MCA clarification : General Circulars exempting certain activities are also applicable in respect of industry specific Cost Accounting Records Rules

F. No. 52/13/CAB-2011

Government of India

Ministry of Corporate Affairs

Cost Audit Branch

B-1 Wing,2^nd Floor

                                                                                               Paryavaran   Bhavan,                                                                                           

CGO Complex

New Delhi -110003
Dated the 4^th June, 2012

 

 

To,

The President

Institute of Cost Accountants of India,

12, Sudder Street,

Kolkata -700016

 

Subject: Cost Accounting Records and Audit General Clarifications

Sir,

Ministry of Corporate Affairs has so for issued following circulars in connection with                              the cost accounting records cost audit appointment of cost auditors etc:

1. General Circular No. 15/2011 dated 11^th  April ,2011
2. Master Circular No ,2/2011 Dated 11^th  November ,2011
3. General Circular No. 67/2011 dated 30^th November ,2011
4. General Circular No.68/2011 dated 30^th November ,2011
5. General Circular No. 8/2012 dated 10^th 2012
6. General Circular No .11/2012 dated 25^th May. 2012

It Is hereby clarified that these circulars (including the present circular ) are applicable in respect of all the accounting records rules notified in 2011 and the  Industry specific cost audit orders issued so far, to the extent these are relevant and applicable

2.  Ministry of corporate Affairs vide no .52/26/CAB-2010 dated 2nd May 2011 had directed that every company to witch any of the following rules apply and wherein the aggregate value of net worth as on the last date of the immediately preceding financial year exceeds five crore of rupees or wherein the  Aggregate value of the turnover made by the company from sale or supply of all products or activities during the immediately  preceding financial year exceeds Twenty crore of rupees, or wherein the company `s equity or debt securities are listed or are in the process of listing on any stock  exchange ,whether in India or outside India shall get its  Cost accounting records in respect of each of its financial year  commencing on or after the 1^st day of April ,2011, audited by a cost auditor  who shall be either a cost accountant or a firm of Cost and works accountants act ,1959 (23 of 1959)

(a)  Cost Accounting Records (Bulk Drugs) Rules, 1974

(b)  Cost Accounting Records (Formulations) Rules, 1988

(c) Cost Accounting Records (Fertilizers) Rules, 1993

(d) Cost Accounting Records (Sugar) Rules, 1997

(e) Cost Accounting Records (Industrial alcohol) Rules, 1997

(f) Cost Accounting Records (Electricity Industry) Rules, 2001

(g) Cost Accounting Records (Petroleum Industry) Rules, 2002

(h) Cost Accounting Records (Telecommunications) Rules, 2002

 

3. In supersession of the aforesaid Rules, following industry specific Cost Accounting Records Rules were notified:

 

1. Cost Accounting Records (Telecommunication Industry) Rules 2011 notified vide GSR 869(E) dated December 7, 2011.
2.  Cost Accounting Records (Petroleum Industry) Rules 2011 notified vide GSR 870(E) dated December 7, 2011.
3. Cost Accounting Records (Electricity Industry) Rules 2011 notified vide GSR 870(E) dated December 7, 2011.
4. Cost Accounting Records (Sugar Industry) Rules 2011 notified vide GSR 870(E) dated December 7, 2011.
5. Cost Accounting Records (Fertilizer Industry) Rules 2011 notified vide GSR 870(E) dated December 7, 2011.
6. Cost Accounting Records (Pharmaceutical Industry) Rules 2011 notified vide GSR 870(E) dated December 7, 2011.

 

4.    In view of above, it is hereby clarified that the Cost Audit Order No. 52/26/CAB-2010 dated 2^nd May, 2011 shall be applicable as under:

 

a)      For all Companies wherein their products/ activities are already covered under any of the erstwhile industry specific Cost Accounting Records Rules, as mentioned in Para 2 above [before their supersession] and meeting with the threshold limits mentioned in the said Cost Audit Orders in respect of each financial year commencing on or after the 1^st day of April, 2011 i.e. from the financial year 2011-12 onwards.

b)      For all companies wherein their products/ activities are for the first time covered under any of the revised industry specific Cost Accounting Records Rules, as mentioned in Para 3 above and meeting with the threshold limits mentioned in the said Cost Audit Orders in respect of each financial year commencing on or after the 7^th December, 2011, i.e. from the financial year 2012-13 [incl. Calendar year 2012] onwards.

 

5.   It is further clarified that in case of companies engaged in production, processing, manufacturing or mining of multiple products/ activities, if any of their products/ activities are not covered under the industry specific cost accounting records rules ,but are covered under the companies (Cost accounting records )rules 2011 notified  vide GSR 429(E) dated June 3, 2011 and wherein such products/ activities are not covered under cost audit vide cost audit orders dated  June 30, 2011 and January 24,2012: such company shall be required to file compliance report with the central government in accordance with the clarifications given vide Para (a) of the MCA`s General Circular No, 68/2011 dated 30^th November 2011

6.  The Institute is requested to circulate this general for the information of all concerned

Copy to :

1. E-Governance Cell, Ministry of  Corporate Affairs, Shastri  Bhavan New Delhi with a request to upload this circular on the MCA`s website
2. All Regional Directors /Registrars of Companies
3. PS to CAM /PS to MOS
4. PS to Secretary/ Special Secretary
5. PS to Joint Secretary (A) /Joint Secretary (R)/ Joint Secretary (M)
6. PS to DII (RC) /DII(UCN)
7. PS to Economic Adviser