maters imported by industries and used to produce goods as referred to in sub-heading 7213.91.10 of heading 7213.
(5) The Director General may, for statistical purposes, add a digit to the eight digit sub-heading for the purposes of the rate of excise duty.
(6) In the event of cocktail of any liquors, the rate of tariff set forth in serial number 10 shall be applicable.
(7) No local production of marble shall be subject to excise duty.
(8) excise duty shall be levied on the goods of personal use imported enjoying the customs duty exemption facility under the Luggage and Baggage Order Facility

Financial Act, 2066 (2010)

Financial Act, 2066 (2010)
Date of Authentication and Publication
2066.3.29 (13 July 2009)
An Act Made to Implement Proposals Relating to Finance of the Government of Nepal

Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal; Now, therefore, be it enacted by the Constitution Assembly pursuant to Sub-articles (1) of Article 83 of Interim Constitution of Nepal,2063 (2007).
1. Short title and commencement : (1) This Act may be called the “Financial Act, 2067 (2010).” (2) Sections 1, 2, 3, 4, 5 and 10 of this Act shall be deemed to have come into force immediately and the other Sections on 1 Shrwan 2066(17 July 2009).

30. Amendment to the Excise Duty Act, 2058 (2002 ): Of the Excise Duty Act, 2058(2002):
(1) Of Section 2: (a) The following Clause (g) shall be substituted for Clause
(g):

“(g) “Production” means the act of manufacturing, making or preparing a product subject to excise duty.
(b) The following Clause (h1) shall be inserted after Clause
(h):

“(h1) “Tobacco product” means tobacco or cigarette containing mixtures of tobacco substance, pan parag, khaini or similar substance which is chewed or put in mouth, and this expression also includes cigarette, bidi, cigar etc.”
(c) The following Clause (j) shall be substituted for Clause (j):
“(j) “factory price” means the price fixed by adding only the expenditure incurred in manufacturing a product subject to excise duty and the profit of the enterprise, excluding the excise duty or any other tax chargeable on such product.”
(d) The following Sub-clause (3) shall be substituted for Sub- clause (3) of Clause (k):
“(3) price fixed as per Sub-section (2) of Section 7, in the case of a product to be imported.”
(e) The following Clauses (o1), (o2), (o3), (o4), (o5), (o6), (o7), (o8) and (o9) shall be inserted after Clause (o):
(ol) “liquors” means any alcoholic substance prepared by fermenting any grains, fruits or any other stratchful substance or by other method, which has an alcoholic strength by volume of more than o.5 percent, and this expression includes liqueurs, spirit, country liquor, whisky, rum, gin, brandy, vodka, beer, wine, sherry, sampan, cider, perry, mid, malt, industrial alcohol, rectified spirit, malt spirit, ENA and heads spirit.
(o2) “ready-made liquors” means all kinds of alcoholic fluids prepared from mixtures with alcoholic strength by volume of less than 57.06 percent.
(o3) “L.P” means the strength of pure ethanol in London proof.
(o4) “L.P. liter” means the volume of 57.06 percent pure ethanol per liter.
(05) “U.P.” means the strength less than London proof.
(06) “O.P.” means the strength more than London proof.
(07) “Physical control system” means the system of production, release, import and export of a product subject to excise duty under the control of the Excise Duty Officer or employee designated by him or her.
(08) “Self-release system” means the system of production, release, import and export of a product subject to excise duty other than that based on the physical control system.
(09) “Determination of excise duty” means the determination of excise duty made pursuant to this
Act.
(2) The following Section 3 shall be substituted for Section 3:
“3. To levy excise duty: In manufacturing or producing and
discharging from any enterprise, importing any products or
services subject to excise duty and selling any services, the
excise duty as set forth in the Schedule shall be levied.”
(3) The following Sections 3A. and 3B. shall be inserted after
Section 3:
“3A. Determination and recovery of excise duty:

(1) The producer or manufacturer of goods or services subject to excise duty shall be liable to determine and recover the excise duty under this Act. Provided that, the concerned Customs Office shall determine and recover the excise duty of the goods to be imported.
(2) If any product is subject to excise duty at the sale and distribution in addition to its production or importation, the importer or seller shall be liable to determine and recover the excise duty under this Act.
(3) The excise duty paid on the raw materials used in the making of a product subject to excise duty may be deducted from the excise duty to be paid while exporting the finished product. Provided that, the excise duty paid by any industry subject to the self-release system on the purchase or import of raw materials may be deducted from the excise duty payable while selling the finished product.
(4) The excise duty paid on the purchase or import of any goods or services subject to excise duty for commercial purposes may be deducted from the excise duty payable while selling such goods or services.
(5) The excise duty paid on the goods damaged due to arson, theft, accident, disruptive act or expiration of date of goods may be deducted as specified by the Department.

3B. Not to levy excise duty:

(1) No excise duty shall be levied on any goods or services subject to excise duty pursuant to Section 3, in the following circumstances.
(a) If any goods or services are exported from Nepal or any goods other than liquors and cigarette are sold to a licensed bonded warehouse and duty free shop, on such goods or services.
(b) No excise duty shall be levied on the cigarette and liquors sold by the licensed bonded warehouse to any person or body enjoying diplomatic and tariff privilege, as recommended by the Government of Nepal, Ministry of Foreign Affairs. Provided that:
(1) Nothing contained herein shall bar the sale and distribution of goods by a bonded warehouse other than cigarette and liquors, without charging excise duty.
(2) In importing any goods subject to excise duty to be sold by a bonded warehouse, there shall be furnished a cash deposit or bank guarantee for the amount of excise duty leviable on such goods.
(2) The procedures for the release or refund of the cash deposit or bank guarantee as referred to in Clause
(b) of Sub-section (1) shall be as prescribed by the Department.
(3) If any goods manufactured or prepared within Nepal and already exported from Nepal are re- imported because of rejection by the concerned party or other reason, and the same goods are to be exported within Three months of the import, the goods may be released against the deposit of the excise duty leviable at the time of such return, and the deposit shall be refunded by the concerned Customs Office after the re-export of such goods.”
(4) The following Section 4 shall be substituted for Section 4: “4. Recovery of excise duty: Except as otherwise provided in this Act, the excise duty shall be collected on the goods and services subject to excise duty pursuant to this Act as follows:
(a) In the case of goods produced by an industry subject to the physical control system, at the time of production and discharge from the enterprise for sale;
(b) In the case of any product and service to be sold under the automatic discharge system, at the time of issue of invoice;
(c) In the case of goods to be imported, at the customs point at the time of entering of such goods into Nepal;
(d) In the case of services to be imported, as
prescribed by the Department. (2) Notwithstanding anything contained in Sub-section
(1), the Department may so prescribe, in the case of any goods or services, that the excise duty has to be collected at the time of production of such goods or delivery of such services.”
(5) The following Sections 4A., 4B., 4C. and 4D. shall be inserted after Section 4:
“4A. Obligation to pay excise duty: The following person shall be liable to pay the excise duty pursuant to this Act:
(a) In the case of a product or service to be produced within the country, the producer or manufacturer
thereof;
(b) In the case of a product to be imported, the person receiving the product as mentioned in the bill of lading, airway bill.
(c) In the case of auction of a product subject to excise duty, the person taking over that product;
(d) In the event of resale of any goods, other than liquors and cigarette sold by a duty free shop or the use of such goods in other purpose, the person reselling or reusing them;
(e) In the event of conversion of goods from a condition of being exempted from excise duty into a condition of being subject to excise duty, the person who has ownership of such product;
(f) In the circumstances other than those set forth in Clauses (a) through (e), the person as specified by the Department.

4B. Time limit for payment of excise duty:

(1) The excise duty recovered pursuant to this Act shall be paid as follows:
(a) In the case of goods subject to the physical control system, at the time of discharge of such goods;
(b) In the case of any goods or services to be sold under the automatic discharge system, within the 25 th day of the month following the issue of invoice;
(c) In the case of goods to be imported, at the time of entering of such goods into Nepal;
(d) In the case of services to be imported, as prescribed by the Department.
(2) In the event of failure to pay the excise duty within the time limit as referred to in Clause (b) of Sub- section (1), there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.

4C. Exemption from excise duty:

(1) No excise duty shall be levied on any goods to be imported by a person or body enjoying diplomatic facility on the recommendation of the Ministry of Foreign Affairs.
(2) Notwithstanding anything contained in Sub- section (1), the excise duty shall also be exempted in the following circumstances:
(a) In transferring any motor vehicles that were imported by any foreign mission or donor agency with the enjoyment of the diplomatic facility or tariff facility to the project itself in consonance with the approval annual
programme of the project and converting their number plates into governmental ones or in transferring, with the approval of the Ministry of Finance, any motor vehicles that were imported in the name of any project
with the enjoyment of full or partial tariff facility (except those imported on inventory or bank guarantee) to any local body, community school, community hospital or governmental body after the completion of the project;
(b) If any diplomatic body (mission), project or other body (governmental as well as non- governmental organization) intends to scrap and cancel the registration of any motor vehicle that it has imported with the enjoyment of the tariff facility and that is more than Fifteen years old after the year of initial production, with the approval of the Ministry of Finance, the excise duty shall not be levied on such a motor vehicle.
(c) If the owner of a motor vehicle imported for personal use with the enjoyment of partial customs tariff facility dies and the motor vehicle has to be transmitted to the husband or wife of the owner of motor vehicle, the excise duty shall not be levied on such a motor vehicle.

4D. Control of sale and distribution: The Government of Nepal may, if it so considers necessary, control the sale and distribution of goods subject to excise duty and manage such sale and distribution as prescribed.”
(6) The following Section 7 shall be substituted for Section 7:
“7. Fixation of price of product or service subject to excise duty:

(1) In cases where the excise duty is to be levied on any product or service according to value (ad valorem), the excise duty shall be levied taking the following price as the basis:-
(a) The factory price which a manufacturer determines at the time of selling a product subject to excise duty;
(b) In the case of service, the price of the service at the time of selling it; or
(c) The price specified by the Department on the basis of production/ manufacturing cost.
(2) In respect of a product to be imported into Nepal, the excise duty shall be levied on the price fixed by adding the customs tariff on such a product to the price fixed for the purpose of collecting customs tariff.
(3) Excise duty on service shall be collected by fixing the price as per the invoice.
(4) For purposes of collecting excise duty, the Department may, as per necessity, re-fix the price or fix additional price.”
(7) The following Section 9 shall be substituted for Section 9:
“9. Provisions relating to license:

(1) No one shall manufacture, import, sell or store a product subject to excise duty or deliver service subject to excise duty to any other person, without obtaining the license pursuant to this Act or the Rules framed under this Act. Provided that, no excise duty license is required to manufacture, import, sell or store a product subject to excise duty or deliver service subject to excise duty by an industry subject to automatic release system, except the manufacturing of bricks, stone crusher, bidi, tobacco, khaini, pan masala, gudkha, khandsari industry and import of molasses and Gund and import of goods subject to excise duty under the diplomatic facility on the recommendation of the Ministry of Foreign Affairs.

(2) A person, firm, company or organization that intends to obtain the license referred to in Sub-section (1) has to make an application to the Excise Duty Officer for the license, in such format and accompanied by such fee as prescribed.
(3) In cases where an application is made to the Excise Duty Officer for the license pursuant to Sub- section (2), the Department or the Excise Duty Officer designated by the Department shall issue the license in the prescribed format if it appears proper upon making necessary examination on such an application.
(4) The term of the license issued pursuant to Sub- section (3) shall remain valid until one Fiscal Year.
(5) A licensee who intends to obtain the renewal of license has to obtain the renewal within the month of Shrawan after the expiration of the period specified pursuant to Sub-section (4) by paying the fees as prescribed. Provided that, if any licensee so intends, the licensee may obtain the renewal by for three Fiscal Years by paying the renewal fees at the same time.
(6) A licensee who fails to obtain the renewal within the period as referred to in Sub-section (5) has to pay the fine of Twenty Five percent of the renewal fees for obtaining the renewal within the first Three months of the expiration of such a period, that of Fifty percent of the renewal fees for obtaining the renewal within Three months thereafter, that of Seventy Five percent of the renewal fees for obtaining the renewal within Three months thereafter and that of cent percent of the renewal fees for obtaining the renewal within the last day of the month of Ashad thereafter.
(7) If a licensee intends to obtain the renewal of license after the expiration of the period specified in Sub- section (6), the licensee may obtain the renewal by paying the cent percent additional license fees for each Fiscal Year and due amounts, in addition to the license fees as prescribed.
(8) If any person does transaction without obtaining the license as referred to in Sub-section (1), the person shall not be exempted from the fees chargeable for the license and for its renewal.”
(8) The following Section 10. shall be substituted after Section 10:
10. Power to cancel license : The Department may cancel the license in the following circumstances:-
(a) In cases where the terms and conditions specified in the license are found violated,
(b) In cases where it appears to be contrary to public interest.
(c) Not to pay the leviable excise duty.
(9 ) The following Sections 10A., 10B., 10C., 10D., 10E., 10F.,
10G., 10H. and 10I shall be inserted after Section 10:
“10A. To furnish excise duty returns: A person who has obligation to determine and recover the excise pursuant to
Section 3A. has to furnish the returns of transaction subject to excise duty for each month to the Excise Duty Officer or the prescribed excise duty returns by a registered post within Twenty Five days. Such returns have to be furnished irrespective of whether transaction subject to excise duty has been carried on in that month or not.

10B. To maintain accounts:

(1) A person who has obligation to furnish the excise duty returns pursuant to Section 10A. has to maintain accounts of the production and sale of goods or services subject to excise duty, of purchase, consumption of raw materials, subsidiary raw materials with specification of their price and quantity and of closing balance, along with the prescribed details, and shall provide such details as and when the Excise Duty Officer so demands for inspection.
(2) The accounts of purchase, production, release, sale and balance as referred to in Sub-section (1) shall be got certified by the concerned Excise Duty Officer and used for the purpose of maintaining accounts.
(3) The licensee has to safely retain the accounts of transaction for until Six years.
(4) For the implementation of this Act, the Excise Duty Officer may, by giving a notice in writing, seek information as to the transaction of goods and services subject to excise duty.

10C. Records processed by computer to be eligible as evidence:

(1) Notwithstanding contained in the laws prevailing, the records relating to excise duty of any person processed by the computer installed in the Department or offices thereunder or offices designated to administer the excise duty shall be eligible as evidence for purposes of excise duty, except as otherwise proved.
(2) The Department may so prescribe that the data relating to the goods or services subject to excise duty can be automatically retrieved by the Department or the office designated by the Department.
(3) The Department may make necessary arrangements on the submission of excise duty returns and payment of excise duty through electronic medium.”

10D. Power of Excise Duty Officer to determine excise duty:
(1) The Excise Duty Officer may determine the excise duty in any of the following circumstances:
(a) In the event of failure to submit the excise duty returns within the time limit,
(b) In the event of submission of incomplete or erroneous excise duty returns,
(c) In the event of submission of false excise duty returns,
(d) In the event of existence of a reliable ground for the Excise Duty Officer to believe that lesser amount of excise
duty has been shown or the amount of excise duty is not accurate,
(e) Where there is a ground and reason for the Excise Duty Officer to believe that the sales price has been under-
invoiced and it is necessary to re- determine the price or to determine additional price pursuant to Sub-
section (4) of Section 7,
(f) If the ceiling of production of goods or services subject to the excise duty is specified pursuant to or under this
Act, the production ceiling is not met,
(g) If the difference between the liquors released and the alcohol content of waste material or substance if more
than One percent,
(h) In the event of evasion of excise duty,
(i) If any person does transaction of goods subject to excise duty without obtaining the license. Provided that, except in the condition of Clause (c) and (h), excise duty shall be assessed within Four years from the date of submission of the details of excise duty.
(2) In determining the excise duty pursuant to Sub- section (1), the Excise Duty Officer shall give a time-limit
of Fifteen days to the concerned person to defend him/herself.
(3) The Department may make monitoring of the determination of excise duty made pursuant to Sub-section
(1). If any error is found upon monitoring, the Department may order the redetermination of excise duty.
(4) The Excise Duty Officer shall have the following powers for the purposes of determination of excise duty pursuant to Sub-section (1) or examination of the excise duty returns submitted duty pursuant to Section

10A.:
(a) To examine the goods, places, documents, accounts and records related with the liability of excise duty,
(b) To search the place of transaction of any person or other places where evidences related with the acts deemed offence under this Act can be found,
(c) To seek information from the persons who prepare any records, books, accounts and documents or fill up
details therein in the course of discharge of their duty,
(d) To take possession of or take elsewhere any documents, books and records situated in the place of transaction of goods and services subject to excise duty or other place related thereto,
(e) To make audit of excise duty in the place of transaction or office or other appropriate place,
(f) The Excise Duty Officer may seek information of any matter from a bank or financial institution or any person
in relation to the transaction of goods and services subject to excise duty.
(5) It shall be the duty of such a bank and financial institution or person to give information as sought by the Excise Duty Officer pursuant to this Section.

10E. Power to have expert’s service: The Department may obtain the service of liquor export, brewing expert, chemical expert and other expert, as required, for the effective implementation of this Act.

10F. Power to specify ceiling of production of goods and services subject to excise duty:

(1) The rate of production ceiling of ethanol, spirit or ENA required to be obtained from grains, molasses or Khudo used by an industry producing Anhydrous ethanol, rectified spirit or ENA shall be determined in accordance with the procedures as prescribed.
(2) If it appears that the production is less than the rate of ceiling prescribed pursuant to Sub-section (1), the production of highest quality liquors to be produced by the industry shall be deemed to have been made from the ethanol, spirit or ENA in such different quantity.
(3) The Department may specify the rate of ceiling of production of other goods and services subject to excise duty.

10G. To test the volume of alcohol: The Excise Duty Officer may at any time test or examine the content of alcohol of
the liquors discharged with approval and of the waste substance and quality thereof. The alcohol content shall not be different more than One percent or quality shall not be altered significantly.

10H. Recovery of due excise duty: If any person does not pay the excise duty to be paid within the time limit as referred to in this Act, the concerned Excise Duty Officer my recover the same by way of any or all of the following
measures:
(g) Deducting the amount, if any, refundable to such a person,
(h) By having deduction of such amount from the amount payable by the Government of Nepal or any corporate body owned by the Government of
Nepal or local body to such a person,
(i) By having deduction of such amount from the interest of such a person in a bank, financial institution or other institution, Explanation : For the purposes of this Clause, the term ‘interest” includes deposits and investments
held in a bank, financial or other institution.
(j) By withholding the sale, export, import and other business by and of such a person,
(k) By seizing the movable and immovable property of such a person,
(l) By auction selling any or all of the movable and immovable properties of such person at one time or
at different times as prescribed.

10I. Delay fee: In the event of failure of a person to pay the excise duty within the time limit as referred to in this Act after the determination of the excise duty or for any other reason, except a circumstance as referred to in Clause (a) of Sub-section (1) of Section 4, there shall be charged a delay fee by 0.05 percent on the due and payable amount of excise duty per day.”
(10) The word “release” shall be substituted for the work “export” contained in Section 11.
(11) The following proviso shall be inserted in Clause (d) of Sub- section (3) of Section 12: “Provided that such suspension shall not exceed seven days; and decision shall be made no later than Sixty days after the making of such suspension.” (12) Of Section 13,
(a) The words “Inland Revenue Office” shall be substituted for the words “Excise Duty Office” contained in various
places of Sub-section (1).
(b) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The Department may give an information incentive expense of a maximum of Ten Thousand Rupees as prescribed to a person who provides information of the offence as referred to in this Section.
(5) The details of the person giving information of offence pursuant to this Section shall be kept secret.”
(13) The words “Inland Revenue Office” shall be substituted for the words “Excise Duty Office” contained in various places of Sub- section (1) of Section 14 and the following Clauses (a), (b) and (c) shall be substituted for Clauses (a), (b) and (c) of the same Sub-section:
“(a) Ten per cent of the amount in controversy to the informer,
(b) Twenty per cent of the amount in controversy to one who seizes and hands over a product only;
(c) Thirty per cent of the amount in controversy to one who arrests and hands over the person, along with the proof.
Provided that, in cases where the informer who gives information or clue be more than one person, the reward shall be divided between them pro rata.”
(14) The words “Inland Revenue Office” shall be substituted for the words “Excise Duty Office” contained in Section 15:
(15) Of Section 16:
(a) The following Clause (b) shall be substituted for Clause
(b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) where any person commits any of the following offences, the Excise Duty Officer may punish such a person with a fine as follows:
(l) In the event of re-determination of the price or determination of additional price pursuant to Sub-section (4) of Section 7, cent percent amount of the amount of excise duty to be added,
(m) In the event of making sale or storage of goods or services subject to excise duty without obtaining the license, from Five Thousand Rupees to Fifteen Thousand Rupees.
(n) In the event of violation of the provision of Section 10A., the amount of 0.05 percent of the leviable excise duty per day or One Thousand Rupees for each return, whichever is the higher.
(o) In the event of failure to maintain updated accounts as referred to ins Sub-section (1) of Section 10B., Ten Thousand Rupees and Five Thousand Rupees for each instance in the event of no allowing the accounts of transactions to be inspected,
(p) In the event of violation of Sub-section (2) of Section 10B., upto Five Thousand Rupees,
(q) In the event of violation of Sub-section (3) of Section 10B., Ten Thousand Rupees,
(r) In the event of obstruction in the act as referred to in Sub-section (3) of Section

10D., Five Thousand Rupees for each instance,

(s) If, upon examination pursuant to Section
10G., the difference between the liquors released and the alcohol content of waste material or substance is more than One percent, cent percent of the amount of revenue leaked,

(t) If the ceiling of production of goods or services subject to the excise duty is specified and the production ceiling is not met, cent percent of the amount of excise
duty to be added,
(u) In the event of violation of Section 4B., Ten
Thousand Rupees for each instance,
(v) In the event of violation of this Act or the Rules framed under this Act, One Thousand Rupees for each instance.
(16) The following Section 17A. shall be inserted after Section 17:
“17A. Provision on payment by installment: Where any taxpayer makes a request in writing for the payment of any arrear excise duty by installment, permission may be given to pay the same by installment for One year.”
(17) The following Section 19 shall be substituted for Section 19:
“19. Provisions relating to administrative review and appeal:

(1) A person who is not satisfied with any decision by the Excise Duty Officer of excise duty assessment and recovery thereof may make an application for administrative review to the Department against the decision within Thirty days of the date of receipt of a notice of that decision. Provided that, a person may make an appeal in the Revenue Tribunal against the decision of punishment of imprisonment for any offences as referred to in Sub- sections (1), (2), (3) and (4) of Section 16. (2) In cases where the time limit for making application pursuant to Sub-section (1) expires and any person makes an application for the extension of time limit within Seven days from the date of expiration of the time limit, the Department may extend the time limit for a period not exceeding Thirty days from the date of expiration of the time limit.
(3) If the claim of the applicant appears to be true upon examining the evidence and documents including the application made by the taxpayer pursuant to Sub-section
(1), the Director General may, by executing a memorandum setting out the clear reasons, void that excise duty assessment order and direct the concerned Excise Duty Officer to make re-assessment of excise duty.
(4) The Department shall make decision on the application within Sixty days after the date of making of application pursuant to Sub-section (1).
(5) The taxpayer who makes an application pursuant to Sub-section (1) has to pay undisputed amount of excise duty and amount of fine, out of the amount of excise duty assessed, and furnish a cash deposit of One Third of the amount of excise duty in controversy and amount of fine.
(6) If the Department does not give decision within the time limit as referred to in Sub-section (4), the concerned person may, after the expiration of that time- limit, make an appeal to the Revenue Tribunal or if the person is not satisfied with the decision made by the Department, the person may make such an appeal in the
Revenue Tribunal within Thirty Five days after the date of receipt of notice of the decision.
(7) A person who makes an application for administrative review or an appeal pursuant to this Section shall register a copy of the application or appeal with the concerned Office no later than Fifteen days.
(8) The implementation of the decision set forth in Sub-section (1) of Section 16 shall not be deemed to have been affected by the reason of making an application for administrative review or appeal pursuant to Sub-section (1).”
(18) The following Section 22A. shall be inserted after Section 22:
“22A. Deemed to be excise duty: Any charge, delay fee or fine
imposable pursuant to this Act shall be deemed to be the excise duty imposable pursuant to this Act.” (19) The following Section 23 shall be substituted for Section 23:
“23. Department to be responsible for implementation and administration: The Department shall be responsible for
the implementation and administration of this Act.”
(20) The following Section 25A. shall be inserted after Section 25:
“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this Act and the Rules framed under this Act.”
The following Schedule shall be inserted in the Excise Duty Act, 2058 (2002):

 

 

 

Note:
(1) Notwithstanding anything contained above in the rate of excise duty, no excise duty shall be levied on the chassis of ambulances, corpse carrying vehicles and battery tempos.
(2) The Department may, as required and in consultation with the Customs Department, interpret and specify the harmonized codes of the products/goods on which excise duty is leviable.
(3) The procedures of collection of the excise duty leviable on the motor vehicles purchased and in stock until Fiscal Year 2065/066 shall be as mentioned in the Finance Act, 2065.
(4) Exemption of excise duty shall be granted, on the recommendation of the Department of Industries, to the raw
maters imported by industries and used to produce goods as referred to in sub-heading 7213.91.10 of heading 72.13.
(5) The Director General may, for statistical purposes, add a digit to the eight digit sub-heading for the purposes of the rate of excise duty.
(6) In the event of cocktail of any liquors, the rate of tariff set forth in serial number 10 shall be applicable.
(7) Prepared liquors of 70 UP strength may be made by using rectified spirit of serial number 16 only.
(8) No local production of marble shall be subject to excise duty.
(9) Excise duty shall be levied on the goods of personal use imported enjoying the customs duty exemption facility under the Luggage and Baggage Order Facility.
(10) Fifteen Percent Excise duty shall be levied to the local production of motor cycles.
(11) No excise duty shall be levied on the electric motor vehicles

Financial Act, 2067 (2011)

Financial Act, 2067 (2011)
Date of Authentication and Publication
2067.11.03 (15 Feb.2011)

An Act Made to Implement Proposals Relating to Finance of the Government of Nepal

Preamble : Whereas, it is expedient to levy some charges, taxes, duties, cesses and fees, continue or alter the existing ones and also to amend the laws in force relating to revenue administration in order to implement the proposals relating to finance of the Government of Nepal; Now, therefore, be it enacted by the Constitution Assembly pursuant to Sub-articles (1) of Article 83 of Interim Constitution of Nepal,2063 (2007).
1. Short title and commencement : (1) This Act may be called the “Financial Act, 2067 (2011).”
(2) This Act shall come into force immediately.

31. Amendment to the Excise Duty Act, 2058 (2002 ) : Of the Excise Duty Act, 2058(2002):
(1) Of Section 2:
(a) The following Clause (g) shall be substituted for Clause (g):
“(g) “Production” means the act of manufacturing, making or preparing a product subject to excise duty.
(b) The following Clause (h1) shall be inserted after Clause
(h): “(h1) “Tobacco product” means tobacco or cigarette containing mixtures of tobacco substance, pan parag, khaini or similar substance which is chewed or put in mouth, and this expression also includes cigarette, bidi, cigar etc.”
(c) The following Clause (j) shall be substituted for Clause (j):
“(j) “Factory price” means the price fixed by adding only the expenditure incurred in manufacturing a product subject to excise duty and the profit of the enterprise, excluding the excise duty or any other tax chargeable on such product.”
(d) The following Sub-clause (3) shall be substituted for Sub- clause (3) of Clause (k):
“(3) Price fixed as per Sub-section (2) of Section 7, in the case of a product to be imported.”
(e) The following Clauses (o1), (o2), (o3), (o4), (o5), (o6), (o7), (o8) and (o9) shall be inserted after Clause (o): (ol) “Liquors” means any alcoholic substance prepared by fermenting any grains, fruits or any other stratchful substance or by other method, which has an alcoholic strength by volume of more than o.5 percent, and this expression includes liqueurs, spirit, country liquor, whisky, rum, gin, brandy, vodka, beer, wine, sherry, sampange, cider, perry,
mid, malt, industrial alcohol, rectified spirit, malt spirit, cylend spirit, denatured spirit, ENA and heads spirit.
(o2) “Ready-made liquors” means all kinds of alcoholic fluids prepared from mixtures with alcoholic strength by volume of less than 57.06 percent.
(o3) “L.P” means the strength of pure ethanol in London proof.
(o4) “L.P. liter” means the volume of 57.06 percent pure ethanol per liter.
(05) “U.P.” means the strength less than London proof.
(06) “O.P.” means the strength more than London proof.
(07) “Physical control system” means the system of production, release, import and export of a product subject to excise duty under the control of the Excise Duty Officer or employee designated by him or her.
(08) “Self-release system” means the system of production, release, import and export of a product subject to excise duty other than that based on the physical control system.
(09) “Determination of excise duty” means the determination of excise duty made pursuant to this Act.
(2) The following Section 3 shall be substituted for Section 3:
3. To levy excise duty: In manufacturing or producing and discharging from any enterprise, importing any products or services subject to excise duty and selling any services, the excise duty as set forth in the Schedule shall be levied.”
(3) The following Sections 3A. and 3B. shall be inserted after Section 3:

3A. Determination and recovery of excise duty:

(1) The producer or manufacturer of goods or services subject to excise duty shall be liable to determine and recover the excise duty under this Act. Provided that, the concerned Customs Office shall determine and recover the excise duty of the goods to be imported.
(2)If any product is subject to excise duty at the sale and distribution in addition to its production or importation, the importer or seller shall be liable to determine and recover the excise duty under this Act.
(3) The excise duty paid on the raw materials used in the making of a product subject to excise duty may be deducted from the excise duty to be paid while exporting the finished product. Provided that, the excise duty paid by any industry subject to the self-release system on the purchase or import of raw materials may be deducted from the excise duty payable while selling the finished product.
(4) The excise duty paid on the purchase or import of any goods or services subject to excise duty for commercial purposes may be deducted from the excise duty payable while selling such goods or services.
(5) The excise duty paid on the goods damaged due to arson, theft, accident, disruptive act or expiration of date of goods may be deducted as specified by the Department.

3B. Not to levy excise duty:

(1) No excise duty shall be levied on any goods or services subject to excise duty pursuant to Section 3, in the following circumstances.
(a) If any goods or services are exported from Nepal or any goods other than liquors and cigarette are sold to a licensed bonded warehouse and duty free shop, on such goods or services.
(b) No excise duty shall be levied on the cigarette and liquors sold by the licensed bonded warehouse to any
person or body enjoying diplomatic and tariff privilege, as recommended by the Government of Nepal, Ministry of Foreign Affairs. Provided that: (1) Nothing contained herein shall bar the sale and distribution of goods by a bonded warehouse other than cigarette and liquors, without charging excise duty.
(2) In importing any goods subject to excise duty to be sold by a bonded warehouse, there shall be furnished a cash deposit or bank guarantee for the amount of excise duty leviable on such goods.
(2) The procedures for the release or refund of the cash deposit or bank guarantee as referred to in Clause (b) of Sub-section (1) shall be as prescribed by the Department.
(3) If any goods manufactured or prepared within Nepal and already exported from Nepal are re-imported
because of rejection by the concerned party or other reason, and the same goods are to be exported within Three months of the import, the goods may be released against the deposit of the excise duty leviable at the time of such return, and the deposit shall be refunded by the concerned Customs Office after the re-export of such goods.”

(4) The following Section 4 shall be substituted for Section 4: “4. Recovery of excise duty: Except as otherwise provided in this Act, the excise duty shall be collected on the goods and services subject to excise duty pursuant to this Act as follows:
(a) In the case of goods produced by an industry subject to the physical control system, at the time of production and discharge from the enterprise for sale;
(b) In the case of any product and service to be sold under the automatic discharge system, at the time of issue of invoice;
(c) In the case of goods to be imported, at the customs point at the time of entering of such goods into Nepal;
(d) In the case of services to be imported, as prescribed by the Department.
(2) Notwithstanding anything contained in Sub-section
(1), the Department may so prescribe, in the case of any goods or services, that the excise duty has to be collected at the time of production of such goods or delivery of such services.”
(5) The following Sections 4A., 4B., 4C. and 4D. shall be inserted after Section 4:

“4A. Obligation to pay excise duty: The following person shall be liable to pay the excise duty pursuant to this Act:
(a) In the case of a product or service to be produced within the country, the producer thereof;
(b) In the case of a product to be imported, the person receiving the product as mentioned in the bill of lading, airway bill, invoice or application made for examination and clearance;
(c) In the case of auction of a product subject to excise duty, the person taking over that product;
(d) In the event of resale of any goods, other than liquors and cigarette sold by a duty free shop or the use of such goods in other purpose, the person reselling or reusing them;
(e) In the event of conversion of goods from a condition of being exempted from excise duty into a condition of being subject to excise duty, the person who has ownership of such product;
(f) In the circumstances other than those set forth in Clauses (a) through (e), the person as specified by the Department.

4B. Time limit for payment of excise duty:

(1) The excise duty recovered pursuant to this Act shall be paid as follows:
(a) In the case of goods subject to the physical control system, at the time of discharge of such goods;
(b) In the case of any goods or services to be sold under the automatic discharge system, within the 25 th day of the month following the issue of invoice;
(c) In the case of goods to be imported, at the time of entering of such goods into Nepal;
(d) In the case of services to be imported, as prescribed by the Department.
(2) In the event of failure to pay the excise duty within the time limit as referred to in Clause (b) of Sub- section (1), there shall be charged a delay fee by 0.05 percent on the due and payable amount per day.

4C. Exemption from excise duty:

(1) No excise duty shall be levied on any goods to be imported by a person or body enjoying diplomatic facility on the recommendation of the Ministry of Foreign Affairs.
(2) Notwithstanding anything contained in Sub- section (1), the excise duty shall also be exempted in the following circumstances:
(a) In transferring any motor vehicles that were imported by any foreign mission or donor agency with the enjoyment of the diplomatic facility or tariff facility to the project itself in consonance with the approval annual
programme of the project and converting their number plates into governmental ones or in transferring,
with the approval of the Ministry of Finance, any motor vehicles that were imported in the name of any project with the enjoyment of full or partial tariff facility (except those imported on inventory or bank guarantee) to any local body, community school, community hospital or governmental body after the completion of the project;
(b) If any diplomatic body (mission), project or other body (governmental as well as non-governmental
organization) intends to scrap and cancel the registration of any motor vehicle that it has imported with the
enjoyment of the tariff facility and that is more than Fifteen years old after the year of initial production,
with the approval of the Ministry of Finance, the excise duty shall not be levied on such a motor vehicle.
(c) If the owner of a motor vehicle imported for personal use with the enjoyment of partial customs tariff facility dies and the motor vehicle has to be transmitted to the husband or wife of the owner of motor vehicle,
the excise duty shall not be levied on such a motor vehicle.
(3) An industry producing goods by using 90 percent or more native worn and torn or unusable goods shall enjoy exemption of excise duty leviable on such goods or products.

4D. Control of sale and distribution: The Government of Nepal may, if it so considers necessary, control the sale and distribution of goods subject to excise duty and manage such sale and distribution as prescribed.”
(6) The following Section 7 shall be substituted for Section 7:
“7. Fixation of price of product or service subject to excise duty:

(1) In cases where the excise duty is to be levied on
any product or service according to value (ad valorem), the excise duty shall be levied taking the following price as the basis:
(a) The factory price which a manufacturer determines at the time of selling a product subject to excise duty;
(b) In the case of service, the price of the service at the time of selling it; or
(c) The price specified by the Department on the basis of production/ manufacturing cost.

(2) In respect of a product to be imported into Nepal, the excise duty shall be levied on the price fixed by adding the customs tariff on such a product to the price fixed for the purpose of collecting customs tariff.
(3) Excise duty on service shall be collected by fixing the price as per the invoice.
(4) For purposes of collecting excise duty, the Department may, as per necessity, re-fix the price or fix additional price.”
(7) The following Section 9 shall be substituted for Section 9:
“9. Provisions relating to license:

(1) No one shall manufacture, import, sell or store a product subject to excise duty or deliver service subject to excise duty to any other person, without obtaining the license pursuant to this Act or the Rules framed under this Act.
Provided that, no excise duty license is required to manufacture, import, sell or store a product subject to excise duty or deliver service subject to excise duty by an industry subject to automatic release system, except the manufacturing of bricks, stone crusher, bidi, tobacco, khaini, pan masala, gudkha, khandsari industry and import of molasses and Gund and import of goods subject to excise duty under the diplomatic facility on the recommendation of the Ministry of Foreign Affairs.
(2) A person, firm, company or organization that intends to obtain the license referred to in Sub-section (1) has to make an application to the Excise Duty Officer for the license, in such format and accompanied by such fee as prescribed.
(3) In cases where an application is made to the Excise Duty Officer for the license pursuant to Sub- section (2), the Department or the Excise Duty Officer designated by the Department shall issue the license in the prescribed format if it appears proper upon making necessary examination on such an application.
(4) The term of the license issued pursuant to Sub- section (3) shall remain valid until one Fiscal Year.
(5) A licensee who intends to obtain the renewal of license has to obtain the renewal within the month of Shrawan after the expiration of the period specified pursuant to Sub-section (4) by paying the fees as prescribed. Provided that, if any licensee so intends, the licensee may obtain the renewal by for three Fiscal Years by paying the renewal fees at the same time.
(6) A licensee who fails to obtain the renewal within the period as referred to in Sub-section (5) has to pay the fine of Twenty Five percent of the renewal fees for obtaining the renewal within the first Three months of the expiration of such a period, that of Fifty percent of the renewal fees for obtaining the renewal within Three months thereafter, that of Seventy Five percent of the renewal fees for obtaining the renewal within Three months thereafter and that of cent percent of the renewal fees for obtaining the renewal within the last day of the month of Ashad thereafter.
(7) If a licensee intends to obtain the renewal of license after the expiration of the period specified in Sub- section (6), the licensee may obtain the renewal by paying the cent percent additional license fees for each Fiscal
Year and due amounts, in addition to the license fees as prescribed.
(8) If any person does transaction without obtaining the license as referred to in Sub-section (1), the person shall not be exempted from the fees chargeable for the license and for its renewal.”
(8) The following Section 9A. shall be inserted after Section 9:
“9A. Power to suspend license:

(1) If a licensee gives up doing transaction of goods or services subject to excise duty, the licensee has to make an application, accompanied by the reason, to the Excise Duty Officer for the suspension of the license.
(2) If an application is received pursuant to Sub- section (1), the Excise Duty Officer shall make decision to suspend or not to suspend the license of that licensee, and if it appears necessary to suspend the license, suspend it
and give information thereof to the licensee within Thirty days after the receipt of the application.
(3) The licensee who so gets information of the suspension of the license pursuant to Sub-section (2) shall
not be required to furnish details as referred to in Section

10A. after the next month of the suspension.
(4) The licensee shall not be required to obtain the renewal of license pursuant to Section 9 during the period of suspension of license pursuant to Sub-section (2).”
(9) The following Clause (d) shall be inserted after Clause (c) of Section 10:
“(d) In cases where the licensee organization is dissolved or the licensee makes an application for the cancellation of license.”
(10) The following Sections 10A., 10B., 10C., 10D., 10E., 10F., 10G., and 10H. shall be inserted after Section 10:
“10A. To furnish excise duty returns: A person who has obligation to determine and recover the excise pursuant to Section 3A. has to furnish the returns of transaction subject to excise duty for each month to the Excise Duty Officer or the prescribed excise duty returns by a registered post within Twenty Five days. Such returns have to be furnished irrespective of whether transaction subject to excise duty has been carried on in that month or not.

10B. To maintain accounts:

(1) A person who has obligation to furnish the excise duty returns pursuant to Section 10A. has to maintain accounts of the production and sale of goods or services subject to excise duty, of purchase, consumption of raw materials, subsidiary raw materials with specification of their price and quantity and of closing balance, along with the prescribed details, and shall provide such details as and when the Excise Duty Officer so demands for inspection.
(2) The accounts of purchase, production, release, sale and balance as referred to in Sub-section (1) shall be got certified by the concerned Excise Duty Officer and used for the purpose of maintaining accounts.
(3) The licensee has to safely retain the accounts of transaction for until Six years.
(4) For the implementation of this Act, the Excise Duty Officer may, by giving a notice in writing, seek information as to the transaction of goods and services subject to excise duty.

10C. Records processed by computer to be eligible as evidence:

(1) Notwithstanding contained in the laws prevailing, the records relating to excise duty of any person processed by the computer installed in the Department or offices thereunder or offices designated to administer the excise duty shall be eligible as evidence for purposes of excise duty, except as otherwise proved.
(2) The Department may so prescribe that the data relating to the goods or services subject to excise duty can be automatically retrieved by the Department or the office designated by the Department.
(3) The Department may make necessary arrangements on the submission of excise duty returns and payment of excise duty through electronic medium.”

10D. Power of Excise Duty Officer to determine excise duty:
(1) The Excise Duty Officer may determine the excise duty in any of the following circumstances:
(a) In the event of failure to submit the excise duty returns within the time limit,
(b) In the event of submission of incomplete or erroneous excise duty returns,
(c) In the event of submission of false excise duty returns,
(d) In the event of existence of a reliable ground for the Excise Duty Officer to believe that lesser amount of excise duty has been shown or the amount of excise
duty is not accurate,
(e) Where there is a ground and reason for the Excise Duty Officer to believe that the sales price has been under-invoiced and it is necessary to re-determine the price or to determine additional price pursuant to Sub-section (4) of Section 7,
(f) If the ceiling of production of goods or services subject to the excise duty is specified pursuant to or under this Act, the production ceiling is not met,
(g) If the difference between the liquors released and the alcohol content of waste material or substance if more than
One percent,
(h) In the event of evasion of excise duty,
(i) If any person does transaction of goods subject to excise duty without obtaining the license.
(2) In determining the excise duty pursuant to Sub- section (1), the Excise Duty Officer shall give a time-limit of Fifteen days to the concerned person to defend himself or herself.
(3) The Department may make monitoring of the determination of excise duty made pursuant to Sub-section
(1). If any error is found upon monitoring, the Director General may order the redetermination of excise duty.
(4) The Excise Duty Officer shall have the following powers for the purposes of determination of excise duty pursuant to Sub-section (1) or examination of the excise duty returns submitted duty pursuant to Section
10A.:
(a) To examine the goods, places, documents, accounts and records related with the liability of excise duty,
(b) To search the place of transaction of any person or other places where evidences related with the acts deemed offence under this Act can be found,
(c) To seek information from the persons who prepare any records, books, accounts and documents or fill up
details therein in the course of discharge of their duty,
(d) To take possession of or take elsewhere any documents, books and records situated in the place of transaction of goods and services subject to excise duty or other place related thereto,
(e) To make audit of excise duty in the place of transaction or office or other appropriate place,
(f) The Excise Duty Officer may seek information of any matter from a bank or financial institution or any person
in relation to the transaction of goods and services subject to excise duty.
(5) It shall be the duty of such a bank and financial institution or person to give information as sought by the Excise Duty Officer pursuant to this Section.

10E. Power to have expert’s service: The Department may obtain the service of liquor export, brewing expert,
chemical expert and other expert, as required, for the effective implementation of this Act.

10F. Power to specify ceiling of production of goods and services subject to excise duty:

(1) The rate of production ceiling of ethanol, spirit or ENA required to be obtained from grains, molasses or Khudo used by an industry producing nhydres ethanol, rectified spirit or ENA shall be determined in accordance with the
procedures as prescribed.
(2) If it appears that the production is less than the rate of ceiling prescribed pursuant to Sub-section (1), the production of highest quality liquors to be produced by the industry shall be deemed to have been made from the ethanol, spirit or ENA in such different quantity.
(3) The Department may specify the rate of ceiling of production of other goods and services subject to excise duty.

10G. To test the volume of alcohol: The Excise Duty Officer may at any time test or examine the content of alcohol of the liquors discharged with approval and of the waste substance and quality thereof. The alcohol content shall not be different more than One percent or quality shall not be altered significantly.

10H. Recovery of due excise duty: If any person does not pay the excise duty to be paid within the time limit as referred to in this Act, the concerned Excise Duty Officer my recover the same by way of any or all of the following
measures:
(a) Deducting the amount, if any, refundable to such aperson,
(b) By having deduction of such amount from the amount payable by the Government of Nepal or any corporate body owned by the Government of Nepal or local body to such a person,
(c) By having deduction of such amount from the interest of such a person in a bank, financial institution or other institution, Explanation: For the purposes of this Clause, the term ‘interest” includes deposits and investments held in a bank, financial or other institution.
(d) By withholding the sale, export, import and other business by and of such a person,
(e) By seizing the movable and immovable property of such a person,
(f) By auction selling any or all of the movable and immovable properties of such person at one time or at different times as prescribed.
(g) By auctioning the goods in stock.

10I. Delay fee: In the event of failure of a person to pay the excise duty within the time limit as referred to in this Act after the determination of the excise duty or for any other reason, except a circumstance as referred to in Clause (a) of Sub-section (1) of Section 4, there shall be charged a delay fee by 0.05 percent on the due and payable amount of excise duty per day.”
(11) The word “release” shall be substituted for the work “export” contained in Section 11.
(12) The following proviso shall be inserted in Clause (d) of Sub- section (3) of Section 12:
“Provided that, such suspension shall not exceed seven days; and decision shall be made no later than Sixty days after the making of such suspension.” (13) Of Section 13,
(a) The words “Inland Revenue Office” shall be substituted for the words “Excise Duty Office” contained in various
places of Sub-section (1).
(b) The following Sub-sections (4) and (5) shall be inserted after Sub-section (3):
“(4) The Department may give an information incentive expense of a maximum of Ten Thousand Rupees as prescribed to a person who provides information of the offence as referred to in this Section.
(5) The details of the person giving information of offence pursuant to this Section shall be kept secret.”
(14) The words “Inland Revenue Office” shall be substituted for the words “Excise Duty Office” contained in various places of Sub- section (1) of Section 14 and the following Clauses (a), (b) and (c) shall be substituted for Clauses (a), (b) and (c) of the same Sub-section:
“(a) Ten per cent of the amount in controversy to the informer,
(b) Twenty per cent of the amount in controversy to one who seizes and hands over a product only;
(c) Thirty per cent of the amount in controversy to one who arrests and hands over the person, along with the proof. Provided that, in cases where the informer who gives information or clue be more than one person, the reward shall be divided between them pro rata.”
(15) The words “Inland Revenue Office” shall be substituted for the words “Excise Duty Office” contained in Section 15: (16) Of Section 16:
(a) The following clause (b) shall be substituted for clause (b) of Sub-section (1):
“(b) To produce or import a product subject to excise duty without obtaining the license,”
(b) The following Sub-section (5) shall be inserted after Sub- section (4):
“(5) Where any person commits any of the following offences, the Excise Duty Officer may punish such a person with a fine as follows:
(a) In the event of re-determination of the price or determination of additional price pursuant to Sub-section (4) of Section 7, cent percent amount of the amount of excise duty to be added,
(b) In the event of making sale or storage of goods or services subject to excise duty without obtaining the license, from Five Thousand Rupees to Fifteen Thousand Rupees.
(c) In the event of violation of the provision of Section 10A., the amount of 0.05 percent of the leviable excise duty per day or One Thousand Rupees for each return, whichever is the higher.
(d) In the event of failure to maintain updated accounts as referred to ins Sub-section (1) of Section 10B., Ten Thousand Rupees and Five Thousand Rupees for each instance in the event of no allowing the accounts of transactions to be inspected,
(e) In the event of violation of Sub-section (2) of Section 10B., upto Five Thousand Rupees,
(f) In the event of violation of Sub-section (3) of Section 10B., Ten Thousand Rupees,
(g) In the event of obstruction in the act as referred to in Sub-section (3) of Section

10D., Five Thousand Rupees for each instance, (h) If, upon examination pursuant to Section 10G., the difference between the liquors released and the alcohol content of waste material or substance is more than One percent, cent percent of the amount of revenue leaked,
(i) If the ceiling of production of goods or services subject to the excise duty is specified and the production ceiling is not met, cent percent of the amount of excise duty to be added,
(j) In the event of violation of Section 4B., Ten Thousand Rupees for each instance,
(k) In the event of violation of this Act or the Rules framed under this Act, One Thousand Rupees for each instance.
(17) The following Section 17A. shall be inserted after Section 17:
“17A. Provision on payment by installment: Where any taxpayer makes a request in writing for the payment of any arrear excise duty by installment, permission may be given to pay the same by installment for One year.”
(18) The following Section 19 shall be substituted for Section 19:

“19. Provisions relating to administrative review and appeal:

(1) A person who is not satisfied with any decision by the Excise Duty Officer of excise duty assessment and recovery thereof may make an application for administrative review to the Department against the decision within Thirty days of the date of receipt of a notice of that decision.  Provided that, a person may make an appeal in the Revenue Tribunal against the decision of punishment of imprisonment for any offences as referred to in Sub- sections (1), (2), (3) and (4) of Section 16. (2) In cases where the time limit for making application pursuant to Sub-section (1) expires and any person makes an application for the extension of time limit within Seven days from the date of expiration of the time limit, the Department may extend the time limit for a period not exceeding Thirty days from the date of
expiration of the time limit.
(3) If the claim of the applicant appears to be true upon examining the evidence and documents including the application made by the taxpayer pursuant to Sub-section
(1), the Director General may, by executing a memorandum setting out the clear reasons, void that excise duty assessment order and direct the concerned Excise Duty Officer to make re-assessment of excise duty.
(4) The Department shall make decision on the application within Sixty days after the date of making of application pursuant to Sub-section (1).
(5) The taxpayer who makes an application pursuant to Sub-section (1) has to pay undisputed amount of excise duty and amount of fine, out of the amount of excise duty assessed, and furnish a cash deposit of One Third of the amount of excise duty in controversy and amount of fine.
(6) If the Department does not give decision within the time limit as referred to in Sub-section (4), the concerned person may, after the expiration of that time- limit, make an appeal to the Revenue Tribunal or if the person is not satisfied with the decision made by the Department, the person may make such an appeal in the Revenue Tribunal within Thirty Five days after the date of receipt of notice of the decision.
(7) A person who makes an application for administrative review or an appeal pursuant to this Section shall register a copy of the application or appeal with the concerned Office no later than Fifteen days.
(8) The implementation of the decision set forth in Sub-section (1) of Section 16 shall not be deemed to have been affected by the reason of making an application for administrative review or appeal pursuant to Sub-section(1).” (19) The following Section 22A. shall be inserted after Section 22:

“22A. Deemed to be excise duty: Any charge, delay fee or fine imposable pursuant to this Act shall be deemed to be the excise duty imposable pursuant to this Act.”

The following Section 23 shall be substituted for Section 23:
“23. Department to be responsible for implementation and administration: The Department shall be responsible for the implementation and administration of this Act.”
The following Section 24 shall be substituted for Section 24:

“24. This Act to prevail on excise duty provision : Notwithstanding anything contained in the laws in force, except in cases where the Financial Act to be enforced in every year amends this Act and provides for imposition,
assessment, increase, decrease, exemption, or remission of excise duty, no other Act may make any amendment to, or alter tax provisions referred to in this Act or make other excise duty related provisions.”
The following Section 25A. shall be inserted after Section 25:

“25A. Power to frame and issue manual: The Department may frame and issue necessary Manuals, subject to this Act and the Rules framed under this Act.The following Schedule shall be inserted in the Excise Duty Act, 2058 (2002):

 

 

 

 

 

 

 

 

 

Note:

(1) Notwithstanding anything contained above in the rate of excise duty, no excise duty shall be levied on the chassis of ambulances, corpse carrying vehicles and battery tempos.
(2) The procedures of collection of the excise duty leviable on the motor vehicles purchased and in stock until Fiscal Year 2065/066 shall be as mentioned in the Finance Act, 2065.
(3) Exemption of excise duty shall be granted, on the recommendation of the Department of Industries, to the raw maters imported by industries and used to produce goods as referred to in sub-heading 7213.91.10 of heading 72.13.
(4) In the event of cocktail of any liquors, the rate of tariff set forth in serial number 10 shall be applicable.
(5) Prepared liquors of 70 UP strength may be made by using rectified spirit of serial number 16 only.
(6) No local production of marble shall be subject to excise duty.
(7) No excise duty shall be levied on the goods of personal use imported enjoying the customs duty exemption facility under the Luggage and Baggage Order Facility.
(8) Exemption of 50 percent excise duty shall be granted to the local production of motor cycles and that of 25 percent to the local production of other motor vehicles.
(9) No excise duty shall be levied on the electric motor vehicles.
(10) Eighty percent exemption of excise duty leviable pursuant to this excise duty tariff shall be granted to the production of brandy by the local fruits based industries established in the least developed regions as mentioned in Schedule-9 of the Industrial Policy, 2067.
(11) The Director General may, for statistical purposes, add a digit to the eight digit sub-heading for the purposes of the rate of excise duty.
(12) The Department may, as required and in consultation with the Customs Department, interpret and specify the harmonized codes of the products/goods on which excise duty is leviable.

Election to the Members of the Constituent Assembly Act, 2064 (2007)

Election to the Members of the Constituent Assembly Act, 2064 (2007)
Date of Authentication and publication
Ashad 8,2064(june 22,2007)
1. Some Election Related Nepal Acts Amendment Act, 2064 (2008) 2064.9.20

An Act No. 2 of the Year 2064 (2007),
An Act Made to Provide for the Election to the Members of the Constituent Assembly
Preamble: Whereas it is expedient to make legal provisions on election to Members of the Constituent Assembly, electoral system and election procedures in order to constitute the Constituent Assembly for the purpose that Nepali people in exercise of sovereign and state power shall themselves make new constitution for themselves; Now, therefore, Legislature-Parliament has enacted this Act

Chapter – 1

Chapter – 1

Preliminary

1. Short title and commencement :

(1) This Act may be called “Election to the Members of the Constituent Assembly Act, 2064 (2007).”
(2) This Act shall come into force immediately.
(3) This Act shall remain valid for the period till the Constituent Assembly.

2. Definitions: Unless the subject or the context otherwise requires, in this Act, –
(a) “Constitution” means the Interim Constitution of Nepal, 2063 (2007).
(b) “Constituent Assembly” means the Constituent Assembly to be constituted pursuant to Article 63 of the Constitution.
(c) “Election” means the election to the members of the Constituent Assembly to be held pursuant to this Act and this term also includes the by-election to be held in such a circumstance where the post of the member elected under First Past The Post Electoral System falls vacant.
(d) “Constituency” means the constituency as referred to in Section 3.
(e) “Mixed Electoral System” means the electoral system as referred to in Section 4.
(f) “First Past The Post Electoral System” means the electoral system as referred to in Section 5.
(g) “Proportional Electoral System” means the electoral system as referred to in Section 6.
(h) “Political Party” means the Political Party registered pursuant to the prevailing law.
(i) “Commission” means the Election Commission as referred to in Article 128 of the Constitution.
(j) “Voter” means the person whose name has been registered in the Electoral Rolls pursuant to prevailing law for election.
(k) “Candidate” means the person who has been nominated as a candidate for a Member of Constituent Assembly pursuant to Section 21 and this term also includes the person whose name has been included in the closed list of the candidates submitted to the Commission pursuant to Section 7 by the Political Parties for the purpose of election under the Proportional Electoral System.
(l) “Closed list of candidates” means the list submitted to the Commission by the Political Parties as provided for in Section 7 for the purpose of filing candidacies ensuring proportional representation of Women, Dalits, Oppressed tribes/ Indigenous tribes, Backward regions, Madhesi, including other groups for election under the Proportional Electoral System where the Political Parties shall be voted upon considering the entire country as a single constituency.
(m) “Member” means the Constituent Assembly Member elected pursuant to this Act.
(n) “Returning Officer” means the Chief Returning Officer and Returning officer appointed by the Commission and this term also includes the Assistant Returning Officer.
(o) “Polling Officer” means the Polling Officer appointed pursuant to Section 14 and this term also includes the Assistant Polling Officer.
(p) “Ballot paper” means the ballot paper as referred to in Section 36 arranged for casting the vote in the election and this term also includes to the electronic device used for voting and the vote cast in case where arrangement has been made for voting by the electronic device.
(q) “Court” means the Constituent Assembly Court constituted in accordance with the Article 118 of the Constitution.
(r) “Prescribed” or “as prescribed” means prescribed or as prescribed in this Act or the Rule framed under this Act or in the order issued by the Commission by a notification to the Nepal Gazette

Chapter – 2

Chapter – 2

Constituency and Electoral System

3. Constituency: For the election to the Members of the Constituent Assembly, there shall be the following election constituencies and number of members pursuant
to Article 63 of the Constitution:
(a) Two hundred forty members elected from two hundred forty constituencies for the election to be held under First Past The Post Electoral System.
(b) Three hundred thirty Five members elected from the constituency set upon considering the entire country as a single constituency for the election to be held under the Proportional Electoral System where the Political Parties shall be voted.
(c) Seventeen members to be nominated by the Council of Ministers on the basis of understanding from amongst the persons of high reputation who have rendered significant contribution in national life.

4. Mixed Electoral System: The following mixed electoral system shall be adopted for election to the Members of the Constituent Assembly:
(a) First Past the Post Electoral System, and
(b) Proportional Electoral System where the Political Parties shall be voted.

5. First Past The Post Electoral System:

(1) The candidate securing the highest number of votes shall be elected to the Member of the Constituent Assembly on the basis of one member in one constituency for the constituencies determined pursuant to Clause (a) of Section 3 under the First Past The Post Electoral System.
(2) In the election under First past The Post Electoral System, one person may file his/her candidacy for two election constituencies in maximum. If a person so filing candidacies for two constituencies were elected from both constituencies, he/she should submit resignation before the Chairperson of the Constituent Assembly in writing by denouncing membership of any one constituency from where he/she was elected and thereby maintaining membership of other constituency within thirty days from the date of declaration of election result. The Commission shall forthwith fulfill place of the member of the Constituent Assembly so fallen vacant through by-election.
(3)The Political Parties must take into account the principle of inclusiveness while nominating candidates for the First Past the Post Electoral System.

6. Proportional Electoral System:

(1) Persons representing under Proportional Electoral System on behalf of a Political Party shall be elected to the Members of the Constituent Assembly in proportion of the number of total votes secured by such a Political Party in the election held pursuant to the Proportional Electoral System where the Political Parties shall be voted upon considering the entire country as a single constituency.
(2) No name of a person to be a candidate for the First Past The Post Electoral System shall be allowed to be included in the list under the Proportional Electoral System.

7. Closed list of candidates:

(1) Any Political Party willing to participate in the election under the Proportional Electoral System shall prepare a closed list of candidates contesting on behalf of such a party for such election.
(2) While preparing the closed list pursuant to Sub-section (1), the Political Parties shall prepare such list in a manner that candidacies shall be filed to cover at least 10 per cent of the members of the total number to be elected under the Proportional Electoral System.
(3) While enlisting the candidates, the Political Parties must prepare the closed list pursuant to Schedule-2 thereby ensuring the proportional representation of Women, Dalits, Oppressed tribes/ Indigenous tribes, backward region, Madeshi including others groups on the basis of the population per cent as referred to in Schedule-1. While so enlisting the candidacies of women, the same must be done as per the principle of inclusiveness thereby ensuring proportional representation of, Dalits, Oppressed tribes/ Indigenous tribes, backward region, Madeshi including others groups. While nominating candidates from Madhesi, the closed list of candidates must be prepared thereby ensuring proportional representation of Dalits, and indigenous tribes including other group on the basis of the per cent of population. The concerned Political Party shall submit the closed list of the
candidates so prepared to the Commission in such format as referred to in Schedule-2 within the time limit as specified by the Commission. Explanation : (1) For the purpose of this Section ‘basis of the population per cent ‘means the basis of the population per cent as per the last national census preceding the holding of the election of the Constituent Assembly.
(2) While enlisting the candidates pursuant to this Section, the Political Parties must pay proper attention to the representation of the oppressed group, poor farmers, and labors including disabled.
(4) There must be at least one-third women candidates of the totals number comprising the number of women candidates to be fielded under the Proportional Electoral System as referred to in Section 6 and the number of women candidates to be fielded under the First Past The Post Electoral System as referred to in Section 5.
(5) The Commission shall confirm as to whether representation is made on the basis of the principle of inclusiveness and proportion or not after submission to the Commission of the closed list of the candidates received from the Political Parties pursuant to Sub-section (3) and inform the concerned Political Party to make correction therein within seven days. After getting information accordingly, the concerned party shall amend and forward the closed list of candidates within seven days and the closed list of candidates so received shall remain as the final list.
(6) The Political Party shall submit to the Commission within such time as specified by the Commission the name list of candidates selected by the decision of the Central Working Committee of the concerned Political Party thereby ensuring proportional representation as prescribed in Sub-section (3) from amongst the candidates whose names have been enlisted to closed list of candidates submitted to the Commission pursuant to the said Sub-section in the proportion of the votes secured by that Political Party in the election held under Proportional Electoral System . The Commission shall declare that the candidates whose names have been enlisted in the name list of candidates so received by the Commission have been elected.
(7) In cases where the number of the concerned group in the name list of the elected candidates to be submitted by a Political Party pursuant to Sub-section (6) is indices but not full mark, the Election Commission shall recognize the name list of candidates sent by the concerned Political Party by setting out the name in the full mark rightly below or above such indices in the group not exceeding the seats which the concerned Political Party is entitled to declare as elected.
(8) The Commission shall scrutinize as to whether the name-list of the candidates submitted to the Commission upon selection pursuant to Sub-section (6) ensures proportional representation as referred to in Sub-section (3) or not. Provided that, while examining the candidates, the Commission may recognize an increase or decrease of up to ten per cent of the total number of each group.
(9) If it appears upon scrutinizing by the Commission pursuant to Sub- section (8) that the name list of candidates submitted by the concerned Political Party after selection does not ensures the proportional representation as referred to in Sub-section (3), the Commission shall write to the concerned Political Party to correct and submit the name-list accordingly.
(10) The concerned Political Party shall submit the amended name list of candidates to the Commission for the purpose of Sub-section (6) within three days from the date of request made by the Commission pursuant to Sub-section (9).
(11) If proportional representation as referred to in Sub-section (3) is not found in the amended name list of candidates submitted to the Commission pursuant to Sub-section (10), the Commission shall declare that the candidates of the concerned Political Party have proportionately been elected to the seats in such per cent as the name list of the candidates in such number of any group that ensures representation as referred to in Sub-section (3) is received. Provided that, the Commission may recognize an increase or decrease of up
to ten per cent of the total number of each group while declaring the elected candidates.
(12) The Commission must make public the information of election of candidates pursuant to this Section and must give notification thereof to the concerned Political Party.
(13) The names of the candidates shall not be allowed to be enlisted in the closed list of candidates to be prepared and submitted to the Commission pursuant to this Act thereby getting exceeded the number of total member
determined for the Proportional Electoral System.
(14) Notwithstanding anything contained elsewhere in this Section, the Election Commission shall recognize an increase or decrease made by a political party, which enlists less than twenty percent candidates out of the total number of the members to be elected under the proportional electoral system, in the percentage by having representation of the other groups, to the extent possible, in such a manner as to have equal number of women and men candidates in the percentage specified under Schedule-1 while preparing a closed list by that political party for the purpose of the election under that electoral system pursuant to sub-section (3), and the selection of any candidate selected from amongst the candidates enlisted in the closed list of candidates by the concerned political party of which only one candidate is elected.

8. The Closed list of candidates to remain valid throughout the term of office of the Constituent Assembly:

(1) The closed list of candidates submitted by the Political Parties pursuant to Section 7, shall remain valid throughout the term of office of the Constituent Assembly.
(2) If any post of a member of the Constituent Assembly elected under the Proportional Electoral System falls vacant due to death, resignation, defection or for any other reason, the candidates selected by the Central Working Committee of the concerned Political Party from amongst the list enlisted in the closed list of candidates upon ensuring representation pursuant to Sub-section (3) of Section 7 shall be deemed elected .

9. Election to be invalidated:

(1) If a question arises that any candidate enlisted in the closed list of candidates by any Political Party for the purpose of election under the Proportional Election System is ineligible and becomes ineligible pursuant to Article 65 of the Constitution and if the Commission holds him/her ineligible upon making necessary investigation to that effect, the candidacy of such candidate shall be invalid. Provided that, the Commission shall give reasonable opportunity to the concerned candidate to defend him/her prior to deciding by the Commission

Chapter – 3

Chapter – 3

Returning Officer, Polling Officer and Other Employees

10. Appointment of Returning Officer :

(1) The Commission may as per necessity, appoint the Returning Officer to carry out, or cause to be carried out, the functions required to be carried out in the election constituencies pursuant to the onstitution,
(2) While appointing the Returning Officer pursuant to Sub-section (1), the Commission may appoint a judge with the approval of the Judicial Council as referred to in proviso clause of Sub-article (1) of Article 110 of the Constitution
and at least Gazetted Second-class Officer of the Nepal Judicial Service in consultation with the Judicial Service Commission.

11. Functions, duties and powers of Chief Returning Officer:

(1) It shall be the duty of the Chief Returning Officer to give necessary directions upon co- coordinating and supervising the functions relating to election in the election constituencies within the District assigned to him/her subject to the direction given by the Commission.
(2) The Chief Returning Officer shall also carry out the functions and duties of Returning Officer in the election constituency assigned to him/her.

12. Functions, duties and powers of Returning Officer:

(1) It shall be the duty of the Returning Officer to freely and impartially carry out, or cause to be carried out, all the functions relating to holding election in the election constituency assigned to him/her, subject to the directions given by the Commission.
(2) Other functions, duties and powers of the Returning Officer shall be as mentioned in the orders, directives and manuals issued by the Commission.
(3) The Returning Officer may delegate his/her powers to the personnel assigned to the act of election as and when so required.
(4) No powers to examine accept or invalidate or cancel the nomination papers, and to count votes and declare the results of the vote counting may be delegated.

13. Appointment of Assistant Returning Officer and other employees:

(1) The Returning Officer may appoint an Assistant Returning Officer and other employees in such a number as prescribed by the Commission.
(2) The Returning Officer may, as per necessity, depute for the act of election the employees of the Government of Nepal or organizations owned or controlled by the Government of Nepal or run under the grant of the Government of Nepal or employees of local bodies or teachers of community schools.

14. Appointment of Polling Officer :

(1) The Returning Officer may appoint the employees of the Government of Nepal or organizations owned or controlled by the Government of Nepal or run under the grant of the Government of Nepal or employees of local bodies or teachers of community schools as the Polling Officers or Assistant Polling Officers in the required number for the concerned constituency.
(2) The Polling Officer and the Assistant Polling Officer appointed pursuant to Sub-section (1), shall get fairly, freely and impartially carried out all of the functions relating to the polling to be held as specified by this Act and the Rules or orders framed under this Act.
(3) Other functions, duties, and powers of the Polling Officer and the Assistant Polling Officer shall be as mentioned in the orders, directives, and manuals issued by the Commission.

Chapter – 4

Chapter – 4

Notification of Election

15. Election : The Commission shall hold elections for members of the Constituent assembly to be held pursuant to this Act on such date as specified by the Government of Nepal in accordance with Sub-article (2) of Article 63 of the Constitution.

16. Notification of Election:

(1) In order to complete the holding of polling for members of the Constituent Assembly on such date as specified by Government of Nepal in accordance with Sub-article (2) of Article 63 of the Constitution, the Commission shall specify the time for polling and issue a notification thereof and publish such notification in the Nepal Gazette.
(2) The Government of Nepal may, taking into consideration the geographical situation, weather and other circumstances as well, specify the single day date or different dates for taking polls for the election in one or more election constituencies and election held as per the election program on the single day date or different dates so specified by the Government of Nepal shall be deemed to have been held simultaneously.

17. Notification of Election Program:

(1) After the publication of the notification of the election pursuant to Section 16, the concerned Returning Officer, in accordance with the program determined by the Commission, shall publish a notification of the election to be held under First Past The Post Electoral System, specifying the date, time and place for the registration of nomination papers of candidates, publication of the list of candidates whose nomination papers have been registered, the filing
of petitions against candidates, scrutiny of nomination papers, publication of the name list of candidates nominated, withdrawal of candidature, publication of the final list of candidates and allotment of election symbols to the candidates.
(2) After the publication of the notification of election pursuant to Section 16, the Commission shall publish the program for submission of the closed list of candidates for the election to be held under the Proportional Electoral System to the Commission, filing of petitions against candidates and publication of the final closed list of candidates as well.

Chapter – 5

Chapter – 5

Candidates and Nomination Papers

18. Qualifications for Candidate: A person shall have the following qualifications to become a candidate for election:
(a) A Nepali citizen,
(b) Completed the age of at least twenty-five years of age,
(c) Not been convicted of a criminal offence involving moral turpitude,
(d) Not holding an office of profit.
Explanation: For the purpose of Clause (d) above, “office of profit” means any position other than a political position to be filled by election or nomination, for which a remuneration or economic benefit is paid out of a Government fund.

19. Disqualification of a Candidate :

(1) Notwithstanding any thing contained elsewhere in this Act, the following persons shall be deemed disqualified to become a candidate in the election:
(a) A person whose name is not enlisted in the Electoral Rolls,
(b) An incumbent office-bearer of the Government of Nepal or any institution owned or controlled by, or receiving grants from the Government of Nepal subject to receiving remuneration,
(c) A person who has not completed two years after serving sentence upon being sentenced pursuant to the prevailing laws relating to election,
(d) A person who has been finally sentenced by a court of law on corruption charges,
(e) A person who has been enlisted in the blacklist pursuant to the prevailing laws upon deliberately defaulting loan of a bank and financial institution,
(f) A person who has loses mental balance,
(g) A person who has held the political appointment and has been shown guilty in the report of the Probe Commission constituted pursuant to the Inquiry Commission Act, 2026 (1969) for loss and damage of lives and properties, abuse of power, authority and position, violation of human rights or misuse of state treasury at the time of Peoples’ Movement held for democracy in 2062 (2006) and 2063 (2006).

20. Computation of age of candidate: While computing the age of a person to become a candidate for the election, he/she must have reached twenty-five years of age by the date of filling nomination paper for First Past The Post Electoral System and submitting the closed list of candidates to the Commission for the Proportional Electoral System.

21. Nomination of a candidate:

(1) A person who is qualified to be a candidate pursuant to the Constitution and this Act, and whose name registered in the Electoral Rolls as a voter of any constituency may be nominated as a candidate for the election to be held pursuant to this Act.
(2) While nominating a candidate for a constituency pursuant to Sub-section
(1), there shall be one proposer and one seconder. Such proposer and seconder shall be voters registered in the Electoral Rolls of the same constituency.
(3) In the case of a candidate set up by a Political Party registered for the purpose of election, such a party shall have to provide a formal letter to him/her and the office bearer of the party authorized to provide such a formal letter shall forward a copy of such a letter to the Returning Officer, as well.
(4) In cases where any person is proposed pursuant to Sub-section (1), he/she shall have to set down his/her consent in the nomination paper and sign it.
(5) A person may be nominated by three nomination papers in maximum for the election of the same election constituency.
(6) Notwithstanding anything contained any elsewhere in this Section, while filing a nomination for the candidate under the Proportional Electoral System, the nomination shall be deemed to have been filed if a Political Party has included the names of the qualified candidates in the closed list of candidates and has submitted such closed list to the Commission. Such list shall contain the places of the Electoral Rolls where the names of each candidate so nominated are registered and the duplicates of their Nepalese citizenship certificates as well as their address.

22. Provision on Office-bearer certifying Nomination Paper:

(1) Any Political Party registered with the Commission for the purpose of election shall have to provide the Commission with the name, surname and post of the Office bearer of the Political Party authorised to provide a formal letter nominating candidates, as well as his/her specimen signature certified by the official designated by the Central Executive Committee of the Political Party, prior to at least seven days from the last date for filing nomination papers.
(2) In cases where a nomination paper is filed without fulfilling the procedures as referred to in Sub-section (1), the candidate of the concerned Political Party shall not be recognized as the candidate of that Political Party.

23. Filing of Nomination Paper:

(1) The Candidate himself/herself or his/her agent or proposer or seconder shall have to deliver the nomination paper of the candidate to the Returning Officer of the concerned constituency.
(2) The concerned Returning Officer shall scrutinise as to whether the nomination paper delivered pursuant to Sub-section (1) fulfils the requirement pursuant to this Act, and if it is found to be due, file the nomination paper and provide a receipt thereof as prescribed to the person delivering the nomination paper.
(3) If any nomination paper which does not contain the names of the proposer or seconder or where the proposer and seconder are duplicated, which is not accompanied by the receipt of deposit as required under this Act or which does not bear the signatures of the proposer or seconder or the person to be candidate or does not fulfill other requirements, the Returning Officer shall have to file the nomination paper after getting corrected the matter not incompliance with the formalities. If one wishes to get the nomination paper filed without correcting such matter not incompliance with the formalities as required to be corrected, the same matter shall have to be mentioned in the nomination paper and a notice thereof shall have to be issued to the person delivering the nomination paper.
(4) After the expiry of the time for filing the nomination, the Returning Officer shall publish a list of candidates whose nomination papers have been filed on the date, at the time and place as specified in the notification of the election program.
(5) Any candidate or his/her agent intending to make an objection to the qualification of any candidate mentioned in the list published pursuant to Sub- section (4) may make an objection before the Returning Officer on the date, at the
time and place specified in the notification of the election program.
(6) Notwithstanding anything contained anywhere else in this Section, the nomination papers of the candidates shall be deemed to have been filed as per the closed list of candidates submitted for the purpose of nominating candidates by the Political Party pursuant to Sub-section (6) of Section 21 for the election to be held under the Proportional Electoral System.

24. Scrutiny of Nomination Paper:

(1) The proposer, seconder or the candidate him/herself or attorney authorized by him/her in writing shall have to be present on the date, at the time and place as specified in the notification of the election program for scrutiny of the nomination papers filed for the election to be held under First Past The Post Electoral System.
(2) The Returning Officer shall scrutinise the nomination papers of all the candidates in the presence of the persons as referred to in Sub-section (1). Provided that, this Sub-section shall not be deemed to be barred from the scrutinising the nomination papers and making decision thereon according to the law even if any proposer, seconder or candidate or his/her attorney required to be so present is not present.
(3) While scrutinising the nomination papers of the candidates pursuant to Sub-section (2), the Returning Officer shall also have to make decision by holding necessary inquiries into objection, if any, made against any candidate pursuant to Sub-section (5) of Section 23. While scrutinising accordingly, if the proposer and seconder are found to be duplicated, the concerned candidate must be given an opportunity to make correction thereof and a nomination paper shall not be invalidated only by virtue of minor error and omission contained in the nomination paper. Explanation: For the purposes of this Sub-section, “minor error and omission” means any technical error or error of letters, numbers or vowel signs relating to the writing or printing or name, surname, address or serial number of a candidate, proposer or the person related with them contained in the Electoral Rolls or nomination paper, which does not cause any substantial difference.
(4) The Returning Officer may, in the following circumstances, postpone the proceedings on scrutiny of the nomination papers as required by this Section.
(a) If any mobbing including other abnormal situation erupts in the place and at the time of scrutiny of nomination papers, or
(b) If there occurs any situation beyond control owing to natural calamity.
(5) If the proceedings on the scrutiny of the nomination papers are postponed under Sub-section (4), the Returning Officer shall specify the time and place for the scrutiny of nomination papers and scrutinise them as soon as possible.

25. Invalidity of nomination paper: A nomination paper shall be invalid under the following circumstances:
(a) If the Candidate does not possess the qualifications as referred to in the Constitution and this Act,
(b) If there does not exist the consent of the candidate or the nomination paper does not bear his/her signatures or the signature of the proposer and seconder nominating him/her as a candidate or contains forged signature,
(c) If the deposit required to be furnished pursuant to Section 67 is not furnished,
(d) If the nomination paper is not filed within the time pursuant to Section 17,
(e) If the nomination paper is not filed as referred to in Section 22 and 23,
(f) If other requirement as referred to in the Act are not fulfilled.

26. Name list of candidates: After the nomination papers have been scrutinised, the Returning Officer shall have to prepare a name list of the candidates as referred to in the nomination papers meeting the requirements as per the law in the prescribed manner and publish a copy of the name list at his/her office. Provided that, the Commission shall make public the name list of the closed list of candidates submitted by the Political Parties for election under the Proportional Electoral System.

27. Withdrawal of names:

(1) If any candidate wishes to withdraw his/her name in order to get his/her name removed from the list of candidates, such a candidate may withdraw his/her name by giving a notice in writing to the Returning Officer within the time specified pursuant to Sub-section(1) of Section 17.
(2) The notice of withdrawing name pursuant to Sub-section (1) shall have to be submitted by the candidate him/herself or his/her representative.
(3) After the notice of withdrawing name pursuant to Sub-section (1) has been submitted to the Returning Officer, the notice shall not be allowed to be cancelled or withdrawn.
(4) The Returning Officer shall, if he/she is satisfied with the genuineness of the notice submitted pursuant to Sub-section (1), remove the name of the candidate withdrawing his/her name from the name list of candidates, and immediately publish a notice of the name removal at his/her office.
(5) If the authorized person of any Political Party so writes to the Returning Officer as to withdraw the name of any ♣ candidate set up by within the time limit specified pursuant to Sub-section (1) of Section 17, he/she shall not be retained as a candidate of that party.
(6) If a candidate enlisted in the closed list of candidates wishes to remove his/her name from the closed list of candidates within the time as specified pursuant to Sub-section (1) of Section 17, an application shall have to be filed
before the Commission. When such an application is filed, the Commission shall remove the name of such candidate from the closed list of candidates and the same must be notified to the concerned Political Party.

28. Final name list of candidates:

(1) After the expiry of the time specified for the withdrawal of names by the candidates pursuant to Sub-section (1) of Section 17, the Returning Officer shall have to prepare a final name list of the remaining candidates in such a manner as may be prescribed and immediately publish a copy of the name list at his/her office. A copy of the name list shall have to be forwarded to the Commission, as well, immediately.
(2) The names of the candidates shall be arranged in an alphabetical order in the name list as referred to in Sub-section (1), and in the case of a candidate nominated by any Political Party, the name of that party shall also be mentioned in the address as mentioned in their nomination papers

29. Provision regarding objection to the candidates under the Proportional Electoral System:

(1) The Commission shall have to make necessary scrutiny of the closed list of the candidates received pursuant to Section 7 and make it public.
(2) While publishing the closed list of candidates pursuant to Sub-section
(1), a notice must be published inviting to make objection thereto along with an application within seven days, if any candidate whose name is enlisted in such list does not possess qualification as referred to in the constitution and this Act,
(3) The Commission may publish and broadcast the closed list of candidates as well as the contents publishing a notice inviting objection thereto pursuant to Sub-section (1) and (2) at the national level media as and when so required.
(4) Any Political Party or any candidate having his/her name on the closed list, may raise an objection with evidence to the Commission within the specified time, indicating that the candidate of the closed list of the candidates is not qualified in accordance with the Constitution and this Act pursuant to Subsection (1).
(5) When an application of objection is received pursuant to Sub-section
(1), the Commission may make a necessary scrutiny and if the person of the closed list of candidates is not found to possess the qualifications as referred to in the Constitution and this Act, the Commission, shall remove such a name from the list setting out the same contents.
(6) After the completion of all the procedures regarding the raising of objection the Commission shall publish a final closed list of candidates at its office.
(7) After the completion of all the procedures regarding the raising of objections the Commission shall have to certify the final closed list of candidates and send it to the concerned Political Party.

30. Unopposed Election : If there remains only one candidate in any constituency under the First Past The Post Electoral System, the Returning Officer shall declare, as prescribed, that the candidate has been elected unopposed.

31. Election Symbols :

(1) The Commission shall specify the election symbols to be allotted to the candidates and the Political Parties for the election to be held under First Past The Post Electoral System and the Proportional Electoral System respectively.
(2) The election symbol specified pursuant to Sub-section (1) shall be allotted to the Political Party and candidate as prescribed.
(3) While allotting election symbol pursuant to Sub-section (2), the Commission shall so allot the symbol of the same kind to every Political Party registered under this Act as to be used by the candidate set up by it in any election
constituency for the election under the First Past The Post Electoral System and to be used by that Political Party for the election under the Proportional Electoral System.
(4) No person other than the candidate of that Political Party or the Political Party itself shall be entitled to use the election symbol allotted pursuant to Sub- section (3).
(5) Once a candidate has received an election symbol, the election symbol shall not be subject to alteration even if he/she abandons that Political Party or joins another party. If such a candidate is elected and if the Political Party providing such election symbol files a complaint accompanied by evidence, his/her membership shall be cancelled.
(6) While allotting election symbol pursuant to this Section, the election symbol received from the Commission for the purpose of election prior to commencement of this Act by a Political Party representing to Legislature- Parliament at the commencement of this Act must be allotted to that Political Party. If the Commission thinks that any mistake or inconsistency has occurred in the allotment of the election symbol as specified in this Section, the
Commission may alter such symbols.
(7) The Returning Officer shall allot, in such a manner as may be prescribed, an election symbol specified to be used by an independent candidate out of the group of election symbols set aside for the use of independent candidates.

32. Death of Candidate :

(1) If any candidate, set up by any Political Party whose nomination paper has already been held to be due and who has not withdrawn his/her name list, dies prior to the publication of the final name list of candidates pursuant to Section 28, and a written notice of such a death is received from the concerned candidate’s election agent or the concerned Political Party, the Returning Officer shall have to immediately postpone other program scheduled for that constituency and give information of the event to the Commission. The Returning Officer shall have to affix at his/her office a notice of such postponement of the program for information of the other candidates, as well.
Provided that, the election program shall not be postponed in the event of death of any candidate included in the closed list of candidates for proportional election.
(2) If after publication of the final name list of candidates pursuant to Section 28, any candidate nominated by a Political Party dies and a written notice of such death is received from the concerned candidate’s election agent or the concerned Political Party, the Returning Officer shall have to immediately postpone other program scheduled for that election constituency and inform the event of death to the Commission. The Returning Officer shall have to affix at his/her office a notice of such postponement of the program for information of other candidates, as well. Provided that, the election program shall not be postponed in the event of death of any candidate included in the closed list of candidates for proportional election.
(3) Upon receipt of information as referred to in Sub-section (1), the Commission shall have to so determine other program that it has no real impact on the polling program in that constituency, and that the program relating to the nomination of candidates can be completed as early as possible, and send the program to the Returning Officer. While determining the program in this way, the program shall have to be determined in such a way that the party whose candidate dies can only re-nominate another candidate.
(4) Upon receipt of information as referred to in Sub-section (2), the Commission shall re-determine other program as referred to in this Chapter for election including the date for polling in that constituency and send the program to
the Returning Officer.
(5) Candidate whose name is mentioned in the final name list of candidates published pursuant to Section 28 shall not be required to re-file a nomination paper, and the Political Party whose candidate died may only re-file a nomination paper on its behalf.
(6) Notwithstanding anything contained elsewhere in this Section, when election is to be postponed because of the death of a candidate, if the duration required to complete the activities as prescribed in election program remains more than fifteen days, it shall not be required to publish another program. Adjustments shall have to be made to complete the filling of the candidate’s nomination paper within the period as per the said program without causing any real impact on the polling

33. Identity card of candidate: The Returning Officer shall provide the identity cards, as prescribed, to the candidatesunder First Past The Post Electoral System, remained on the final name list pursuant to this Chapter.

Chapter – 6

Chapter – 6

Polling Station, Ballot Paper and Ballot Box

34. Polling station:

(1) The Commission shall specify the polling stations and sub- stations in the required number within the constituency and shall publish a list thereof in the manner as prescribed.
(2) The basis, process and other provisions of specifying polling stations shall be as prescribed.
(3) The Returning Officer may, if required, add to, and decrease the number of polling stations or transfer polling stations to a place that is more appropriate from the viewpoint of convenience or practicality, with the prior approval of the Commission.
(4) There may be more than one polling station or sub-station or polling compartment within the area of one polling station.

35. Ballot Paper :

(1) The Commission shall have to make arrangements of separate ballot papers in separate colours in such format as specified ……. ∝ for the election to be held under First Past The Post Electoral System and the Proportional Electoral System……… ∝
(2) Other provision regarding ballot papers shall be as specified by the Commission.

36. Ballot box: The Commission shall have to make arrangement for separate ballot boxes to be used for the polling in the elections to be held under the First Past The Post Electoral System and Proportional Electoral System

Chapter – 7

Chapter – 7

Polling

37. Time for Polling : The time for polling on the polling date shall be as specified in the notification as referred to in 23

38. Polling :

(1) A voter, whose name is registered in the Electoral Rolls of any ward of a Village Development Committee or Municipality of any constituency, shall be entitled to vote in the same ward of the same Village Development Committee or Municipality of that constituency. Provided that, this restriction shall not be applicable to the Provisional Voters.
(2) A voter shall be entitled to cast vote only at the polling station assigned to him/her in accordance with the Electoral Rolls.
(3) A voter shall first obtain the ballot paper for the First Past The Post Electoral System at the polling station assigned to him/her and cast his/her vote in the ballot box kept therefor and thereafter he/she shall obtain the ballot paper for the Proportional Electoral System and cast vote in the ballot box kept therefor. Provided that, a provisional voter may cast his/her vote only for the election under the Proportional Electoral System, as prescribed.
(4) No one other than a voter shall cast vote in the name of the voter whose name is registered in the Electoral Rolls.
(5) No one who is not qualified to cast vote pursuant to this Act shall cast vote.
(6) No voter shall vote at the same election in more than one constituency or at more than one polling station of the same constituency.
(7) No voter shall vote more than once in any constituency other than the elections under the First Past The Post Electoral System and Proportional Electoral System.

39. Polling Method:

(1) The Polling Officer shall give prescribed ballot paper to the voter present at the polling station for voting by fulfilling the procedure as prescribed.
(2) Before giving the ballot paper to a voter, the Polling Officer shall enter the matter as prescribed in the Electoral Rolls and give the ballot paper as prescribed.
(3) The voter shall have to vote by marking in the ballot paper with such seal or sign as prescribed in a secret manner.
(4) The voter shall vote for the First Past The Post Electoral System by marking the seal or sign in the ballot paper’s box contenting the election symbol of any one candidate whom he/she choose and for the Proportional Electoral System in the box of the ballot paper’s box containing the election symbol or sign of any one Political Party whom he/she chooses as referred to in Sub-section (3) and drop the ballot papers into the designated ballot box.
(5) Notwithstanding any thing contained elsewhere in this Act where electronic device are used for polling purposes, the voter shall have to cast vote through electronic device as prescribed.

40. Power to postpone polling in special circumstances:

(1) Where the Polling Officer appointed to a polling station or the Returning Officer of that constituency is satisfied that the act of polling cannot be conducted owing to any commotion as well as other extra-ordinary situation at the polling station or owing to non operation of electronic device or any riot or natural calamity or any force majeure, he/she may postpone the polling at that polling station immediately and publish a notice thereof at that place. Where the Polling Officer has postponed the polling, he/she shall give a notice thereof to the Returning Officer immediately.
(2) The Returning Officer should give information of the postponement of polling pursuant to Sub-section (1) to the Commission immediately and to other concerned authorities, as well.
(3) Upon receipt of the information pursuant to Sub-section (1), except as otherwise directed by the Commission, the Returning Officer publish a notice indicating the date and time for re-polling in that polling station and conduct such re-polling.

41. Unauthorized seizure of polling station:

(1) A polling station shall be considered seized in the following circumstances:
(a) If any one, by using force or coercion, or showing intimidation or giving threat, takes control over the polling station or the voting compartment (or place fixed for voting) or electronic device and affects the polling or allows
only the voters supporting any candidate to vote or prevents other voters
from voting,
(b) If any one, with or without using force, shows threat or fear to the voters to or not to vote for any candidate or prevents the voters from going to or entering into the polling station for polling,
(c) If any one, with or without using force, prevents the employees involved in the act of polling from discharging their duty, or snatches the ballot papers, ballot boxes, electronic device for voting or other election materials or so
affects that the polling cannot be held in an impartial and free manner by doing similar other acts.
(2) Where any event as referred to in sub-section (1) occurs, the Polling Officer shall give a report thereof, accompanied by his /her opinion, to the Returning Officer, and the Returning Officer shall give such report to the
Commission immediately.
(3) On receipt of the report as referred to in sub-section (2), the Commission may depute a Monitoring Team to make inquiry in that place; and the Commission may, based on the report given by the Monitoring Team, if any, so deputed and other state of affairs, as well, cancel the polling of that polling station. The Returning Officer should, as directed by the Commission, specify the date and time for conducting re-polling at the polling station where polling has been so canceled.
(4) Where it appears from the report as referred to in Sub-section (2) and other state of affairs that the unauthorized seizure of the polling stations could affect the results of election, the Commission may cancel the election of that
constituency; and the Returning Officer may specify the date and time for re- polling.

42. In case of damage or destroy of ballot box and electronic device :

(1) Where any ballot box used for polling or electronic device installed at the polling station is lost accidentally or knowingly destroyed, the Polling Officer shall have to give a report thereof to the Returning Officer of the election constituency where the polling station is located immediately and the Returning Officer shall have to give a report thereof to the Commission.
(2) Where any ballot box used or electronic device for polling and already handed over by the Polling Officer to the Returning Officer is snatched in any way or lost accidentally or is knowingly destroyed, the Returning Officer shall give a report thereof, accompanied by his/her opinion on the event, to the Commission immediately.
(3) The Commission upon receipt of the report along with the opinion as referred to in Sub-section (1) or (2), depute a Monitoring Team to investigate all the related incidents and circumstances, also upon studying the report of the Monitoring Team, if so deputed, cancel the polling of that polling station.
(4) The Concerned Returning Officer shall, at the direction of the Commission, specify the date and time for re-polling at the polling station where the polling has been cancelled pursuant to Sub-section (3) and publish a notice thereof.

43. Objection to impersonation of a voter :

(1) If any person falsely impersonating any other voter presents himself/herself to receive a ballot paper to vote, a Political Party or candidate or their agent may register an objection with the Polling Officer in such a manner and along with a deposit of such sum as may be prescribed.
(2) If an objection is made pursuant to Sub-section (1), the Polling Officer shall make a summary investigation and decide immediately and shall forthwith record the objection so made and the decision thereof in such a minute book as may be prescribed.
(3) If the objection as referred to in Sub-section (1) is held to be correct, the Polling Officer shall return the sum of the deposit to the concerned person. If the objection is not held to be correct, the sum of the deposit shall be forfeited.

44. Admission to polling station:

(1) The Polling Officer shall not allow other persons except the following persons to enter into the polling station:
(a) Voters,
(b) Agent of a Political Party or a candidate or one of his/her agent,
(c) Observers permitted by the Commission,
(d) Persons permitted by the Commission or Returning Officer or Polling Officer,
(2) No voters other than those who have already entered into the polling station shall be entitled to enter into the polling station after the expiry of the time for polling.

45. Inspection by Polling Officer: If a voter stays in the voting compartment for more than reasonable time or the Polling Officer has any suspicion, he/she may enter into the voting compartment and inspect there.

46. Disabled Voters:

(1) If any voter being unable to vote by him/herself owing to physical disability or any other reason requests for permission to be accompanied by any person whom he/she trusts and the Polling Officer shall, if he/she considers it to be reasonable, allow such a person accompanied by the voter to enter into the voting compartment.
(2) If any voter being unable to vote by him/herself requests the Polling Officer to mark his/her vote in the box containing the symbol of his/her choice on the ballot paper or requests the Polling Officer for permission to be accompanied by another person to mark his/her vote in the box containing the symbol of his/her choice, arrangements shall have to be made so that the Polling Officer or the person whom the voter has with his/her free will and consent, chosen on his/her behalf, shall assist the voter in marking the vote.
(3) Notwithstanding anything contained elsewhere in this Act, the Commission may make special arrangement for voting by the blind, disabled, elderly persons, pregnant women and other voters suffering from other similar physical infirmities.

Chapter – 8

Chapter – 8

Counting of Votes and Election Results

47. Returning Officer to carry out, or cause to be carried the counting of votes: The Returning Officer shall carry out, or cause to be carried the act of counting of votes of his/her election constituency under his/her direct supervision and control.

48. Notice of counting of votes: After receiving from the Polling Officers all the ballot boxes used for polling at all the polling stations in the constituency, the Returning Officer shall publish a notice specifying the place, date and time for counting of votes for information of the Political Parties and candidates. While specifying the time for counting of votes, the time shall be specified as far as possible in such a manner that the counting of votes of both the electoral system shall coincide and if it is impossible to so carry out the counting of votes simultaneously the priority shall be given for counting of votes under the First Past The Post Electoral System.

49. Counting of votes:

(1) The Returning Officer, as far as possible, shall have to commence the act of counting of votes under both Electoral System simultaneously at the place, date and time as referred to in the notice under Section 48 and if it is not possible to commence the act of counting of votes simultaneously, the Returning Officer shall have to commence first the act of counting of votes of the election under the First Past The Post Electoral System as prescribed and after completion of such counting of votes , the Returning Officer shall have to carry out the act of counting of votes secured by the Political Parties in the election under the Proportional Electoral System.
(2) The Political Parties, candidates or their agents and necessary counting agents may appear at the place, time and on the date for the counting of votes as referred to in Sub-section (1).
(3) If re-polling is to be held at any polling station of any constituency pursuant to this Act, the counting of votes of other polling stations of that election constituency shall not be commenced until the completion of the polling at that
polling station.

50. Entry into the place for counting of votes:

(1) The Returning Officer may allow representatives of the Political Parties or candidates or their election agents and counting agents, the person deputed in the counting of votes, persons deputed for observation and monitoring, employees deputed for security, and the person deputed by the Commission to enter into the place for counting of the votes.
(2) The Returning Officer may order any person who causes obstruction in the act of counting of votes to go out from the place of counting of votes, and the person receiving such an order shall have to go out of the place for counting of votes. The employees deputed for security in that place shall, by the order of the Returning Officer, expel from that place the person who does not carry out that order and becomes self-willed.

51. Counting of votes to be continuous :

(1) Once the counting of votes is commenced, the Returning Officer shall keep on the act of counting of votes continued until the completion of the counting of votes.
(2) If, owing to any circumstances of force majeure , the act of counting of votes has to be adjourned in the meantime, the Returning Officer shall prepare an inventory of the ballot papers already counted, documents relating to the counting of votes, ballot papers remain to be counted, and the ballot boxes of which ballot papers have not been counted, and keep them in different envelops, bags or sacks and seal them with his/her own seal. The Political Parties or candidates or their vote counting agents or election agents, as well may, if they so wish, also put their own seal on the envelopes, bags or sacks.
(3) The act of counting of votes adjourned pursuant to Sub-section (2) shall have to be resumed as soon as possible. A notice on the resumption of the counting of votes pursuant to this Sub-section shall have to be given to the Political Parties or candidates or their election agents or counting agents present in that place and be published also in the place for counting of votes. Provided that, the counting of votes shall not be barred for the reason that the Political Parties or candidates or their agents are not present.

52. Loss of ballot papers prior to completion of the counting of votes:

(1) If, prior to the completion of the counting of votes, the ballot papers and ballot boxes containing the ballot papers used at any polling station or the electronic device kept for polling are taken elsewhere out of the custody of the Returning Officer in an illegal manner or opened or destroyed or deliberately broken or lost or damaged accidentally, the Returning Officer shall adjourn the act of counting of votes, and give a report thereof to the Commission immediately .
(2) After the counting of votes has been adjourned pursuant to subsection
(1), the Commission shall declare the whole polling of such polling station to be illegal; and the Returning Officer shall, at the direction of the Commission, publish a notice specifying the place, date and time for re-polling at such polling station.

53. Unlawful seizure of place for counting of votes:

(1) The place for counting of votes shall be deemed to have been unlawfully seized in the following
circumstance:
(a) If any one by using force or coercion, or showing intimidation or giving threat, seizes the place for counting of votes or seizes the ballot papers or ballot boxes containing such ballot papers or electronic device kept for voting from the custody of any official or employee engaged in the counting of votes or interferes with, or affects, the counting of votes by committing similar other acts, or
(b) If any person engaged in the counting of votes commits the act as referred to in Clause (a) or aids to or acquiesces in the commission of such act.
(2) Where the place for counting of votes is seized unlawfully pursuant to Sub-section (1), the Returning Officer shall immediately adjourn the counting of votes and give a report thereof to the Commission immediately.
(3) Upon receipt of the report as referred to in Sub-section (2), if the Commission may, if it deems necessary to hold inquiries into the incident, depute a Commissioner of the Commission, or a Monitoring Team, to hold inquiries there into.
(4) If, on the basis of the report as referred to in Sub-section (2), or of the report of the Commissioner or the Monitoring Team deputed to hold inquiries pursuant to Sub-section (3), the Commission holds that the place for counting of votes was unlawfully seized as referred to in Sub-section (1), it may declare invalid all the ballot papers of the polling station affected from that seizure and cancel the polling.
(5) The Returning Officer shall publish a notice specifying the place, date and time for re-polling at the concerned polling station in respect whereof the polling have been cancelled by the Commission pursuant to Sub-section (4).

54. Invalidity of ballot papers : A ballot paper shall be invalid in the following circumstances:
(a) If it does not bear the signature of the concerned Polling Officer,
(b) If the mark indicating the vote is not placed as prescribed but marked with any other manner or it bears any other symbol,
(c) If the mark indicating the vote is so used that cannot be identified,
(d) If it bears the mark indicating vote elsewhere than in a box containing the symbol of the candidate or Political Party,
(e) If it has been returned to the Polling Officer with the intention of abstaining from voting,
(f) If the mark indicating the vote is so placed that it is not clear to signify definitely as to which candidate or Political Party the vote has been given for,
(g) If the mark indicating the vote is placed in the boxes of more than one box in a manner that it cannot be ascertained as to which candidate the vote was given,
(h) If the vote is cast with a ballot paper other than the ballot paper specified for the concerned polling station,
(i) If the ballot paper other than that issued by the Commission are used, and
(j) If the ballot paper specified for the concerned constituency has been used for another constituency.

55. Recounting of votes :

(1) A representative of any Political Party with regard to counting of votes of election held under the Proportional Electoral System and any candidate of the concerned constituency or his/her election agent or counting agent with regard to counting of votes of election held under the First Past The Post may, before the completion of the counting of votes or prior to sealing the counted ballot papers, make an application in writing setting out the reason there for to the Returning Officer forthwith for recounting of any or all the ballot papers.
(2) If an application is made pursuant to Sub-section (1), the Returning Officer shall immediately register the application and may recount the votes if it seems necessary to recount the votes.
(3) If it is not necessary to recount the votes pursuant to Sub-section (2), the Returning Officer shall make a decision accordingly and give a notice of the decision to such candidate, his/her election agent, or counting agent so present at that place prior to the declaration of the election result.

56. In case of tie : If, after the completion of the counting of votes of the election under the First Past The Post Electoral System, two or more candidates receive equal number of votes, the Returning Officer shall decide by drawing lots amongst the candidates receiving equal number of votes.

57. Publication of the result of the First Past The Post Electoral System:

(1) After the completion of the act of counting of votes of all the polling stations polled in any constituency under the First Past The Post Electoral System, the Returning Officer shall prepare a chart of counting of votes as prescribed and publish the election results as prescribed and shall have to forthwith send a copy of the result chart to the Commission.
(2) While publishing the results of the election pursuant to Sub-section (1), the Returning Officer shall have to declare the candidate receiving the highest number of valid votes as elected and award the certificate to him/her indicating his/her election as prescribed.
(3) After the publication of the results of the election, the Returning Officer shall prepare his/her report including the details relating to the election as prescribed and send it to the Commission as soon as possible.
(4) Upon receipt of the chart of the results of election pursuant to Sub- section (1), the Commission shall prepare a name list of the elected members and send copy of that name list of the candidates elected accordingly to the Prime
Minister and the Legislature-Parliament and the Commission shall also publish the name list in the Nepal Gazette.

58. Declaration of the result of the proportional election results:

(1) The Returning Officer shall have to count the votes cast for the election under the Proportional Electoral System and forthwith send the total number of valid votes secured by each Political Party to the Commission by setting out in a chart as prescribed.
(2)After receiving the report of total number of valid votes secured by the Political Parties through out the country in the election under the Proportional Electoral System upon considering the entire county as a single constituency, the Commission shall declare elected the candidates presented to the Commission upon selecting by the Central Executive Committee of each Political Party pursuant to Sub-section (6) of Section 7 from amongst the candidates enlisted in the closed list of candidates submitted by the Political Party to the Commission in proportion to the votes secured by that Political Party. The Commission shall send the name list of the candidates so elected to the Prime Minister and to the Legislature-Parliament and also publish the said name list in the Nepal Gazette.
(3) For the purpose of determining the number of seats to be won by a Political Party in proportion to the total valid votes secured by that Political Party in the election held under the Proportional Electoral System, the Commission shall apply the Results Divisor Method as mentioned in Schedule-5 and decide the number of seats to be won by that Political Party accordingly.
(4) If more than one Political Party are found secured an equal number of votes with regard to any seat while distributing number of seats to be won by the parties upon dividing total valid votes secured by the Political Parties as per the Result Divisor Method as referred to in Sub-section (3), the issue as to which Political Party shall win such a seat shall be decided by lots.

59. Date of Election (1) With regard to the election held under the First Past The Post Electoral System, the date of declaration of the results of election by the Returning Officer pursuant to Section 57 shall be deemed to be the date on which the concerned candidate has been elected.
(2) With regard to the election held under the Proportional Electoral System, the date of the declaration of the candidate of the Political Parties elected from the closed list of candidates by the Commission pursuant to Section 58 shall be deemed to be the date on which the concerned candidate has been elected.

Chapter – 9

Chapter – 9

Agents of Candidate

60. Election agent:

(1) If any candidate appoints a person as an election agent, the notice thereof shall have to be given in writing to the Returning Officer.
(2) The Political Party may appoint its election agent as prescribed for all the activities of election under the Proportional Electoral System.
(3) The candidate or Political Party may, at any time remove the election agent appointed pursuant to Sub-section (1) and (2) and appoint another agent and shall have to give a notice thereof to the Returning Officer immediately.
(4) The qualification of the election agent shall be as prescribed.

61. Duty of election agent : It shall be the duty of the election agent appointed pursuant to Section 60 to perform such functions as mentioned in this Act and the Rules framed under this Act to be performed by the election agent.

62. Polling agent and counting agent :

(1) A candidate or his/her election agent, a Political Party or its agent may appoint polling agent in such number as prescribed for each polling station and shall have to give a notice thereof in writing to the Polling Officer and the Returning Officer.
(2) A candidate or his/her election agent or a Political Party or its agent may appoint counting agents in such a number as prescribed to be present at the place of counting of votes and shall have to give a notice thereof in writing to the Returning Officer.
(3) Any candidate or election agent may at any time remove the polling agent or counting agent appointed pursuant to sub-section (1) or (2) and appoint another polling agent or counting agent, and shall have to forthwith give a notice thereof to the Polling Officer in the case of appointment of polling agent and to the Returning Officer in the case of appointment of counting agent.
(4) The qualification of the polling agent and the counting agent shall be as prescribed.

63. Duty of the polling agent and the counting agent:

(1) It shall be the duty of the polling agent to perform all functions required to be performed by him/her at the polling station pursuant to this Act and the Rules framed under this Act.
(2) It shall be the duty of the counting agent to perform all the functions required to be performed by him/her pursuant to this Act and the Rules framed under this Act.

64. Absence of candidate or any agent: If an election agent or polling agent or counting agent is not appointed pursuant to this Act and the Rules framed under this Act, or the candidate or any of his/her agent is not present as and when required, or any of them fails to perform such functions as are required to be performed, the act of polling or counting of votes shall not be adjourned and such act shall not be deemed to be invalid merely on that ground

Chapter – 10

Chapter – 10

Miscellaneous

65. Bye-election: If a post of Member of the Constituent Assembly elected under the First Past The Post Electoral System falls vacant at the time when the term of office of the Constituent Assembly shall remain valid for a period more than six months, the Commission shall fulfill such vacant post through bye-election.

66. Provision for tendered ballot papers :

(1) If anyone has, by impersonation, already obtained the ballot paper or voted in the name of another voter, and the person who has come afterwards to vote, is found, from the evidence submitted by him/her, to be the real voter, the Polling Officer shall give a tendered ballot paper to such a voter. Where such tendered ballot paper is given, after the voter has indicated his/her vote on the ballot paper, such a ballot paper shall not be inserted into the ballot box but shall be placed in a separate envelope kept for that purpose.
(2) The procedures for giving and placing of the tendered ballot paper pursuant to Sub-section (1) and other procedures pertaining thereto shall be as prescribed.
(3) While counting the votes pursuant to the provisions of this Act, the tendered ballot papers placed in a separate envelope pursuant to Sub-section (1) shall not be counted at that time. If a petition relating to the election is filed and the court holds that the tendered ballot papers are necessary to settle the petition, the court may also count such tendered ballot papers.

67. Deposit to be furnished:

(1) To be a candidate under First Past The Post Electoral System from any election constituency, a sum of three thousand Rupees shall have to be deposited, and a Political Party submitting a closed list of the candidates before the Commission for an election under the Proportional Electoral System shall have to deposit a sum of ten thousand Rupees.
(2) If more than one nomination paper is filed for one candidate in one election constituency for election under First Past The Post Electoral System, it shall be sufficient to furnish the deposit for one nomination only.
(3) While filing a nomination paper for a candidacy of the election under First Past The Post Electoral System, the nomination paper submitted to the Office of the Returning Officer must include the cash or bank receipt of the cash deposit. When a Political Party submits a closed list of the candidates before the Commission for the election under the Proportional Electoral System, the closed list must be accompanied by a receipt of a cash deposit or bank receipt in favour of the Commission.

68. Forfeiture of Deposits:

(1) The deposit of the candidate who receives less than ten per cent of the total valid votes cast in any election under First Past The Post Electoral System shall be forfeited. Provided that, in the case of the elected candidate, this provision shall not be applicable.
(2) If any Political Party fails to win at least one seat from the total valid votes cast in the election under the Proportional Electoral System, the deposit furnished by such Political Party shall be forfeited.
(3) Except where the deposits are liable to be forfeited pursuant to sub- section (1) or (2), the candidates and persons whose nomination papers have been rejected or who have withdrawn their names, shall get back their deposit within
three months after the declaration of election results.
(4) If the deposit is not withdrawn within the time frame as referred to in Sub-section (3), the sum of deposit shall be credited to the Consolidated Fund.

69. Election expenses :

(1) The ceiling of the amount allowed to be expended by the candidate in the election under First Past The Post Electoral System and by the Political Party in the election under the Proportional Electoral System shall be as prescribed by the Commission upon a notification published in the Nepal Gazette.
(2) A Political Party, a candidate, or its/his/her election agent shall have to maintain the records of all expenses incurred in the election during the period of election in such a format as may be prescribed. Explanation: For the purposes of this Section, “period of election” means the period beginning from the date of filing of the nomination paper of the candidates for the First Past The Post Electoral System or from the date of the filing of the closed list of candidates for the Proportional Electoral System to the date of declaration of the election results.
(3) The total expenditure incurred by any Political Party or candidate in the election shall not exceed the ceiling of expenses as prescribed in Sub-section (1).
(4) In the case of the Proportional Electoral System, the statement of election expenses as referred to in sub-section (2) shall have to be given to the Commission by the Political Party within thirty five days after the declaration of the election results and the expenses incurred in the case of the candidates of the election under the First Past The Post Electoral System the same shall have to be given to the District Election Office by the candidates or their agents within thirty five days after the declaration of election results. The District Election Office shall have to forward the statement of expenses so received to the Commission.

70. Secrecy of documents related to election :

(1) Out of the documents used in the election, those required for the purpose of the counting of the votes shall be opened and looked into and sealed after the completion of the counting of the votes and, thereby, shall be kept in custody of the District Election Officer.
(2) The sealed envelopes, bags or sacks containing the counterfoils of the ballot papers sealed pursuant to Sub section (1), the Electoral Rolls used in the polling, and the valid and invalid ballot papers may be opened and looked into only by the Court in connection with the petition filed pursuant to the prevailing laws.
(3) After they have been opened and looked into by the order of the Court pursuant to Sub-section (2), the Court shall seal and restore them in their original form. No official or body other than the Court shall have the authority to open and look into such sealed envelopes, bags or sacks.
(4) The documents mentioned in this Section shall be preserved for three months from the date of the final settlement of the case, if any filed, and from the date of the expiry of limitation for filing a petition if no case has been filed.

71. Prohibition on divulgence of secrecy:

(1) Except as authorized by the law, any employee deputed in performing the act relating to election or candidate or election agent or polling agent or counting agent or any other person shall not divulge to any person, write or disclose in any manner, the vote marked by the voter in the ballot paper or any other matter pertaining thereto known to him/her or which he/she comes to know.
(2) Notwithstanding anything contained in this Act or other prevailing laws, no witness or person shall be asked in the course of legal proceeding instituted under this Act any question as to whom he/she has voted for election or who has voted for whom.

72. Power to issue orders and give directives :

(1) In addition to the matters contained in this Act and the Rules framed under this Act, the Commission may issue necessary orders in regards to the elections and the Commission shall publish such orders in the Nepal Gazette.
(2)The Commission may issue necessary directives to the employees deputed in the act of election for the conduct of the election.
(3) It shall be the duty of all including the Government of Nepal, governmental offices and bodies, governmental, semi governmental and non- governmental organizations and bodies, Political Parties, candidates and their agents, as well as person carrying out election canvassing and the employees deputed in the act of election to abide by the orders and directives issued by the Commission pursuant to this Section.

73. Power to seek assistance:

(1) The Returning Officer, the Polling Officer or Monitoring Team, Observer or any official deputed by the Commission in the act of election may, in the course of the act of election, seek assistance from any governmental body or body relating to security including the police at the local level.
(2) If assistance is so sought pursuant to Sub-section (1), it shall be the duty of the concerned police as well as government and security related body to render the necessary assistance.

74. Power to frame Rules: The Commission may frame necessary Rules in order to carry out the objectives of this Act.

75. Power to formulate and enforce directives: The Commission may formulate and enforce necessary manuals to implement the objectives of this Act subject to this Act and the Rules framed under this Act.

75A. Power to make procedure : the commission may make necessary procedure for implementation of this act or Rule made thereunder this Act and such procedure shall come into force .

76. Power to remove difficulties: If any difficultly arises in connection with the implementation of this Act and Rules, manuals and orders issued under this Act, the Commission may issue necessary orders to remove such difficulty.

 Customs Act, 2064 (2007)

Customs Act, 2064 (2007)
Date of authentication
14 Bhadra 2064 (31 August 2007)
Act number 16 of the year 2064 (2007)
An Act Made to Amend and Consolidate Customs Laws
Preamble: Whereas, it is expedient to amend and consolidate the prevailing customs laws in order to make safe and facilitate international trade by making customs administration systematic, transparent and accountable; Now, therefore, the Legislature-Parliament has enacted this Act.

Chapter -1

Chapter -1

Preliminary
1. Short title and commencement :

(1) This Act may be called as the “Customs Act, 2064(2007)”.
(2) This Section shall commence immediately, and the other Sections shall commence on such date as may be appointed by the Government of Nepal, by notification in the Nepal Gazette.

2. Definitions : Unless the subject or the context otherwise requires in this Act, (a) “Duty free shop” means a shop permitted by the Government of Nepal to sell any goods imported against the bank guarantee facility to any persons who are entitled to enjoy diplomatic privileges or customs facilities or to the concerned air companies for international flight catering or for sale at any duty free shop of such flight.
(b) “Transaction value” means the total amount to be set by adding freight, insurance and other related costs incurred or incurable in the transportation of goods imported by an importer up to the border of Nepal to the price actually paid or payable, directly or indirectly, by the importer to the seller of such imported goods.
(c) “Diplomatic facility” means such facility or privilege as to allow the exportation or importation of any goods keeping only books of record, without examining such goods and collecting duty.
(d) “Declaration” means the mentioning by the exporter or importer of the details of goods to be exported or imported in the declaration form or transmitting the same, as prescribed, through any electronic media.
(e) “Export smuggling” means the exportation from Nepal of any goods subject to customs duty without payment of such duty or clandestinely or through illicit routes or without making declaration pursuant to this Act despite the fact that such goods are not subject to customs duty.
(f) “Import smuggling” means the importation into Nepal of any goods subject to customs duty without payment of such duty or clandestinely or through illicit routes or without making declaration pursuant to this Act despite the fact that such goods are not subject to customs duty.
(g) “Examination” means the examination by the Customs Office of any goods to be exported or imported or documents related with such goods or of both in order to ascertain whether such goods are accordingly as declared, and this expression also includes the search or x-ray of the body or any passenger entering into Nepal from a foreign country or departing from Nepal to a foreign country.
(h) “Elearance” means the permission given by the Customs Officer to export or import or remove any goods from the Customs Office pursuant to this Act and the Rules framed under this Act.
(i) ” Post clearance audit” means the audit referred to in Section 34.
(j) “Prescribed” or “as prescribed” means prescribed or as prescribed in the Rules framed under this Act.
(k) “Export” means the act of taking of goods out of Nepal to a foreign country.
(l) “Declaration form” means the form in which an exporter or importer declares the details of goods to be exported or imported.
(m) “Import” means the act of bringing of goods into Nepal from a foreign country.
(n) “Bonded warehouse” means a warehouse licensed by the Department to import and hold, against the bank guarantee facility, such raw materials or subsidiamanufacture goods to be exported to foreign countries or to be sold domestically at convertible foreign currencies or such goods as to be sold at a duty free shop.
(o) “Bank” means a commercial bank or financial institution licensed to carry on banking transactions pursuant to the prevailing law.
(p) “Bank guarantee” means the guarantee given by a bank to the Customs Office against payment by itself of duty payable by any exporter or importer in exporting or importing any goods in the event of failure of such exporter or importer to pay such duty.
(q) “Cank guarantee facility” means a facility accorded to any exporter or importer to export or import any goods on the basis of bank guarantee.
(r) “Customs Officer” means the Chief Customs Administrator, Chief Customs Officer or Customs Officer, and this
expression includes the Chief of Sub-customs Office and the Official designated by the Ministry of Finance pursuant to Section 84.
(s) “Customs agent” means the licensee as referred to in Section
(t) “Customs Office” means the Customs Office established by the Government of Nepal pursuant to Section 4, and this expression includes the premises of such Customs Office and such other area as may be prescribed by the Government of Nepal by notification in the Nepal Gazette.
(u) “Customs godown” means a house, building, shed or similar other structure built in a Customs Office or any place for holding goods to be exported or imported.
(v) “Customs duty” means customs duty chargeable on goods to be exported or imported in accordance with laws.
(w) “Customs value” means such value of goods to be exported or imported as may be determined in accordance with the provisions of Section 13 or 16 for the purpose of determining customs duty.
(x) “Customs area” means the customs area prescribed by the Government of Nepal pursuant to Section 3.
(y) “Duty” means each tax, charge and fee chargeable on goods to be exported or imported in accordance with law, and this expression includes customs duty.
(z) “Duty facility” means such facility as to allow the exportation or importation of any goods keeping only books of record, without collecting duty, whether or not examining such
goods.
(aa) “Director General” means the Director General of the
Department of Customs.
(bb) “Goods” means any kind of movable goods or property
including currency.
(cc) “Person” means a natural person, and this expression includes
any company, corporate body and firm registered pursuant to
law.
(dd) “Department” means the Department of Customs.
(ee) “Demurrage” means the charge payable to the Government of Nepal by the exporter or importer of goods if such exporter or importer fails to take delivery of such goods stored at the customs godown run by the Customs Office within the prescribed time limit.
(ff) “Motor vehicle” means any conveyance to be used or used to make travel or transport goods.

Chapter -2

Chapter -2

Provisions relating to Customs Area and Customs Office
3. Power to prescribe customs area and route :

(1) The Government of Nepal may, by notification in the Nepal Gazette, prescribe any area of Nepal as the customs area for the purpose of administering the laws relating to customs and collecting customs duty in accordance with this Act.
(2) The Government of Nepal may, by notification in the Nepal Gazette, prescribe routes through which export from or import into Nepal is to be made through the customs area as referred to in Sub-section (1).
(3) Any goods to be exported from Nepal or imported into Nepal shall be exported or imported only through the routes as referred to in Sub-section (2).
(4) The Director General may, subject to Sub-section (3), so prescribe that the goods of any specific nature can be exported or imported only through any specific customs office.
(5) Notwithstanding anything contained elsewhere in this Act, the Director General may so prescribe that the goods as prescribed or the goods up to the value as prescribed can be exported or imported through a sub-customs office.

4. Establishment of Customs Office : The Government of Nepal may, by notification in the Nepal Gazette, establish a Customs Office or Sub-customs Office in any customs area.

Chapter-3

Chapter-3

Provisions relating to Customs Duty

5. Customs duty to be charged: Customs duty shall be chargeable on all goods to be exported or imported except those goods which enjoy customs duty exemption pursuant to this Act or the prevailing law.

6. Duty to be levied in event of re-import of exported goods :

(1) If any person re-imports any goods which have been manufactured or finished in Nepal and exported, such goods shall be subject to such duty as is chargeable on the importation of the goods of similar kind or to the same value, which have been manufactured or finished in a foreign country.
(2) Notwithstanding anything contained in Sub-section (1), no customs duty shall be charged on the goods which have been returned back as follows:
(a) Having been exported through parcel by post but could not be delivered to the concerned person and thus returned back, or
(b) Having been returned back because the concerned person has refused to take delivery after clearance made by the Customs Office or after having arrived abroad, or
(c) Having been returned back because of being unable to meet standard quality due to an accident or natural calamity.
(3) Where the raw materials and subsidiary raw materials of the goods returned back pursuant to Sub-section (1) were imported without paying duty, the duty chargeable on the quantity of the raw materials or subsidiary raw materials used in such goods shall also be recovered.

7. Duty not to be charged on goods left in customs office :

(1) If any importer makes an application for not releasing any goods imported by that importer and for so leaving such goods with the Customs Office that they belong to the Government of Nepal, no duty shall be charged on such goods.
(2) The Government of Nepal may itself use the goods so left pursuant to Sub-section (1) or auction them in accordance with this Act. Provided that where such goods are in such a condition that they can neither be brought into use nor be auctioned, the Customs Officer may remove such goods from the Customs Office or destroy them as prescribed; and the expenses incurred in such removal or destroy shall be recovered from the concerned importer himself / herself.

8. Base date for determination of duty :

(1) The duty of any goods to be exported or imported shall be determined according to the tariff (rate of duty) prevailing on the date on which the declaration form of such goods is registered in the Customs Office. Provided that where the declaration form has been registered in the Customs Office prior to the arrival of goods at the Customs Office, the duty shall be determined according to the tariff prevailing on the date of arrival of such goods at that Office.
(2) Notwithstanding anything contained in Sub-section (1), the duty of the following goods shall be determined on the following basis:
(a) In the case of goods imported under the diplomatic facility, duty facility or partial or full exemption, according to the tariff prevailing on the date of payment of duty of such goods,
(b) In the case of goods imported under the bank guarantee facility, according to the tariff prevailing on the date of clearance of such goods

Chapter-4

Chapter-4

Provisions Relating to Customs Duty Facility, Exemption and Other Facilities

9. Diplomatic facility, duty facility and customs duty exemption :

(1) Diplomatic facility or duty facility shall, on recommendation of the Ministry of Foreign Affairs, Government of Nepal, be accorded, as prescribed, to those bodies, officials or persons who are entitled to enjoy such diplomatic facility or duty facility under any bilateral or multilateral treaty or agreement to which Nepal is a party.
(2) The Government of Nepal may, from time to time and by notification in the Nepal Gazette, accord the diplomatic facility or duty facility to such goods to be imported by such persons or bodies as specified in that notification.
(3) The Government of Nepal may, from time to time and by notification in the Nepal Gazette, accord partial or full customs duty exemption to the goods specified in that notification.
(4) The Government of Nepal may accord partial or full customs duty exemption to the goods to be imported in the name of any project to be operated under foreign loan or grant assistance or in the name of the contractor of such project.
(5) The Government of Nepal may accord partial or full customs duty exemption to the fuel to be consumed during international flight, engine of aircraft, spare parts, machine, equipment thereof, food, liquors, beer and light drinks consumed in flight by an international air service company.
(6) The provisions for according the duty facility to any goods to be brought again into Nepal from any part of Nepal via any abroad route shall be as prescribed.
(7) The provisions for according the duty facility to any goods to be sent again to a foreign country from the foreign country via Nepal shall be as prescribed.

10. Power to accord bonded warehouse facility : The Government of Nepal may, if it considers appropriate to accord the bonded warehouse facility to any person desirous of availing of the bonded warehouse facility, so accord the facility, as prescribed, that the bonded warehouse is operated subject to the terms as prescribed.

11. Power to accord facility to make import under bank guarantee facility :

(1) The Government of Nepal may accord to any person the facility to import any goods under the bank guarantee facility in such manner as prescribed.
(2) The Government of Nepal may accord the facility, as prescribed, to import under the bank guarantee facility, in accordance with the prescribed terms, such raw materials or subsidiary raw materials as to be
imported by any industry for the purpose of manufacturing goods and export them or such goods as are imported for the operation of a duty free shop.
(3) In according the facility to make import pursuant to Sub- section (2), the concerned Customs Office shall take bank guarantee of the duty chargeable for such importation as well as such other duty, fee or penalty as may be chargeable or imposed on him/her in the event of violation of the terms referred to in Sub-section (2).

12. Power of Government of Nepal to accord customs duty exemption and other facility to goods to be exported and imported by industry situated in Special Economic Zone:

( 1) The Government of Nepal shall accord customs duty exemption and other facility against bank guarantee to the following goods to be exported and imported by any industry situated in the special economic zone:
(a) Such raw materials, subsidiary raw materials as required to manufacture finished products to be exported, packing materials and other materials to be used in manufacturing,
(b) Plants, machineries, machines, equipment, tools and spare parts as required for the industry, and up to three motor vehicles based on the size and nature of industry; Explanation: For the purpose of this Section, “special economic zone” means a zone specified as a special economic zone by the Government of Nepal through notification in the Nepal Gazette.
(2) If any importer sells, as prescribed, any goods which that importer has imported to any industry situated in the special economic zone and that importer has paid the customs duty for importing such goods, the Customs Office shall refund, as prescribed, such customs duty to that importer.
(3) If any industry situated outside the special economic zone sells any finished products manufactured by that industry to any industry situated within the special economic zone, such customs duty and other facility as is accorded in the event of export shall be accorded as if that sale were an export.
(4) If an industry situated within the Special Economic Zone so sells any goods manufactured from the raw materials imported under the customs duty exemption that such goods are consumed in Nepal, such goods shall be allowed to be taken out of the special economic zone only after payment of duty chargeable on the raw materials used in such goods.

(5) The Government of Nepal may, by notification in the Nepal Gazette, issue an order specifying the procedures on the transfer by an industry situated within the special economic zone of the ownership of goods imported under duty exemption to any person within or outside the special economic zone. It shall be the duty of the concerned industry to abide by such order.

Chapter-5

Chapter-5

Provisions Relating to Determination of Customs Value

13. Bases for determination of customs value of goods to be imported :

(1) The rules on customs valuation, annexes and explanatory notes set forth in the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 shall be pursued in determining the customs value of imported goods.
(2) The customs value of goods to be imported shall be determined on the basis of the transaction value of such goods, subject to Sub-section (1).
(3) The importer shall declare the transaction value, attaching therewith the description and documents proving the value of goods imported..
(4) If the transaction value declared by the importer pursuant to Sub-section (3) is in conformity with Sub-section (1), the Customs Officer shall determine the customs value of the goods on the basis of such transaction value. If such transaction value does not appear to include freight, insurance and other related expenses, the Customs Officer
shall determine the transaction value by adding an estimated amount likely to be incurred for the same.
(5) The Director General may prescribe bases for fixing the estimated amount referred to in Sub-section (4).
(6) If there is a reasonable ground to believe that the value declared by the importer pursuant to Sub-section (3) is doubtful, the Customs Officer may ask the importer to produce additional documents or
evidence in writing to prove that such value is the actual transaction value. It shall be the responsibility of such importer to provide documents so asked.
(7) If the customs value of any goods cannot be determined on the basis of the transaction value declared by the importer pursuant to Sub- section (3) or the bills, invoices and documents submitted by the importer, the Customs Officer shall give a notice, accompanied by the reason for the same, to the concerned importer.
(8) If the customs value cannot be determined on the basis of the transaction value pursuant to Sub-section (2), the customs duty of such goods shall be determined on the basis of the transaction value of identical goods already imported into Nepal prior to the import of such goods. Explanation: For the purposes of this Section, “identical goods” means goods which are the same in all respects, including physical characteristics, quality and reputation.
(9) If the customs value cannot be determined on the basis of the transaction value of identical goods pursuant to sub-section(8), the customs duty of such goods shall be determined on the basis of the transaction value of similar goods already imported into Nepal prior to the import of such goods. Explanation: For the purposes of this Section, “similar goods” means goods which, although not alike in all respects, have like characteristics and like component materials which enable them to perform the same functions and to be commercially interchangeable.
(10) If the customs value cannot be determined on the basis of the transaction value of similar goods pursuant to Sub-section (9) and such goods have already been imported into Nepal and sold at market to a person who is not related to the importer, the customs value of such goods shall be determined on the basis of deductive value method, by deducting the tax, duty levied in Nepal on the selling price of each unit of the maximum unit so sold, and other related costs and profits.
(11) If the customs value cannot be determined pursuant to sub- section (10), the customs value shall be determined on the basis of computed value method, also calculating the costs incurred in the production or manufacturing of such goods and profits made or likely to be made by the seller while selling such goods to the importer.
(12) If the customs value cannot be determined pursuant to sub- section (11), the Customs Officer shall so determine the customs value of such goods on a reasonable basis as not to be contrary to the provisions of sub-sections (2), (8), (9) and (10).
(13) Notwithstanding anything contained in sub-sections (10) and (11), if the importer makes a request for the determination of customs value by adopting the procedures set forth in Sub-section (11) prior to adopting the procedures set forth in Sub- section (10), the Customs Officer may determine the customs value in accordance with the provisions of Sub-section (11).
(14) Notwithstanding anything contained elsewhere in this Section, if the owner of the goods imported under the Luggage and Baggage Order for personal purposes or the goods received as a gift or specimen/model and imported from a foreign country makes an application for the valuation of such goods, showing the reason for failure to indicate the transaction value thereof and if the Customs Officer considers the matter to be appropriate, he or she may determine a reasonable customs value of such goods.
(15) If the value declared by an importer pursuant to Sub-section (3) is less than the customs value determined by the Customs Officer pursuant to this Section, the Customs Officer may do the following in relation to such goods:
(a) Clearing such goods by collecting fifty percent additional customs duty on such difference value, or
(b) With the prior approval of the Director General, purchasing, or causing to be purchased, such goods in a manner to pay the amount to be set by adding five percent amount to the value so declared to the importer.
(16) In determining the customs value of goods in accordance with the provisions of this Section, the customs value shall normally be determined in a foreign currency. Where the valuation of goods on which the duty has to be paid at the time of import is made in a foreign currency, the conversion of such currency into Nepalese rupees shall be made according to the selling rate of foreign currency which is prescribed by the Nepal Rastra Bank and prevailing on the day of customs clearance of such goods. In the case of a foreign currency of which exchange rate is not prescribed by the Nepal Rastra Bank, such foreign currency shall be converted into American dollars, and the selling rate of American dollars shall be taken as the basis. Provided that in converting the customs value of the goods of which duty is paid subsequent to the importation thereof under the diplomatic facility, duty facility or full or partial exemption of duty, such conversion shall be made according to the selling rate of foreign currency which is prescribed by the Nepal Rastra Bank and prevailing on the day of payment of the remaining duty.

14. Power to determine customs value provisionally :

(1) Notwithstanding anything contained elsewhere in this Act, the Customs Officer may, subject to Section 13, determine a reasonable provisional customs value of imported goods if:
(a) The importer makes an application, along with a reasonable grownds, that he or she is not able to forthwith
provide necessary documents and other related information as required for the valuation of goods,
(b) the customs value has to be or can be determined only after carrying out the laboratory test or other examination of goods or there appears a need to make further inquiry into the documents and information provided by the importer.
(2) Where, after the determination of provisional customs value in accordance with the provisions of Sub-section (1), the importer wishes to clear the goods by furnishing a deposit of the duty chargeable on such goods, the Customs Officer shall make clearance of such goods.
(3) The Customs Officer shall determine the customs value of the goods under the provisions of Section 13 no later than thirty days after the date of determination of the provisional value pursuant to Sub-section (1).
(4) If the customs value determined pursuant to Sub-section (3) is more than the provisional customs value determined pursuant to Sub-section
(1), the Customs Office shall recover from such importer the duty chargeable on such excess value, and if it is less than that, the duty collected in excess shall be refunded to the importer.

15. Power to fix estimated amount of freight, insurance or other related costs :

(1) Where, owing to a circumstance beyond his or her control, an importer is not able to forthwith submit documents of cost, insurance or related costs incurred in the importation of any goods, the importer may submit an application, accompanied by the reason for the same, to the Customs Officer for the fixation of the estimated amount of such freight, insurance or other related expenses.
(2) Where, in inquiring into the application referred to in sub- section
(1), the contents appear to be reasonable, the Customs Officer may fix the estimated amount for freight, insurance or other related expenses likely to be included in the transaction value of such goods.
(3) The concerned importer shall submit documents and evidence relating to the actual freight, insurance and other related expenses no later than ninety days after the date of fixation of the estimated amount of freight, insurance or other related costs pursuant to Sub-section (2). If the amount set forth in the documents and evidence so submitted is more than the estimated amount fixed pursuant to Sub-section (2), the importer shall pay the duty chargeable on such excess value, and if it is less than that, the Customs Office shall refund the remaining amount, upon deduction of the chargeable duty, to the importer.
(4) Where the concerned importer fails to submit documents and evidence within the period referred to in Sub-section (3) or unless it is proved otherwise, the estimated amount fixed by the Customs Officer pursuant to Sub-section (2) shall be considered as the final amount of such freight, insurance or other related costs.

16. Determination of customs value of goods to be exported :

(1) The invoice value declared by an exporter shall be the customs value of the goods to be exported.
(2) Notwithstanding anything contained in Sub-section (1), the Government of Nepal may, if considers necessary, determine separate customs value of any goods of specific nature to be exported, by notification in the Nepal Gazette. Where separate customs value is so determined, the customs value of such goods shall be the invoice value declared by the exporter or the customs value so determined by the Government of Nepal, whichever is higher.
(3) The customs value referred to in Sub-section (1) or (2) shall be the free on board (FOB) value. Explanation: For the purposes of this sub-section, “free on board (FOB) value” means a value which includes the factory price of the goods to be exported and costs incurred in Transportation of such goods up to the concerned Customs Office of Nepal. (4) The value of goods to be determined pursuant to this Section shall be determined in foreign currency. Such foreign currency shall be converted into the Nepalese rupees according to the buying rate of foreign currency which is prescribed by Nepal Rastra Bank and prevailing on the day of clearance of such goods.

Chapter-6

Chapter-6

Provisions Relating to Declaration Form, Examination and Clearance

17. Details to be submitted : The driver of a motor vehicle transporting any goods to be exported or imported shall provide such details of goods held in the vehicle as may be prescribed to the Customs Officer before such vehicle enter into the Customs Office.

18. Declaration form to be filled up and submitted :

(1) Any person who exports or imports any goods shall fill up the declaration form, accompanied by the documents as prescribed, and submit it to the Customs Officer of the concerned area. Provided that, it shall not be necessary to fill up the declaration form in the case of those goods which have been exempted from customs duty by the Government of Nepal by notification in the Nepal Gazette, out of the goods contained in the luggage and baggage of passengers going out from Nepal and coming into from foreign countries.
(2) In the event that, owing to the occurrence of a circumstance beyond control or any other reasonable reason, the concerned person is not able to submit any document as referred to in Sub-section (1) along with the
declaration form, such person may make an application, showing such circumstance or reason, to the Customs Officer for permission to submit such document later.
(3) Where, upon examination of the application made pursuant to Sub- section (2), such circumstance or reason appears to be reasonable, the concerned Customs Officer may prescribe the period within which such document has to be submitted.
(4) While prescribing the period for the submission of document pursuant to Sub-section (3), the Customs Officer may prescribe any terms or ask for a reasonable deposit for security.

19. Examination of declaration form :

(1) After the submission of a declaration form pursuant to Section 18, the concerned Customs Officer shall examine as to whether the goods declared in the declaration form are exportable or importable under law. While carrying out such examination, the Customs Officer may, as required, carry out or cause to be carried out physical inspection of the concerned goods.
(2) If, in carrying out examination pursuant to Sub-section (1), such goods are found to be non-exportable or non- importable or restricted ones, the matter shall be referred to the concerned body or authority for investigation or action under the prevailing laws.

20. Examination of goods :

(1) If, in carrying out examination pursuant to Section 19, the concerned goods are found to be exportable or importable, the Customs Officer shall examine such goods in accordance with the provisions contained in Chapter-7.(2) Notwithstanding anything contained in Sub-section (1), if it is not required to examine such goods in accordance with the selective method, the Customs Officer may examine the related documents only. Explanation: For the purposes of this Section, “selective method” means a system so determined by the Department that any goods can be cleared, with or without examining such goods, or by examining documents only, taking into account the risks of revenue, trade, goods or other activities.

21. Valuation to be made : After the examination of goods or documents pursuant to Section 20, the Customs Officer shall determine the customs value of the goods to be imported and of the goods to be exported under the provisions of Sections 13 and 16, respectively.

22. Determination of duty : After the determination of the customs value pursuant to Section 21, the Customs Officer shall determine the duty chargeable on the goods.

23. Clearance of goods : Except where exemption from or facility granting waiver of the duty is provided under the prevailing laws, the Customs Officer shall make clearance of goods only upon collecting the duty determined pursuant to Section 22.

24. Determination of duty prior to arrival of goods at Customs Office :

(1) If any importer wishes to pay the duty chargeable on any goods to be imported by the importer prior to the arrival of such goods at the concerned Customs Office, the importer may, for that purpose, make an application, accompanied by the declaration form filled up and such documents relating to such goods as referred to in Section 18, to the Customs Officer.
(2) If, on examination of the application received pursuant to Sub-section (1), it appears reasonable to so collect the duty, the Customs Officer may determine the duty pursuant to Section 22. The importer shall pay the duty so determined to the Customs Office.
(3) If the rate of duty determined pursuant to Sub-section (2) or the exchange rate of convertible foreign currency prevailing on the day of payment of duty differs from that prevailing on the day of clearance of goods, the rate prevailing on the day of clearance of goods shall be applied.
(4) After those goods in respect whereof the duty has been paid pursuant to Sub-section (2) have arrived at the Customs Office, the Office shall complete necessary procedures and make clearance of such goods with priority.

25. Export or import to be made :

(1) The exporter or importer of any goods to be exported or imported or his or her customs agent may export or import such goods only after the declaration form or a receipt of payment of the duty pursuant to Section 23 has been received, and after the Customs Officer has given permission to clear the goods upon making, or causing to be made, examination thereof, in the case of the goods mentioned in the proviso to Sub-section (1) of Section 18.
(2) If any person exports software through electronic means, such software shall be deemed to have been exported only after certification by the Nepal Rastra Bank, on the basis of, inter alia, the agreement relating to export, invoice and the evidence of payment made by the concerned importer.

26. Power to ask for proof, evidence or receipt :

(1) Where there is a reasonable ground to believe that any person has imported or is going to export any goods and has not paid the customs duty or it is known that the customs duty has not been paid, any employee of the Customs Office may ask such person to furnish an evidence showing the payment of customs duty of such goods or proof of the exemption of such goods from customs duty in the event of such exemption.
(2) Such person shall show the evidence or proof asked pursuant to Sub-section (1) to such employee. If that person fails to furnish such evidence or proof or if the proof submitted shows that the goods are not the same as mentioned in the proof, such employee shall produce such goods and person before the Customs Officer.
(3) The Customs Officer may, upon production made pursuant to Sub-section (2), issue an order to withhold such goods and shall take action against the person so produced on the offense of export or import smuggling.

27. Format of declaration form : The format of declaration form shall be as prescribed.

Chapter-7

Chapter-7

Provisions Relating to Examination of Goods

28. Power to open and examine consignment or packet :

(1) The Customs Officer may open and examine, or give order to any of his or her sub- ordinate employees to open and examine, each and every consignment or packet of any goods whatsoever to be exported or imported or open and examine them randomly and casually or open and examine only a certain percentage of the same.
(2) In making examination pursuant to Sub-section (1), the examination of living animals, perishable goods and such other goods as the Customs Officer considers necessary shall be made first.
(3) Where the Customs Officer or his or her sub-ordinate employee has opened and examined the consignment or packets of goods pursuant to Sub-section (1), the method of such examination and a clear description of the items so examined shall be set down in the declaration form.
(4) If there is a suspicion about any consignment or packet examined or not examined under this Section or any
information is received about the same, the Customs Officer shall give order to any of his or her sub-ordinates to examine such consignment or packet if it has not been examined or to re-examine the same if it has already been examined..
(5) If any exporter or importer wishes to get the goods examined in his or her presence, that exporter or importer shall give information thereof in writing to the Customs Officer. Where information is so given, the Customs Officer may examine or cause to be examined the goods in presence of such exporter or importer. Provided that if such exporter or importer is not present at the time specified by the Customs Officer, nothing shall bar the examining of goods in the absence of such exporter or importer.
(6) While examining or causing examination pursuant to this Section, the Customs Officer may examine or cause examination only upon collection of the duty chargeable on the basis of declaration.
(7) Where, in making examination pursuant to Sub-section (6), the goods are not found the same as those set down in the declaration made by the exporter or importer or his or her agent or in the document attached with the declaration form, the importer shall not be entitled to get refund of the duty or to reconcile or adjust it with the chargeable duty if the duty has been collected prior to the examination of such goods.
(8) Prior to taking delivery of the goods once cleared from the customs area or after taking them outside the customs area, any officer deputed by the Director General or the Customs Officer of the concerned Customs Office may re-examine, or cause to be re-examined, such goods wholly or partly. While making such re-examination, the Director General or the Customs Officer shall provide information of the reason for such re- examination to the concerned importer

29. Deemed examination : If, while examining any consignment or packet pursuant to Section 28, the goods held in the consignment or packet are found to be conforming to the submitted bills, invoices, other documents or details, the goods in the other consignments or packets which have not been examined shall also be deemed to have been examined.
30. Special test of goods :

(1) If it is required to subject any goods to a special test from the health or environmental perspective, the Customs Officer may get such goods tested by the concerned body or laboratory.
(2) For the purpose of Sub-section (1), the Customs Officer may take a specimen of such goods from the consignment or packet and send it to the concerned body or laboratory.
(3) The concerned authority or laboratory shall promptly test the goods sent for test pursuant to Sub-section (1) and send results thereof to the Customs Office promptly.
(4) If, in carrying out test pursuant to Sub-section (3), the goods appear to cause adverse effects or damage to the environment or health, the Customs Officer shall order the concerned importer to return such goods back to the concerned exporter of the foreign country, in such manner as prescribed. Provided that, prior to making such order, the Customs Officer may ask the importer to submit an evidence showing the refund of foreign currency paid for such goods or a bond covenanting to have refund of such foreign currency.
(5) If the concerned importer does not send back such goods pursuant to the order issued under Sub-section (4), the Customs Officer may seizure and destroy or decompose such goods and shall recover from the concerned importer the expenses incurred or likely to be incurred in such destroy or decomposition.

31. Power to visit and examine goods in the concerned place :

(1) An exporter may submit an application to the Customs Officer to visit the production site or go down of any goods to be exported by the exporter and examine such goods.
(2) If it appears to make examination of the goods as per the application received pursuant to Sub-section (1), the Customs Officer may visit such production site or go down on his or her own and examine such goods or send any of his or her sub-ordinate employee to such site or go down for such examination, by collecting the fees as prescribed.
(3) An importer may submit an application, accompanied by the prescribed documents and the declaration form filled up, to the Customs Officer for the examination of the goods imported by the importer outside the customs area.
(4) If, upon inquiring into the application received pursuant to Sub-
section (3), it appears reasonable to make such examination, the Customs Officer may, by obtaining prior approval of the Director General, visit the site outside the customs area on his or her own and examine the goods
or send any of his or her sub-ordinate employee for such examination, by collecting the fees as prescribed.
(5) Prior to making examination pursuant to Sub-section (4), the Customs Officer shall take a deposit of an amount to be set by adding fifty per cent duty to the duty chargeable on the goods according to the customs value
declared by the importer. The Customs Office shall refund the excess amount to the importer if such deposit is more than the customs duty chargeable on such goods and recover from the importer the shortfall amount if such deposit is less such customs duty.

32. Power to seal means of transport : After the clearance of goods by the Customs Office, such goods may be kept in the means of transport which is to be used for transporting them, and the Customs Office may seal such means of transport.

33. Prohibition on opening, inspection and examination : No body other than the authority authorized to make investigation under the prevailing laws on revenue leakage shall, without prior approval of the Ministry of Finance or the Director General, open, inspect and examine any goods cleared by the Customs Office and any means transporting such goods.

Chapter-8

Chapter-8

Provisions Relating to Post Clearance Audit, Search and Arrest

34. Power to make post clearance audit :

(1) In order to ascertain whether the goods cleared by the Customs Office are the same as declared by an importer or confirm to the declaration made by the importer or not, the Director General or Customs Officer may audit, inter alia, the importer’s books relating to the purchase, import or sale of goods, records, books of accounts or similar other documents, bank records, computer system and all records related to his or her business.
(2) If, upon audit made pursuant to Sub-section (1), it is found that the goods imported by the importer are different than those declared by the importer or are inconsistent with the declaration made by the importer or the transaction value or the quantity of the goods has been declared less and by virtue thereof lesser duty has been recovered, the Customs Officer shall immediately recover from the importer the duty chargeable on such less value or quantity at the time of import and take action against such importer for the declaration of less transaction value or quantity,
pursuant to this Act.
(3) If, upon audit made pursuant to Sub-section (1), it appears that less duty has been recovered by the reason of difference in sub-heading of commodity classification, the concerned Customs Office shall immediately recover such shortfall amount of duty from the importer.
(4) The audit referred to in this Section may be made until four years after the date of clearance of goods.

35. Goods and persons to be produced before Customs Officer : If any employee of the Customs Office or authority deputed by the Director General finds that any person has exported or imported any goods through any route
other than the route prescribed pursuant to Section 3 or smuggled the goods or is going to make such export or import, such employee or authority shall capture such goods and the person and motor vehicle carrying such goods and produce them before the Customs Officer. The Customs Officer shall institute action against and in relation to the goods, person and motor vehicle so produced on the offense of export smuggling or import smuggling.

36. To make search on suspicion or ground : If there is a reasonable ground or reason to believe that or there is a suspicion that any person has brought any goods subject to customs duty without paying such duty or smuggled and
imported such goods or is going to smuggle and export such goods or has exported or imported or is going to export or import any restricted goods, any employee of the Customs Office may, at any time, stop such person or any motor vehicle and search such person or motor vehicle.

37. Person to be searched may request to produce before Customs Officer:
(1) Where any employee other than the Customs Officer or the employee designated for that purpose intends to make search ursuant to Section 36, the concerned person may request to produce him/her before the Customs Officer prior to making such search.
(2) Where request for presence before the Customs Officer pursuant to Sub-section (1), the employee of the concerned Customs Office
shall produce him or her before the Customs Officer promptly.
(3) Where the Customs Officer has a reasonable ground to search the person produced pursuant to Sub-section (2), custom officer may search such person or cause any of his or her subordinate employees to make such search, and where the Customs Officer does not see such ground, he or she shall release such person immediately.

38. Import smuggling or export smuggling to be deemed : Where, upon making a search pursuant to Section 36 or 39, any goods which are subject to the customs duty or which have to be exported or imported by making declaration pursuant to this Act are seized, the Customs Officer shall give order to the person searched to submit the declaration form of such goods and evidence of payment of duty if such goods are those which are subject to customs duty. In the event of failure to submit such declaration or evidence, such person shall be deemed to have committed export smuggling or import smuggling.

39. To search house, building, godown or place :

(1) Where there is a reasonable ground to believe or doubt that any person has hidden or kept any goods brought into by evading the customs duty or by way of import smuggling in any house, building, go down or other place, the Director General or the concerned Customs Officer may make decision, accompanied by the reason, and search such house, building, go down or place or give order to make such search.
(2) The employee who gets order pursuant to Sub-section (1) shall, prior to searching such house, building, godown or place, give a notice, accompanied by the reason for making such search, to the owner of that house, building, godown or place or the person who are residing in such house, building, godown or place for the time being. If such owner or person refuses to acknowledge such notice, a copy of the notice shall be affixed to such house, building, godown or place in a manner conspicuous to all; and after the notice is so affixed, the concerned owner or person shall be deemed to have duly received the notice of search.
(3) After the notice has been given to the concerned owner or person pursuant to Sub-section (2), such owner or person shall allow the employee deputed to make search of such house, building, godown or place.
(4) If any person makes any obstruction or objection to making search pursuant to Sub-sections (2) and (3), the employee deputed to make search shall give a notice and opportunity to the persons who are staying in the house, building, godown or place to be searched to leave such house, building, godown or place. If such persons do not leave in spite of such notice and opportunity, such employee may search the house, building, godown or place required to be searched at any time between sunrise and sunset by opening or breaking the external or internal door, window or locker thereof also by using necessary force with the assistance of the security body.
(5) In making search pursuant to this Section, the employee deputed to make search shall, to the extent of availability, make search in witness of the ward chairperson or ward member of the concerned Village
Development Committee or Municipality or an employee of any office or house owner or his or her agent or any person having attained the age of sixteen years. If no such person is found to witness the search or such person
refuses to witness the same, the person making search shall execute a memo of remarks to that effect and sign it.
(6) If, on making search pursuant to this Section, any goods brought by evading the customs or by way of import smuggling are seized, the employee making such search shall take such goods in his or her
custody, prepare an inventory indicating the details of such goods and deliver a copy of the inventory to the concerned person of the house, building, godown or place searched immediately. If the concerned person refuses to
receive such copy or if it is not possible to deliver it to such person, that copy shall be posted by executing a recognizance deed in witness of two witnesses. If the copy of inventory is so posted, it shall be deemed to have
been delivered to the concerned person.
(7) Such employee shall produce the goods and inventory as referred to in Sub-section (6) to the concerned Customs Officer; and upon such production, the Customs Officer shall take action under this Act.

40. Power to arrest : (1) Where, upon making a search pursuant to Section 36 or 39, any person is found to have committed any offence under this Act, the employee making such search may arrest, or cause to be arrested, such person.
(2) If there is a reasonable ground or reason to believe or doubt that any person is going to commit or has committed export smuggling or import smuggling or any act contrary to this Act, the concerned Customs Officer or any other employee of the Customs Office authorized by him or her may arrest, or cause to be arrested, such person in any motor vehicle or place.
(3) Any person arrested pursuant to Sub-section (1) or (2) shall be produced before the Customs Officer within twenty four hours excluding the time required for journey.
(4) The Customs Officer shall immediately take legal action against the person produced pursuant to Sub-section (3). Such person shall not be held in detention for more than twenty four hours without taking
such action.

41. Power to release on bail or detain :

(1) If any person produced pursuant to Sub-section (3) of Section 40 is found to be an offender based on the evidence available for the time being, the Customs Officer may release such person on bail which includes the amount for imprisonment and fine that can be imposed on such person pursuant to this Act and the amount equal to the amount in controversy where such amount is also to be recovered on the condition that such person shall make presence at the prescribed place and time.
(2) Any person who fails to furnish the bail demanded pursuant to Sub-section (1) shall be held in detention until such bail is furnished to the Customs Office.
(3) Notwithstanding anything contained in Sub-section (1), if there is a ground that such person may destroy evidence if he or she is released on bail, the Customs Officer may forward action by holding such person in detention, by assigning the reason for the same.
(4) Notwithstanding anything contained in Sub-section (2) or
(3), such person shall not be held in detention for a term that exceeds the maximum term of punishment that can be imposed on such person pursuant to this Act.
(5) While taking bail for punishment pursuant to Sub-section (1), it shall be taken by fifty rupees for one day of imprisonment.

42. Subsequent arrest of absconding person : If any person who commits any act that is considered an offence under this Act cannot be arrested at the time of commission of the offence or such person, despite being arrested, absconds, the Customs Officer or the employee authorized by him or her or the employee deputed for that purpose may arrest such person at any time. Action shall be taken against such person as if he or she were arrested at the time of commission of the offense.

43. Power to use maximum force:

(1) If any person attempts to export or import any goods through any route other than that prescribed pursuant to Section 3, the Customs Officer or the employee of the Customs Office authorized by him or her or the competent government employee may stop such person.
(2) If, while trying to stop such person pursuant to Sub-section (1), such person manhandles or uses force, the Customs Officer or such employee shall request and convince such person not to do so.
(3) If, despite the request and convincing pursuant to Sub-section (2), that person does manhandling or uses force, the Customs Officer or such employee may arrest him or her.
(4) If, while trying to make arrest pursuant to Sub-section (3), that person uses force or tries to escape or go away and cannot be arrested for the time being, the employee deputed for security on the spot may, by order
of such Customs Officer or competent authority for his or her security and for the observance of duties, first make an aerial firing and then open fire in such a manner as to cause a minimum of loss provided the situation cannot be
controlled despite such firing or the person using force has also a weapon.
(5) An employee of the Customs Office may order any person who makes movement by a motor vehicle through the route prescribed under Section 3 to stop, or cause to be stopped, such motor vehicle, as well. If such person
does not carry out such order but manhandles or uses force and attempts to take away or takes away such motor vehicle without getting it examined, the employee deputed for the security of customs may, by order of the Customs
Officer, open fire at the tyre of such motor vehicle in such a manner as to cause a minimum of loss.
(6) If it is necessary to open fire pursuant to Sub-section (4) and (5), the Customs Officer or the authorised person shall give by faster means the information of that matter to the Director General or the Concerned Chief District Officer

Chapter-9

Chapter-9

Provisions Relating to Seizure, Forfeiture and Auction of Goods

44. Power to seize goods liable to be forfeited : The Customs Officer or the employee of the Customs Office authorized by him or her or the employee authorized by the Government of Nepal may, if he or she sees or finds any goods liable to be forfeited pursuant to this Act, seize such goods at any place and time.

45. Proof of seizure to be provided : The Customs Officer or the employee who seizes goods pursuant to Section 44 shall provide a proof indicating the reason for so seizing the goods and an inventory setting out the details of goods so seized to the owner of such goods within a maximum of three days after the seizure of such goods.

46. Handing over of goods :

(1) Any employee of the Customs Office or other body shall promptly hand over the goods seized by that employee or body pursuant to Section 44 and a copy of the inventory referred to in Section 45 to the Customs Officer in accordance with this Act.
(2) After the goods have been handed over pursuant to sub- section (1), the Customs Officer shall inquire into whether such goods are liable to be seized under this Act. If, upon such inquiry, it appears either that such goods have been seized for no reason or that it is not necessary to seize such goods, the Customs Officer shall immediately return such goods to the owner thereof.
(3) If, upon making inquiry pursuant to Sub-section (2), it appears that the goods are liable to be seized, the Customs Officer shall take action as referred to in this Act in relation to such goods.

47. Ownership of goods seized and not cleared from customs belonging to Government of Nepal :

(1) Any goods which are seized under this Act shall belong to the Government of Nepal.
(2) The owner of goods concerned shall take delivery of the goods held in customs within the prescribed period.
(3) The concerned Customs Office shall publish a seven-day public notice for taking delivery of the goods which have not been cleared within the period referred to in Sub-section (2).
(4) If, after the publication of the notice referred to in sub- section (3), the owner of goods concerned makes an application, accompanied by a reasonable ground for not being able to clear the goods within the period referred to in Sub-section (2), to the Customs Office and such reason appears to be reasonable, the Customs Officer may, by
collecting the chargeable duty, permit the owner to clear such goods.
(5) The concerned Customs Officer shall forfeit the goods not cleared from the Customs Office even upon the publication of the notice as referred to in Sub-section (3). Such goods shall belong to the Government of Nepal.

48. Notice of forfeiture to be given : Where any goods are forfeited pursuant to this Act, the Customs Officer shall give information thereof to the concerned exporter or importer.

49. Goods to be forfeited : If a decision is made to forfeit any goods pursuant to this Act, the following goods related with such goods shall also be forfeited:
(a) Parcels, packets or containers to pack or transport such goods,
(b) All kinds of motor vehicles including, rickshaws, carts and animals, other than trains and aircrafts, used to transport such goods,
(c) Clothes, furniture, electronic goods and other materials held in motor vehicles referred to in clause (b).

50. Power to auction :

(1) Except where the Government of Nepal has itself used any goods which have been forfeited pursuant to this Act, the concerned Customs Officer may auction such goods as prescribed.
(2) Notwithstanding anything contained in Sub-section
(1), provisions relating to the auction of the gold, silver or bullions which have been forfeited and devolved on the Government of Nepal because of failure to clear them from the Customs Office or those goods which have been so forfeited and devolved and can be sold only after obtaining permission pursuant to the prevailing laws and other provisions pertaining thereto shall be as prescribed.
(3) If any goods forfeited pursuant to this Act are such that their value may diminish because of being perishable or old or it is difficult to keep them because of the lack of godown or space or in the case of animals, the Customs Officer may immediately auction such goods as prescribed.
(4) The Customs Office shall credit the proceeds of the auction referred to in Sub-section (3) to the deposit account.
(5) If it is held subsequently that those goods which have been auctioned pursuant to Sub-section (1), (2) or (3) are to be returned to the owner thereof, only the proceeds of such auction shall be returned to that owner. Provided that if any tax, charge or other fee or amount is chargeable on such proceeds, only the amount remaining after deducting such tax, charge, fee and amount shall be provided to the owner.
(6) If it is not appropriate to hold in the Customs Office any motor vehicle used to transport goods by way of export smuggling or import smuggling and produced before that Office because of the lack of space or being unable to protect it, the concerned Customs Officer shall get the value of such vehicle fixed by the prescribed committee and auction, or cause to be auctioned, such vehicle at that value.
(7) Notwithstanding anything contained in Sub-section (6), the owner of such motor vehicle may submit an application to clear that motor vehicle, by furnishing a cash deposit of the amount consisting of the value fixed
pursuant to sub-section
(6) as well as the amount to be set by adding the tax and charge chargeable on such value pursuant to the prevailing laws.
(8) Where an application is submitted pursuant to sub-section
(7), the Customs Officer may collect such deposit and return the motor vehicle to that owner; and if, on taking action on and disposing such application, the motor vehicle is held to be forfeited, the Customs Office may
credit the deposit so furnished into the revenue and return that motor vehicle to its owner. If it is decided that such motor vehicle is not liable to be forfeited and the owner of that vehicle is entitled to get it returned, the deposit furnished by that owner shall be refunded as prescribed.
(9) Notwithstanding anything contained elsewhere in this Section, the Customs Officer may decompose, decay or destroy, as prescribed, those goods which cannot be auctioned pursuant to this Act or which cannot be brought into use in any manner.

Chapter-10

Chapter-10

Provisions Relating to Customs Agent

51. Provisions relating to license of customs agent :

(1) A person who wishes to act as the customs agent or representative of any importer or exporter to clear goods to be imported or exported from the Customs Office or to do any act related with the Customs Office shall obtain the license of customs agent from the Department or Customs Office.
(2) The provisions relating to the license of customs agent shall be as prescribed.

52. Appointment of customs agent : If any exporter or importer wishes to get the goods to be exported or imported cleared not by himself or herself but through a customs agent or to do any act related with the Customs Office not by himself or herself but through a customs agent, such exporter or importer may appoint his or her customs agent as prescribed.

53. Customs agent to be deemed owner of goods : If the owner of any goods appoint any person as his or her customs agent to get such goods cleared from the Customs Office or to do any other act as referred to in this Act and the Rules framed under this Act, such customs agent shall, for that purpose, be deemed to be the owner of such goods.

54. Customs agent to be responsible : If any customs agent appointed pursuant to Section 52 does any act contrary to this Act or the Rules framed under this Act, thereby causing any loss and damage to the owner of goods, such agent shall pay an amount equal to that loss to the owner of such goods, as prescribed.

55. License to be suspended and canceled :

(1) The Customs Officer may suspend any customs agent on whom a fine is imposed pursuant to Section  or who does any act contrary to this Act or the Rules framed under this Act for a period from one month to six months.
(2) If any customs agent does the act referred to in Sub-section
(1) for the third time, the Customs Officer may cancel his or her license.
(3) Prior to suspending pursuant to Sub-section (1) or canceling the license pursuant to Sub-section (2), the concerned Officer shall give an opportunity to such customs agent to defend himself or herself.
(4) In the event of suspension pursuant to Sub-section (1), such customs agent shall not do any act relating to customs during the period of such suspension, and in the event of cancellation of license pursuant to Sub-section (2), such customs agent shall not be entitled to obtain the license of customs agent again.

56. Application : Where the Customs Officer makes decision to suspend or cancel the license of a customs agent or to impose a fine on him or her pursuant to Section 55, the customs agent who is not satisfied with that decision may file an application to the Director General within thirty five days after the date of such decision. The Director General shall make decision on such application normally within thirty days and such decision shall be final.

57. Punishment :

(1) If an person commits or attempts to commit export smuggling or import smuggling of any goods or exports or imports or attempts to export or import any goods through any route other than the route so prescribed under Section 3 that such goods are to be exported or imported only through that route, the Customs Officer may forfeit such goods and impose a fine equal to the amount in dispute of such goods or imprisonment as follows or both punishments:
(a) For a term not exceeding two months where the amount in controversy is from twenty five thousand to one hundred thousand rupees,
(b) For a term from two months to six months where the amount in controversy is from one hundred thousand
rupees to five hundred thousand rupees,
(c) For a term from four months to one year where the amount in controversy is from five hundred thousand rupees to two million five hundred thousand rupees,
(d) For a term from eight months to two years where the amount in controversy is from two million five hundred thousand rupees to five million rupees,
(e) For a term from one year to three years where the amount in controversy is from five million rupees to ten
million rupees,
(f) For a term from two years to five years where the amount in controversy exceeds ten million rupees.
(2) Where the motor vehicle used to transport the goods to be forfeited pursuant to Sub-section (1) has been used with the consent or knowledge of the owner of that motor vehicle, the Customs Officer shall forfeit such motor vehicle and punish the owner with imprison for a term not exceeding one year. Where the driver of such motor vehicle has knowingly used it to transport such goods without consent or knowledge of the owner of that motor vehicle, the Customs Officer may punish such driver with a fine of up to five thousand rupees or with imprison for a term not exceeding one year or with both punishments.
(3) The Customs Officer may punish any person who aids and abets the commission of offense referred to in Sub-section (1) as if such person were the offender.
(4) If an person hides or knowingly keeps any goods exported or imported by way of export or import smuggling, the Customs Officer may forfeit such goods and punish such person with a fine of up to ten thousand rupees.
(5) If an exporter, importer or customs agent make declaration with under invoicing despite that the name, nature, physical features, characteristics, measurement, size and quality of goods are accurate, the Customs Officer may clear such goods by imposing a fine of cent percent of the value of those goods which have been under-invoiced on the owner of such goods and collecting the chargeable duty.
(6) If an exporter, importer or customs agent makes declaration falsifying the country of origin despite that the name, nature, physical features, characteristics, measurement, size, quality and quantity of goods are accurate,
the Customs Officer may clear such goods by imposing a fine that is equal to the duty chargeable on such goods on the owner of such goods and collecting the chargeable duty.
(7) If an exporter or customs agent declares the quantity that exceeds the actual quantity of the goods to be exported, the Customs Officer may clear the goods by imposing a fine that is two hundred percent of the value
of goods so declared as excess and mentioning that fact in the declaration form.
(8) If an exporter or customs agent make declaration falsifying all or any details out of the name, nature, physical features, characteristics, measurement, size and quality of goods, the Customs Officer may forfeit such goods and impose a fine that is equal to the amount in controversy on the owner of such goods.
(9) If an importer or customs agent makes declaration falsifying the goods or the materials of which the goods are made or falsifying all or any details out of the nature, physical features, characteristics, measurement, size and quality of goods or does not make declaration of any goods, the Customs Officer may forfeit such goods by imposing a fine that is equal to the value of such goods on the owner of such goods or clear such goods by imposing a fine that is equal to two hundred percent of the value of such goods and collecting the chargeable duty.
(10) If an person causes or attempts to cause a loss of revenue or duty by submitting a forged, fake or false document to the Customs Office, the Customs Officer may punish such person with a fine that is two hundred percent of the amount of duty or revenue the loss of which has been so caused or attempted to be caused or with imprisonment for a term from six months to one year or with both punishments; and the matter shall be forwarded to the
concerned body or authority to take action under the prevailing laws in relation to the commission of forgery of governmental documents.
(11) If the owner of any goods or his or her agent opens in any manner any customs godown or goods stored in that godown with intention to steal goods or cause loss of or damage to such goods, the Customs Officer may punish such owner or agent with a fine not exceeding five thousand rupees.
(12) If an person removes or takes goods stored in a customs godwon from such godown without approval of the Customs Office, the Customs Officer may punish such person with a fine that is equal to the amount in controversy and with imprisonment for a term not exceeding six months or with both punishments.
(13) If an person knowingly writes, signs or uses the specific matter of the declaration form or document utilized in the performance of the functions of the Customs Office or forges or alters or destroys any document signed, stamped or sealed with initial, signed by or any sign or symbol affixed therein by the Customs Officer in the course of the performance of the functions of the Customs Office, the Customs Officer may punish such person with a fine not exceeding five thousand rupees and with imprisonment for a term not exceeding one year or with both punishments,
and the matter shall be forwarded to the concerned body or authority to take action under the prevailing laws in relation to the commission of forgery of governmental documents.
(14) If the person or employee who has the custody of the goods stored in the customs godown recklessly loses or knowingly damages such goods, the Customs Officer may punish such person or employee with a fine not exceeding five thousand rupees, by recovering from such person or employee the value of such goods and the chargeable duty.
(15) If an unauthorized employee removes or gives order to remove any goods stored in the customs godown, the Customs Officer may punish such employee with a fine not exceeding five thousand rupees or with imprisonment for a term not exceeding two years or with both punishments.
(16) If it appears, from the review carried out pursuant to Section 70, that there is a difference in the customs duty by the reason of submission by the owner of goods of fake bills, invoices or documents, the Customs Officer may punish such owner with a fine that is two hundred percent of the value of the goods cleared from the Customs Office or with
imprisonment for a term not exceeding one year or with both punishments.
(17) If an person commits any act contrary to this Act or the Rules framed under this Act, except that set forth in this Section, the Customs Officer may punish such person with a fine not exceeding five thousand rupees.

58. Punishment to those who cause obstruction : If an person deliberately obstructs or hinders the Customs Officer or any employee of the Customs Office in the exercise of the powers conferred by this Act and the Rules framed under this Act, the Customs Officer shall punish such person with a fine not exceeding five thousand rupees or with imprisonment for a term not exceeding one year or with both punishments, if such person is a governmental employee, and with a fine not exceeding one thousand rupees or with imprisonment for a term not exceeding six months or with both punishments if such person is not a governmental employee.

59. Punishment to customs agent:

(1) The Customs Officer may punish a customs agent who commits any act as referred to in sub-sections (5), (6), (7),
(8) and (9) of Section 57 with a fine from three thousand rupees to ten thousand rupees or with imprisonment for a term from one month to six months or with both punishments.

(2) The owner of goods shall not be deemed to have been released from punishment or fine imposable on him or her pursuant to this Section by the reason only that the customs agent has been subject to punishment pursuant to Sub-section (1).

60. Punishment to be imposable pursuant to prevailing laws : Where any offense or act under this Act is punishable under the prevailing laws, this Act shall not be deemed to bar the taking of action and imposing of punishment also under such laws.

Chapter-12

Chapter-12

Provisions Relating to Review and Appeal

61. Provisions relating to valuation review committee :

(1) A person who is not satisfied with any decision or order made by the Customs Officer pursuant to Section 13 may, for the review of such decision or order, file an application, as prescribed, to the valuation review committee formed
pursuant to Sub-section (2) no later than fifteen days after the date of such decision or order.
(2) For the purpose of Sub-section (1), the Government of Nepal shall form the following valuation review committee:
(a) At least Gazetted First Class officer of the Civil Service who has knowledge and experience in the field of revenue administration -Chairperson
(b) A person who is incumbent in the office of at least Gazetted Second Class and has
gained at least three years of experience in the Gazetted post on customs -Member administration or who has retired from the post of that Class and has gained the said experience
(c) A person who is incumbent in the office of at least Gazetted Second Class and has gained at least three years of experience in the Gazetted post on international trade -Member
(3) The term of the chairperson and members of the Valuation Review Committee referred to in Sub-section (2) shall be of three years.
(4) Notwithstanding anything contained in Sub-section (3), the Government of Nepal may, by providing an opportunity for defense, remove, at any time, the chairperson or any member of the Valuation Review Committee from the office on grounds of his or her incompetence or misbehavior or failure to discharge the duties of his or her office honestly.
(5) The Valuation Review Committee shall, while making review pursuant to this Section, inquire into whether the customs valuation determined by the Customs Officer pursuant to Section 13 is accurate or not and may approve or void the valuation determined by the Customs Officer or make valuation of such goods pursuant to this Act. The Valuation Review Committee shall also assign clear reasons and bases while so approving, voiding valuation or making valuation.
(6) The other functions, duties, powers and procedures of the Valuation Review Committee formed pursuant to Sub-section (2) and the remuneration and terms and conditions of service of the chairperson and member of that committee shall be as prescribed.
(7) A person who files an application pursuant to Sub-section (1) shall, prior to making such application, furnish with the Customs Officer a deposit of the duty chargeable according to the valuation determined by the Customs Officer pursuant to Section 13.

62. Appeal :

(1) A person who is not satisfied with the customs duty determined by the Customs Officer or other employee under this Act or with any order or punishment or decision issued or made by the Customs Officer, except any decision or order referred to in Section 13, or with any decision made by the Valuation Review Committee formed pursuant to Section 61 may make an appeal to the Revenue Tribunal within thirty five days after the date of the determination of such customs duty or the imposition of punishment or the making of decision.
(2) A person who files an appeal pursuant to Sub-section (1) may make such appeal by making payment of or furnishing a deposit of the duty and amount of fine and penalty chargeable pursuant to that decision or order against which such appeal is to be made, to or with the concerned Customs Office.
(3) A person who files an appeal pursuant to Sub-section (1) shall give a copy of such appeal to the concerned Customs Office no later than seven days after the filing of such appeal.
(4) In the event of not being satisfied with any decision made by the valuation review committee formed pursuant to Section 61, the Customs Officer may file an appeal to the Revenue Tribunal no later than thirty five days after the making of such decision

Chapter-13

Chapter-13

Provisions Relating to Punishment to Employees

63. Petition to be made :

(1) If one has a reasonable cause to believe that the Customs Officer or any employee of the Customs Office has done any act contrary to this Act or the Rules framed under this Act or has caused revenue loss or done any act guided by the ulterior motive to harass any importer or exporter, one may file a petition to the Director General in the case of the Customs Officer and to the Customs Officer in the case of the employee of the Customs Office.
(2) The Director General or the Customs Officer shall make an inquiry in the petition made pursuant to Sub-section (1) and give information thereof to the petitioner.
(3) If, upon the enquiry conducted pursuant to Sub-section (2), it appears that the Customs Officer or the employee of the Customs Office has done any act contrary to this Act or the Rules framed under this Act or has
caused revenue loss or done any act guided by the ulterior motive to harass any importer or exporter, the Director General shall initiate departmental action against such Customs Officer and the Customs Officer shall initiate such action against the employee of the Customs
4) In the event of not being satisfied with any decision made by the valuation review committee formed pursuant to Section 61, the Customs Officer may file an appeal to the Revenue Tribunal no later than thirty five days
after the making of such decision. Office, and if any act considered to be corruption under the prevailing laws is found committed, the matter shall be referred to the concerned authority.

64. Notice of action and limitation : No action may be instituted in relation to any act, which has been done considering that such act would be in accordance with this Act or the Rules framed under this Act, unless and until a period of two months has expired after a written notice, setting out the cause to institute the case against the Customs Officer or any employee, the name and address of the person to be plaintiff and of his or her attorney, if any, has been delivered to or sent by a registered post, to such Customs Officer or employee and a duplicate copy thereof has been submitted to the Director General.

65. Punishment to employees :

(1) Where departmental action is initiated against any civil servant who performs functions relating to customs under the prevailing Civil Service Act and Regulation and the competent authority is of the opinion that only the punishment specified in that Act and Regulation is inadequate, the competent authority specified in that Act and Regulation may also issue order for the recovery of all or any of the loss caused from the following act to any person from the property of such employee:
(a) Deliberate violation of the provisions of this Act, or
(b) Commission of any act done deliberately or with mala fide intention to cause loss and damage to the Government of Nepal, or
(c) Except for the performance in good faith of the duties of his or her office in accordance with this Act in relation to any goods, disclosure of any matters to his or her knowledge by virtue of his or her office with intention to make benefits for him or her or for any other person or to cause loss to any person or showing or supplying any matter which has been assigned to him or her and is required to be kept secret to any person.

(2) The concerned employee may file an appeal to the competent authority under the prevailing Civil Service Act and Regulation against any order issued by the competent authority under this Act; and such competent authority shall settle such appeal in accordance with that Act and Regulation.
(3) While recovering fine imposed pursuant to this Section, the competent authority may recover the same by exercising, and in accordance with, the prevailing laws on the recovery of court punishment and fine.
(4) Nothing contained in this Section shall be deemed to bar the provisions of prevailing laws under which court action can be instituted against any employee who commits offense. Provided that no action under this Section shall be taken under this Section after court action is instituted.

66. Not to be liable for any act and action done in good faith : Notwithstanding anything contained elsewhere in this Act, no customs employee shall be personally liable for any act and action done and taken in good faith in the course of discharging his or her duty.

67. Inspection:

(1) The Ministry of Finance shall, in relation to the activities carried out by the Director General, and the Department shall, in relation to the activities carried out by the Customs Officer, make inspection once a year.
(2) In carrying out inspection pursuant to Sub-section (1), the Ministry of Finance and the Department shall inspect, inter alia, whether the duty of goods exported or imported has been recovered actually, whether post clearance audit has been made pursuant to Section 34, whether or not declaration review has been made pursuant to Section 70, whether the goods required to be auctioned have been auctioned in time and whether the revenue omitted to be collected has been recovered as promptly as possible and give a report of such inspection to the Council of Ministers and the Ministry of Finance, respectively.
(3) On receipt of a report pursuant to Sub-section (2), the Council of Ministers and the Ministry of Finance shall give necessary direction to the Ministry of Finance and the Department, respectively.
(4) The Ministry of Finance shall monitor whether the direction referred to in Sub-section (3) has been observed or not, and shall also mention matters pertaining thereto in the report to be submitted to the Council of Ministers pursuant to sub- section (2)

Chapter-14

Chapter-14

Miscellaneous

68. Application for withholding goods intended to be exported or
imported in violation of intellectual property rights :

(1) If any person is going to export or import any goods in violation of intellectual property rights such as patent, design, trademark, and copy right acquired by any one pursuant to the prevailing laws, the concerned person may submit an application, accompanied by evidence, to the concerned Customs Officer for withholding such export or import.
(2) If an application is made pursuant to Sub-section (1), the concerned Customs Officer shall withhold such goods in the Customs Office and make a request to the concerned body or authority for necessary action in that respect.
(3) Such body or authority shall, upon being requested pursuant to Sub-section (2), take action in that respect and settle the matter in accordance with the prevailing laws and give information thereof to the Customs Office.
(4) If, upon taking action in accordance with the prevailing laws, the body or authority referred to in Sub-section (3), holds that such goods are liable to be forfeited, the Customs Officer shall hand over such goods to such body or authority.

69. Compensation for goods withheld in Customs Office or godown :

(1) The Customs Office or the godown shall so safely keep the goods held in the Customs Office or the godown that no loss or damage is caused to such goods.
(2) If the goods referred to in Sub-section (1) are stolen, lost or otherwise destroyed, damaged or get damaged, except for a wear and tear due to a natural calamity or accident or wear and tear likely to arise normally in the course of holding or lifting goods, the owner of such goods shall be entitled to recover, as prescribed, compensation for such goods from the Customs Office or the body operating the godown. Provided that such owner shall not be entitled to make a claim for compensation unless and until his or her title to such goods is established.

70. Power to review :

(1) The concerned Customs Officer or the employee designated by him or her may review the declaration forms of the goodscleared by the Customs Office no later than four years after the date of clearance of such goods.
(2) If, in making review pursuant to Sub-section (1), it appears that the duty recoverable has been omitted from being recovered, the duty so omitted shall be recovered from the owner of such goods as if it were a governmental due.

71. Reward to person who arrests export or import smuggling or gives clues:

(1) If any employee or person gives clues as to that any one has committed or is going to commit export or import smuggling of any goods or control such goods and hands over them to the Customs Office, reward, as prescribed, shall be provided to such employee or person if such act is proved.
(2) The concerned Customs Office shall provide the reward referred to in Sub-section (1) out of the proceeds of auction of the goods so exported or imported by way of smuggling.
(3) Notwithstanding anything contained in Sub-section (2), if the Government of Nepal makes a decision to provide such goods to any government body for use, such body shall get the value of those goods determined by the prescribed committee and, based on that value, provide the amount of reward referred to in Sub-section (1) to the concerned Customs Office, and the Customs Office shall provide that amount to the concerned person who has given clues and controlled them.
(4) The Customs Office shall keep secret the name, surname and details of any informant who gives clues about any export or import smuggling pursuant to Sub-section (1).
(5) Notwithstanding anything contained in the prevailing Nepal laws, the Customs Office shall not be compelled to provide the name, surname and details of an informant as referred to in this Act to any person or body, except when so asked by a body carrying out investigations under law in the course of such investigations or by a court, and an informant shall not be compelled to appear in any court, body or office by the reason only that the informant has provided clues.
(6) Other provisions relating to taking reports from informants and distribution of rewards shall be as prescribed.

72. Demurrage:

(1) If the owner of goods stored in a customs godown operated by the Customs Office does not get clearance and get delivery of such goods within the prescribed time limit, demurrage shall be charged as prescribed. Provided that no demurrage shall be charged in the case of those goods which could not be cleared by the Customs Officer because of confusion about the valuation, classification of goods or for other reason.
(2) Notwithstanding anything contained in Sub-section (1), if there is a reasonable ground for remitting demurrage
chargeable on any goods because of the occurrence of any special circumstance or condition, the prescribed authority may make full or partial remission, as prescribed.

73. Goods not to be lifted until payment of fine: If, in relation to any goods, a fine or excess duty is imposed or charged on the owner of such goods pursuant to this Act, such owner shall not be entitled to lift such goods from the Customs Office until that fine or excess duty is paid.

74. Payment of omitted amount or fine:

(1) If it is subsequently discovered that any duty, fine or other amount payable by any person to the Customs Office pursuant to this Act or the prevailing laws has been omitted while making valuation or classification of any goods
or because of mathematical error or otherwise, such Customs Office shall immediately recover the amount so omitted from that person.
(2) If the concerned person does not pay the amount referred to in Sub-section (1), that Office shall withhold the transactions of that person and recover that amount by auctioning, or causing to be auctioned, as prescribed, any goods whatsoever which belong to that person and are held in that Office or other Customs Offices.
(3) If the amount of duty or fine referred to in Sub-section (1) cannot be recovered even from the proceeds of auction made or caused to be made pursuant to Sub-section (2), that duty or fine or amount shall be recovered from that person as if it were a governmental due.

75. Refund of customs duty or fine:

(1) If any exporter or importer has paid the customs duty in excess of the duty which is chargeable on exportation or importation under the laws, the concerned Customs Office shall refund, as prescribed such excess customs duty to that exporter or importer.
(2) Notwithstanding anything contained in Sub-section
(1), no customs duty shall be refunded on the following condition:
(a) If no application is submitted to the concerned Customs Office to take refund of such duty within sixty days after the release of goods, or
(b) If the figure claimed for refund is less than five hundred rupees.
(3) If, in making decision on an appeal made under this Act against the duty or fine recovered by the Customs Officer, decision is made to waive all or any of the duty or fine so recovered, the Customs Officer may, notwithstanding anything contained in the prevailing laws, refund such customs duty or fine to the concerned
person only where no further appeal can be made against that order or only after the concerned court decides not to grant permission.

76. Owner of goods or agent to be responsible:

(1) If, in the opening and examination subsequently by the competent authority, within or outside the customs area, of any goods which the Customs Office has already examined under Section 28 or 29 and cleared under Section 23, the goods or units or pieces inside the luggage or packets do not correspond to the bills, invoices, other documents or details submitted by the importer, the owner of such goods or his or her agent shall be responsible therefor.
(2) A person holding any goods shall be responsible for the production of such evidence as is satisfactory to the Customs Officer that the person has imported such goods in accordance with law or has paid the duty chargeable on such goods in accordance with law.

77. Owner of goods to bear expenses: The owner of goods shall at his or her own expense do such acts as carrying the goods, taking the goods to the proper place for their opening or examination, putting the goods on and off a machine, open and set aside the goods and putting marks on the\ containers, boxes, bags, packets, sacks of or containing the goods or similar other packing materials of the goods.

78. Duplicate copies to be provided:

(1) The concerned person who wishes to obtain a duplicate copy of any certificate, bill or other document held in the Customs Office may submit an application, accompanied by the fees as prescribed.
(2) The concerned Customs Officer may inquire into the application made pursuant to Sub-section (1) and issue a duplicate copy of such bill or document.

79. Issuance of certificate of goods imported: If a person who imports goods subjected to sales tax or any other tax in a foreign country submits an application to the concerned Customs Office for a certificate thereon, the Customs Officer may issue the certificate in the form as prescribed to the applicant, by collecting the fees as prescribed from such applicant.

80. Information to be sought:

(1) Any importer may submit an application to the concerned Customs Office and seek information on the bases adopted by that Customs Office in the determination of customs value of the goods imported by the importer.
(2) If an application is submitted pursuant to Sub-section (1), that Office shall provide such information to that importer within seven days.

81. Issuance of summons and action and settlement:

(1) Notwithstanding anything contained in the prevailing laws, in issuing the initial summons in the name of the concerned person in relation to an offense under this Act, the Customs Officer or such other officer employee of the Customs Office as authorized by the Customs Officer shall issue such summons as prescribed.
(2) The summons issued pursuant to Sub-section (1) shall not be extended.
(3) The Customs Officer shall settle the case filed pursuant to this Act normally within three months.
(4) In the event of failure to settle any case within the time referred to in Sub-section (3), information thereof, setting out the reason for such failure, shall be given to the Director General.

82. Mode of issuance of notice: Except where separate provisions are made in this Act and the Rules framed under this Act, the Customs Office shall, while issuing a personal or public notice in the name of a person who has or may have concern with the activities of the Customs Office, issue a notice, as prescribed, by giving a period of
seven days.

83. Delegation of powers:

(1) The Government of Nepal may, by notification in the Nepal Gazette, delegate any or all of the powers conferred to it by this Act or the Rules framed under this Act to the Director General or any other official prescribed in that notification.
(2) The Director General may, as required, delegate some of the powers conferred to him or her by this Act to any sub- ordinate officer employee.

84. Power of Ministry of Finance to designate any official and confer powers to such official: The Ministry of Finance may confer all or any of the powers which the Customs Officer has to exercise under this Act to any official.

85. Powers of Ministry of Finance to designate any official:

(1) If a petition is filed that the Customs Officer alone or in connivance with any other employee, is going to do or is doing or has done any act contrary to this Act or the Rules framed under this Act, the Ministry of Finance may designate another Customs Officer or other official to perform activities pertaining to that function.
(2) The official designated pursuant to Sub-section (1) shall perform such activities in accordance with this Act.

86. To exercise same powers as court has: For the purposes of this Act, the Customs Officer or other employee shall have the same powers as the court of first instance has under the prevailing laws in relation to the summoning of the concerned person, taking his or her deposition, examination of evidence, requiring the submission of documents and the trial of case.

87. Duty to render assistance and help: If, in the course of exercising powers and performing duties under this Act or the Rules framed under this Act, the Customs Officer or other employee asks the police and other governmental employee for any kind of assistance or help, it shall be the duty of such police or employee to render such assistance or help.

88. Other body not to intervene: No authority or body shall, in relation to any goods remaining within the Customs Office for export or import, make any kind of intervention until such goods are cleared by that Office and removed from the customs area.

89. Power to prescribe headings or sub-headings of goods:

(1)If, in determining the customs duty, there is a doubt as to in which heading or sub-heading of the harmonized system do any goods fall, the Customs Officer shall classify such goods in the heading or sub-heading as prescribed by the Director General.
(2) If, prior to the exportation or importation of any goods, any exporter or importer submits an application to the prescribed committee also comprising an expert in the field concerned for the specification of the heading or Sub-heading of commodity classification of such goods, the committee may, also examining a sample of such goods, prescribe the heading or sub-heading of such goods.
(3) The Director General and the committee shall, in prescribing a heading or sub-heading pursuant to Sub-section (1) and sub- section (2), respectively, so prescribe based on the authentic text of the Harmonized system of the World Customs Organization. (4) For the purposes of prescribing the heading or sub-heading of any goods pursuant to Sub-sections (1) and (2), advice of the concerned expert or national or international body may be sought.
(5) The other functions and rules of procedures of the committee referred to in Sub-section (2) shall be as prescribed.

90. Power to issue order: If there arises any difficulty in the course of implementing this Act, the Ministry of Finance may, for the removal of such difficulty, publish a notice in the Nepal Gazette in a manner that such notice is not contrary to this Act.

91. Power to take action: If any person arrests any other person while bringing goods through elsewhere than the customs area by evading the customs duty and produces such other person for action under this Act, the Director General or the official deputed by him or her shall have the power to take action against such person.

92. Power to frame Rules:

(1) The Government of Nepal may frame Rules in order to implement the objectives of this Act.
(2) Without prejudice to the generality of Sub-section (1), the Government of Nepal may frame Rules of Origin in relation to goods to be exported or imported.

93. Power to make directives: The Department may, subject to this Act or the Rules framed under this Act, make directives on the procedures of valuation of goods, examination and clearance of goods and auction of goods by the Customs Office.

94. Repeal and saving:
(1) The Customs Act, 2019 (1962 A.D.) is hereby repealed.
(2) The Customs Department and Customs Offices established under
the Customs Act, 2019 (1962 A.D.) shall be deemed to have been established under this Act.
(3) All acts done and actions taken under the Customs Act, 2019 (1962 A.D.) shall be deemed to have been done and taken under this Act

Preamble

An Act made to provide for Nepal Fine Arts Academy
Preamble: Whereas, it is expedient to make legal provisions for the
establishment and operation of Nepal Fine Arts Academy in order to protect,
maintain, promote, and make overall development of Fine Arts of Nepal, a multiethnic,
multi-linguistic and multi-cultural country, and conduct, or cause to be
conducted, study and research on the discipline of fine arts and, on respecting and
honouring the intellectuals and talents in this field;
Now, therefore, be it enacted by the Legislature-Parliament.

Chapter-1 Preliminary

1. Short title and commencement: (1) This Act may be called as “Nepal Fine Arts Academy Act, 2064(2007).”
(2) This Act shall come into force immediately.
2. Definitions: Unless the subject or the context otherwise requires, in this Act:
(a) “Fine arts” means painting (Chitrakala), sculpture, folk art (Lokkala), handicraft, Silpakala, Bastukala and other creative arts.

(b) “Academy” means Nepal Fine Arts Academy established under Section 3.
(c) “Assembly” means the academic assembly as referred to in Section
(d) “Council” means the academic council as referred to in Section 11.
(e) “Chancellor” means the Chancellor of the Academy.
(f) “Vice-Chancellor” means the Vice-Chancellor of the Academy.
(g) “Secretary” means the Secretary of the Academy.
(h) “Office-bearer” means the Chancellor, Vice-chancellor, Secretary
and nominated members of the Council.
(i) “Prescribed” or “as prescribed” means prescribed or as prescribed in
the Rules framed under this Act.

Chapter-2 Establishment and Functions, Duties and Powers of the Academy

3. Establishment of the Academy:

(1) An Academy is hereby established by the name of Nepal Fine Art Academy in order to carry out activities
including the protection, preservation, promotion and overall development of Nepali fine arts.
(2) The central office of the Academy shall be situated in Kathmandu Valley, and the Academy may, as required, open its branches in various places of Nepal.

4. Academy to be autonomous body: (1) The Academy shall be an  autonomous body corporate with perpetual succession.

(2) The Academy shall have a separate seal of its own for all of its activities.
(3) The Academy may, like an individual, acquire, use, sell and dispose of, or otherwise deal with, any movable and immovable property.
(4) The Academy may, like an individual, sue by its name and be also sued by the same name.
(5) The Academy may, like an individual, make a contract and exercise and perform rights and duties under the contract.

5. Functions, duties and powers of the Academy: The functions, duties and powers of the Academy shall be as follows, in addition to the functions, duties and powers mentioned elsewhere in this Act:

(a) To formulate policies and programmes of the Academy;
(b) To collect, protect, maintain and do study and research works on fine
arts;
(c) To create and publish, or cause to be created and published, research
and innovative works on the discipline of fine arts;
(d) To make provision for the honour, respect of and prizes to native and
foreign persons who render outstanding contribution to the fine arts
discipline;
(e) To establish libraries, galleries, museums etc. relating to fine arts;
(f) To make provision of academic fellowship for study and research on
fine arts;
(g) To operate training programmes on fine arts;
(h) To do study and research on, protect and maintain, fine arts that
reflect identity of various castes, tribes and communities of Nepal;

(i) To introduce Nepali fine arts to the world and vice versa;
(j) To encourage relevant organizations and persons to develop and
expand fine arts;
(k) To hold, or cause to be held, national and international symposia,
workshops, conferences, exhibitions, festivals and competitions on
fine arts;
(l) To establish and expand relations with organizations related with the
field of fine arts and exchange mutual cooperation with such
organizations;
(m) To boost up, develop and expand folk pro-people (Lokpaccchiya)
arts;
(n) To perform, or cause to be performed such other functions as may be
required for the accomplishment of the objectives of this Act.

Chapter-3 Organization of the Academy

6. Organization of the Academy: The organization of the Academy shall
be as follows, and their collective form shall be the structure of the
Academy:
(a) Assembly,
(b) Council, and
(c) Service Commission.

7. Assembly:

(1) There shall be an Academic Assembly as the supreme body
of the Academy.
(2) The composition of the Assembly shall be as follows: (a) Chancellor -Chairperson
(b) Vice-Chancellor -Vice-chairperson
(c) Secretary, Ministry of Culture,
Tourism and Civil Aviation -Member
(d) Twenty Four persons nominated by the Prime Minister from amongst the outstanding persons related with the field of fine arts, having regard to inclusiveness and also in such a manner as to have appropriate representation of women, as well -Member
(e) Secretary -Member secretary
(3) The tenure of office of the nominated members as referred to in Sub-section (2) shall be Four years.
(4) If the office of a nominated member of the Assembly falls vacant for any reason, another person shall be nominated for the remainder of term
of office from the same discipline or sector as such a member was
nominated.
(5) The facilities of the members of the Assembly shall be as
prescribed.

8. Recommendation committee:

(1) There shall be a recommendation
committee as follows for making recommendation of names to the Prime
Minister for appointment of office-bearers and nomination of members to
be nominated in the Assembly:

(a) Minister for Culture, Tourism and Civil
Aviation -Chairperson
(b) Two persons designated by the Prime
Minister from amounts persons who are
renowned in the field of fine arts -Member

(2) In recommending names for nomination of members of the
Assembly, the committee as referred to in Sub-section (1) shall recommend
names from amongst the persons who have done teaching and research in
the field of fine arts or who are renowned in that discipline, in such a
manner as to have representation from all disciplines and fields of fine arts
and as to include all castes/tribes, genders and languages and dialects.
(3) In recommending names for appointment of office-bearers, the
committee as referred to in Sub-section (1) shall recommend from amongst
the nominated members of the Assembly.
(4) The procedures to be followed by the committee as referred to in
Sub-section (1) in making recommendation shall be as determined by the
committee itself.

9. Functions, duties and powers of the Assembly: The functions, duties
and powers of the Assembly shall be as follows:
(a) To fix policies of the Academy;
(b) To approve annual plans and programmes of the Academy;
(c) To pass annual budget of the Academy;
(d) To endorse fellowship, honour and prizes,
(e) To give necessary direction and guidance to the Council;
(f) To monitor and evaluate the activities of the Council;(g) To approve the Rules of the Academy;
(h) To perform such other acts as prescribed.

10. Meeting of the Assembly: (1) The Assembly shall hold its meeting at
least Twice a year.
(2) The meeting of the Assembly shall be held at such a date, time
and venue as specified by the chairperson of the Assembly.
(3) The member secretary of the Assembly shall give a notice,
accompanied by the agenda to be discussed at the meeting, to every
member in advance of at least Fifteen days of the holding of the meeting of
the Assembly.
(4) The presence of more than Fifty percent of the total number of
the then members of the Assembly shall be deemed to constitute a quorum
for a meeting of the Assembly.

(5) The meeting of the Assembly shall be presided over by the
chairperson of the Assembly, and by the vice-chairperson, in the absence of
the chairperson.
(6) A majority opinion shall prevail at the meeting of the Assembly;
and in the event of a tie, the person presiding over the meeting shall
exercise the casting vote.
(7) The decisions of the Assembly shall be authenticated by the
member secretary of the Assembly.
(8) The Assembly may invite honourary academician and life-long
members of the Academy to take part as an observer in the meeting of the
Assembly.
(9) Other procedures relating to the meeting of the Assembly shall
be as determined by the Assembly itself.

11. Council:

(1) There shall be an Academic Council to act as an executive
body of the Academy.
(2) The composition of the Council shall be as follows:
(a) Chancellor -Chairperson
(b) Vice-Chancellor -Vice-chairperson
(c) Six persons nominated by the Prime
Minister from amongst the nominated
members of the Assembly, consisting
of at least Two women, and in such a
manner as to have representation from
various castes, tribes, languages and
dialects, as far as possible -Member
(d) Secretary -Member secretary
(3) If the office of a member as referred to in Clause (c) of Subsection
(2) falls vacant for any reason, another person shall be nominated
for the remainder of term of office from the same discipline or sector as
such a member was nominated.

12. Functions, duties and powers of the Council: The functions, duties
and powers of the Council shall be as follows:
(a) To implement the decisions made by the Assembly;
(b) To abide by directions given by the Assembly;
(c) To submit the audit report to the Assembly;

(d) To discuss, and amend as required, annual programmes, budget,
progress reports and other reports submitted by the Secretary and
submit the same to the Assembly for endorsement;
(e) To manage, operate, protect and look after, or cause to be managed,
operated, protected and looked after, the movable and immovable
properties of the Academy;
(f) To manage and operate the fund of the Academy;
(g) To receive financial and other assistance received for the Academy;
(h) To submit a proposal of fellowship, honour and prizes to the
Assembly for approval,
(i) To form, as required, any committee, sub-committee or task force in
relation to the activities of the Council and specify the functions,
duties and powers of such committee, sub-committee or task force,
(j) To perform such other functions as prescribed.

13. Meeting of the Council: (1) The Council shall hold its meeting at least
once in every Two months.

(2) The meeting of the Council shall be held at such a date, time and
venue as specified by the chairperson of the Council.
(3) The member secretary shall give a notice, accompanied by the
agenda to be discussed at the meeting, to every member in advance of at
least Twenty Four hours of the holding of the meeting of the Council.
(4) The presence of more than Fifty percent of the total number of
the then members of the Council shall be deemed to constitute a quorum for
a meeting of the Council.

(5) The meeting of the Council shall be presided over by the
chairperson of the Council, and by the vice-chairperson, in the absence of
the chairperson.
(6) A majority opinion shall prevail at the meeting of the Council;
and in the event of a tie, the person presiding over the meeting shall
exercise the casting vote.
(7) The decisions of the Council shall be authenticated by the
member secretary of the Council.
(8) Other procedures relating to the meeting of the Council shall be
as determined by the Council itself.

Chapter-4 Chief Patron, Patron, office-bearers and employees of the Academy

14. Chief Patron: The Prime Minister shall be the Chief Patron of the
Academy.

15. Patron: The Minister for Culture, Tourism and Civil Aviation shall be the
Patron of the Academy.

16. Chancellor: (1) There shall be one Chancellor in the Academy.
(2) The Chancellor shall be the chief office-bearer of the Academy.

17. Functions, duties and powers of the Chancellor: The functions,
duties and powers of the Chancellor shall be as follows, in addition to the
functions, duties and powers mentioned elsewhere in this Act:
(a) To implement, or cause to be implemented, directions given by the
Assembly and decisions made by the Council;

(b) To cause annual programmes, budget, progress reports and other
reports of the Academy to be prepared;
(c) To exercise general control over the acts, actions and personnel
administration of the Academy;
(d) To make contracts on behalf of the Academy, by obtaining approval
of the Council;
(e) To make necessary contact with native and foreign organizations on
matters related with the functions of the Academy;
(f) To perform such other functions as prescribed.
18. Vice-chancellor: There shall be one Vice-chancellor in the Academy.

19. Functions, duties and powers of the Vice-chancellor: The functions,
duties and powers of the Vice-chancellor shall be as follows:
(a) To assist the Chancellor in implementing, or causing to be
implemented, directions given by the Assembly and decisions made
by the Council;
(b) To perform all such functions in the absence of the Chancellor as
required to be performed by the Chancellor;
(c) To perform other functions at the direction of the Chancellor.

20. Secretary: (1) There shall be one Secretary in the Academy.
(2) The functions, duties and powers of the Secretary shall be as
prescribed.

21. Provisions relating to office-bearers: (1) The Prime Minister shall,
subject to this Act, appoint the office-bearers.
(2) The term of office of the office-bearer shall be Four years.

(3) The office-bearers shall serve in the Academy on the whole-time
basis.
(4) The remuneration, conditions of service and facilities of the
office-bearers shall be as prescribed.

22. Circumstance where office becomes vacant: The office of an officebearer
and Assembly member shall be deemed to be vacant in any of the
following circumstances:
(a) If his or her term of office expires;
(b) If he or she resigns;
(c) If he or she is of unsound mind;
(d) If he or she is convicted by a court of a criminal offence involving
moral turpitude;
(e) If he or she is removed from office pursuant to Section 23; or
(f) If he or she dies.

23. Power to remove from office: (1) If at least One Fourth of the currently
existing members of the Assembly make an application in writing to the
prime Minister that any office-bearer or Assembly member has failed to
perform the duties of his or her office in consonance with the objectives of
this Act or to perform conduct corresponding to his or her office or to
perform his or her duties honestly, the Prime Minister shall form an inquiry
committee from amongst the members of the Assembly.

(2) The inquiry committee as referred to in Sub-section (1) shall
make inquiries into the matter and submit its report to the Prime Minister,
and the Prime Minister shall arrange to lay such a report before the
Assembly for discussions.

(3) If, on holding discussions on the report submitted pursuant to
Sub-section (2), a majority of the members of the Assembly decide to the
effect that the office-bearer or member of the Assembly has failed to
perform the duties of his or her office in consonance with the objectives of
this Act or to perform conduct corresponding to his or her office or to
perform his or her duties honestly, the Prime Minister shall remove such
office-bearer or member of the Assembly from his or her office.

(4) Prior to removing the office-bearer or member of the Assembly
pursuant to Sub-section (3), the office-bearer or member shall be given an
opportunity to defend himself or herself.

24. Employees: (1) The Academy shall have a required number of employees.
(2) The provisions relating to the appointment, remuneration,
facilities and terms and conditions of service of the employees as referred
to in Sub-section (1) shall be as prescribed.

25. Service Commission: (1) There shall be an Academy Service
Commission, as follows, to make recommendation for the permanent
appointment and promotion of the employees of the Academy.

(a) A Member of the Public Service
Commission designated by that
Commission -Chairperson
(b) One member of the Assembly designated by
the Assembly -Member
(c) Secretary -Member
secretary

(2) The other functions, duties and powers of the Service
Commission shall be as prescribed.
(3) The procedures relating to the meetings of the Service
Commission shall be as determined by the Service Commission itself.
(4) The chairperson and members of the Service Commission shall
be entitled to such meeting allowance as prescribed for taking part in the
meetings of the Service Commission.