Cost Audit Rules-Amended

MCA vide notification dated 31st December 2014 has made amendment in the Companies (cost records and audit) Rules, 2014 through Companies (Cost Records and Audit) Amendment Rules, 2014. The details of amendment is reproduced as below:-

1. In rule 2 

After clause (a) the following clause shall be inserted:-
(aa) Central Excise Tariff Act Heading means the heading as referred in the Additional Notes in the First schedule of the central Excise Tariff Act, 1985 [5 of 1986]

2. Rule 3 shall be substituted by the following rule:- 

Position under existing rule 3:
The existing rule 3 provides for applicability of the requirement of maintaining the cost records on the following class of companies:

• Companies engaged in production of prescribed goods under strategic sector
• Prescribed classes of company regulated by sectoral regulator or a ministry or department of central government
• Companies operating in areas involving public interest
• Company including foreign company (other than liaison offices) engaged in the production, import, supply or trading of prescribed category of medical devices.

For each of the aforesaid classes of companies, a separate limits were prescribed for the compliance of the rule

Rule 3 after amendment:
“3. Application of Cost Record - For the purposes of sub-section (I) of section 148 of the Act. the class of companies, including foreign companies defined in clause (42) of section 2 of the Act, engaged in the production of the goods or providing services, specified in the fable below, having an overall turnover from all its products and services of rupees thirty five crore or more during the immediately preceding financial year, shall include cost records for such products or services in their books of account, namely:-
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MCA has notified the much awaited amendments to Cost Rules.

Cost Records applicable if turnover exceeds Rs.35 cr. Cost Audit applicability if turnover exceeds Rs.50 Cr (Regulated Industry), Rs.100 Cr. (Others). Refer Detailed Notification at: http://www.mca.gov.in/ Ministry/pdf/Amendment_Rules_ 01012014.pdf