This document provides an overview of the assessment process under the Maharashtra Value Added Tax (MVAT) Act. Some key points:
1) Assessment can be done through self-assessment if returns are filed on time, or the tax authority can issue notices for assessment. Notices can be issued within 2-5 years depending on return filing status.
2) The tax authority has significant powers for assessment including passing ex-parte orders without notice or hearing in some cases of late filing.
3) Single or multiple assessing authorities can assess the same dealer for the same period through regular or transaction-based assessments.
4) Re-assessments for escaped turnover can be done within 5-6 years
Dokumen tersebut memberikan informasi mengenai:
1. Apa itu SPT Tahunan dan kewajiban Wajib Pajak untuk menyampaikan SPT Tahunan
2. Jenis-jenis penghasilan yang harus dilaporkan dalam SPT Tahunan
3. Cara pengisian dan penyampaian SPT Tahunan
This document provides an overview of taxes, specifically income tax. It discusses direct and indirect taxes, how income tax is collected internationally, and key concepts in double taxation treaties. Direct taxes are paid by the party bearing the cost, while indirect taxes are collected from one party but paid by another. Income tax can be collected at the source of income or in the country of residence through tax credits. Double taxation treaties determine which country has the right to tax different types of income like business profits, royalties, and fees to avoid double taxation between countries.
07. payment of tax before assessment ICAB, KL, Study Manual
07. payment of tax before assessment ICAB, KL, Study Manual
07. payment of tax before assessment ICAB, KL, Study Manual
07. payment of tax before assessment ICAB, KL, Study Manual
07. payment of tax before assessment ICAB, KL, Study Manual
This document is a student project submitted by Ms. Jeenal N. Rathod on Maharashtra Value Added Tax (MVAT). It provides an introduction and overview of MVAT, including its implementation in Maharashtra on April 1, 2005. It discusses the experience of implementing VAT previously in Maharashtra from 1995 to 1999. It also examines various aspects of assessment under the MVAT Act, including self-assessment, assessment of dealers, assessment of transactions, and re-assessment procedures.
Este documento describe los conceptos y procesos de exportación definitiva, drawback y devolución del saldo a favor del IGV para exportadores. La exportación definitiva es el régimen aduanero aplicable a mercaderías que salen del territorio aduanero para su uso definitivo en el exterior, sin tributo. El drawback permite la devolución de hasta el 5% del valor FOB de bienes exportados o el 50% de su costo de producción. La devolución del saldo a favor del IGV permite a los exportadores recuperar el IGV pagado en in
The document summarizes the key provisions around e-way bills under the GST law. It discusses the 5 rules dealing with e-way bills - information to be provided prior to movement of goods, documents/devices to be carried during transit, verification of documents/conveyances during transit, inspection of goods, and facility for uploading detention details. It provides details on when an e-way bill is required, its validity period, documents to be carried, and consequences of acceptance/rejection of details by the recipient. RFID is required to be mapped to the e-way bill number for certain class of transporters.
Dokumen tersebut memberikan informasi mengenai:
1. Apa itu SPT Tahunan dan kewajiban Wajib Pajak untuk menyampaikan SPT Tahunan
2. Jenis-jenis penghasilan yang harus dilaporkan dalam SPT Tahunan
3. Cara pengisian dan penyampaian SPT Tahunan
This document provides an overview of taxes, specifically income tax. It discusses direct and indirect taxes, how income tax is collected internationally, and key concepts in double taxation treaties. Direct taxes are paid by the party bearing the cost, while indirect taxes are collected from one party but paid by another. Income tax can be collected at the source of income or in the country of residence through tax credits. Double taxation treaties determine which country has the right to tax different types of income like business profits, royalties, and fees to avoid double taxation between countries.
07. payment of tax before assessment ICAB, KL, Study Manual
07. payment of tax before assessment ICAB, KL, Study Manual
07. payment of tax before assessment ICAB, KL, Study Manual
07. payment of tax before assessment ICAB, KL, Study Manual
07. payment of tax before assessment ICAB, KL, Study Manual
This document is a student project submitted by Ms. Jeenal N. Rathod on Maharashtra Value Added Tax (MVAT). It provides an introduction and overview of MVAT, including its implementation in Maharashtra on April 1, 2005. It discusses the experience of implementing VAT previously in Maharashtra from 1995 to 1999. It also examines various aspects of assessment under the MVAT Act, including self-assessment, assessment of dealers, assessment of transactions, and re-assessment procedures.
Este documento describe los conceptos y procesos de exportación definitiva, drawback y devolución del saldo a favor del IGV para exportadores. La exportación definitiva es el régimen aduanero aplicable a mercaderías que salen del territorio aduanero para su uso definitivo en el exterior, sin tributo. El drawback permite la devolución de hasta el 5% del valor FOB de bienes exportados o el 50% de su costo de producción. La devolución del saldo a favor del IGV permite a los exportadores recuperar el IGV pagado en in
The document summarizes the key provisions around e-way bills under the GST law. It discusses the 5 rules dealing with e-way bills - information to be provided prior to movement of goods, documents/devices to be carried during transit, verification of documents/conveyances during transit, inspection of goods, and facility for uploading detention details. It provides details on when an e-way bill is required, its validity period, documents to be carried, and consequences of acceptance/rejection of details by the recipient. RFID is required to be mapped to the e-way bill number for certain class of transporters.
Composition Scheme in Revised GST Model Law
Eligibility & Conditions for Composition Scheme in GST Law
Rate of Tax in Composition Scheme
Restrictions to opt Composition Scheme
Return Form & Due dates in Composition Scheme
Late fees
TDS Rate for F.Y. 19-20 comparative with F.Y. 18-19 and other regular require...Masum Gazi
TDS Rate for F.Y. 19-20 comparative with F.Y. 18-19 and other regular requirements of Income Tax required to be complied by a company/Branch office/Liaison office/Bank/Non-Banking Financial Institutions/Insurance companies/NGOs etc. (where applicable)
E Way Bill Law and Procedure. Movement of Goods under GST shall be governed by E Way Bill System. This system is becoming mandatory from 1 Feb 2018 for Interstate movement while for intrastate movement will become mandatory from 1 Jun 2018 or earlier (subject to state notification)
Transportes Bello es una empresa chilena de transporte terrestre fundada en 1960 que se ha diferenciado por sus inversiones tecnológicas. Opera en Chile y Sudamérica con 800 vehículos y 6 sucursales en Chile. Su visión es ser la empresa líder en el sur de América y mantiene certificaciones ISO en gestión, seguridad y medio ambiente.
OBJECTIVE
Goods and Services Tax (GST) is an Indirect Tax levied in India introduced in July, 2017 which was one of the most important reforms in the Indian Economy. Timely refund mechanism is essential in tax administration, as it facilitates trade through the release of blocked funds for working capital, expansion and modernisation of existing business. In this webinar, we shall be learning the procedural aspects of refund under GST law.
Common Security Guard/Police call signsKevin Oulette
This document lists the phonetic alphabet used in radio communications to clearly spell out letters. It provides the standard radio alphabet equivalents for each letter of the English alphabet from A to Z, such as Alpha for A, Bravo for B, Charlie for C, and so on through the alphabet ending with Zulu for Z.
MENSAJERIA Y TRANSPORTE DE CARGA TERRESTRE LorenaSierra06
El documento describe los servicios de mensajería y transporte de carga terrestre. Explica que estos servicios consisten en el transporte y entrega de documentos y otros bienes, y están exentos del IVA según la ley tributaria. También detalla los procedimientos para realizar envíos de carga terrestre, como contactar a una oficina de mensajería, embalaje, seguros, y empresas que ofrecen estos servicios.
Goods transport agencies providing transportation of goods by road are required to register under GST if their annual turnover exceeds 20 lakh rupees. They must generate an e-way bill for movement of goods valued over 50,000 rupees and maintain records like consignment notes as proof of transport. Transportation charges attract a 5% GST rate without input tax credit or 18% with full input tax credit. Registered transporters must file regular returns detailing supplies and pay tax amounts by specified due dates.
Foreign service go(p) no 45 2013-fin dated 22-01-2013Pradeep Kumar
This document summarizes new rules regarding the maximum period of deputation to foreign service for government officers in Kerala, India. Key points:
- The period of deputation can initially be up to one year and extended annually up to a maximum continuous period of 5 years.
- Officers must be relieved on the expiry date unless the period is extended in writing in advance. Overstaying will result in disciplinary action.
- Overstay periods will not count for pension purposes and increments will be deferred until the officer rejoins their parent cadre. No ex post facto approval will be given.
- The rules also apply to deputations between departments or services within the state government.
TDS rate in Bangladesh for the FY 20-21 in comparison with FY 19-20 and regul...Masum Gazi
Tax Deducted at Source (TDS)/Collected at Source (TCS) in Bangladesh for the FY 2020-21 in comparison with the FY 2019-20 and regular requirements/compliance under Income Tax Ordinance and Rules 1984 in Bangladesh.
This document discusses the different types of assessments under the Goods and Services Tax (GST) in India. It defines assessment and describes the key types as self-assessment, provisional assessment, re-assessment, best judgment assessment, and summary assessment. For each type, it provides details on the procedures involved, including applicable forms, timelines for orders, and treatment of interest in case of underpayment or overpayment of taxes. The document summarizes the different assessment scenarios and procedures to help taxpayers and officers understand their obligations and processes under GST.
The document discusses the reverse charge mechanism under GST. It provides an introduction to reverse charge and explains that in some cases, the liability to pay tax shifts from the supplier to the recipient of goods or services. It lists various goods and services that are subject to reverse charge as specified by the government. It also discusses key aspects of reverse charge like applicable recipients and suppliers, time of supply, and implications for composition scheme registrants.
The chapter consists of Tax Deducted at Source and Collection of Tax at source.
Tax Deducted at Source (TDS) is one of the ways to collect tax based on certain percentages on the amount payable by the receiver on goods/services. The collected tax is a revenue for the government.
Who is liable to deduct TDS under GST law?
A. A department or an establishment of the Central Government or State Government; or
B. Local authority; or
C. Governmental agencies; or
D. Such persons or category of persons as may be notified by the Government.
As per the latest Notification dated 13th September 2018, the following entities also need to deduct TDS-
An authority or a board or any other body which has been set up by Parliament or a State Legislature or by a government, with 51% equity ( control) owned by the government.
A society established by the Central or any State Government or a Local Authority and the society is registered under the Societies Registration Act, 1860.
Public sector undertakings.
What is TCS under GST
Tax Collected at Source (TCS) under GST means the tax collected by an e-commerce operator from the consideration received by it on behalf of the supplier of goods, or services who makes supplies through the operator’s online platform. TCS will be charged as a percentage on the net taxable supplies. The provision of TCS under GST is dealt under Section 52 of the CGST Act.
Who is liable to collect TCS under GST
Certain operators who own, operate and manage e-commerce platforms are liable to collect TCS. TCS applies only if the operators collect the consideration from the customers on behalf of vendors or suppliers. In other words, when the e-commerce operators pay the consideration collected to the vendors they have to deduct an amount as TCS and pay the net amount.
Here are few exceptions to the TCS provisions for the services provided by an e-commerce platform:
Hotel accommodation/clubs (unregistered suppliers)
Transportation of passengers – radio taxi, motor cab or motorcycle
Housekeeping services like plumbing, carpentry etc. (unregistered suppliers)
For example – M/s.XYZ stores (a proprietorship) is selling garments through Flipkart. Flipkart, being an e-commerce operator, before it makes the payment of consideration collected on behalf of XYZ, will be liable to deduct TCS.
What is the rate applicable under TCS
The dealers or traders supplying goods and/or services through e-commerce operators will receive payment after deduction of TCS @ 1%. The rate is notified by the CBIC in Notification no. 52/2018 under CGST Act and 02/2018 under IGST Act.
This means for an intra-state supply TCS at 1% will be collected, i.e 0.5 % under CGST and 0.5% under SGST. Similarly, for a transaction between the states, the TCS rate will be 1%, i.e under the IGST Act.
This document provides notes for the March 2022 attempt of the CAF-02 Tax Practices exam. It includes the syllabus breakdown and weightages, an overview of Pakistan's revenue collection system, a table of contents for the study material, and summaries of key concepts related to the income tax system in Pakistan. Some of the key points covered include the history of Pakistan's tax laws, objectives and tools of taxation, principles of tax levy, characteristics of tax laws, definitions of important tax-related terms, rules around tax year and residential status, geographical sources of income, and the basics of taxing employment income from salary.
OBJECTIVE
Goods and Services Tax (GST) is an Indirect Tax levied in India introduced in July, 2017 which was one of the most important reforms in the Indian Economy. Timely refund mechanism is essential in tax administration, as it facilitates trade through the release of blocked funds for working capital, expansion and modernisation of existing business. In this webinar, we shall understand and analyse the provisions related to Refund under the GST law.
1. The document discusses the Kerala Land Conservancy Act and the roles and responsibilities of revenue officers in protecting public property and preventing encroachment.
2. It outlines the procedures for reporting and evicting encroachments, including the required forms and steps to take possession of encroached land.
3. The punishments for offenses like encroachment, transferring public land through forged documents, abetment, and laxity by officials are described, with fines ranging from Rs. 10,000 to Rs. 2,00,000 and imprisonment from 1 to 7 years.
Self-assessment, provisional assessment, scrutiny of returns, assessment of non-filers and unregistered persons, and summary assessment are the main types of assessments under the Act. The proper officer may conduct audit of registered persons to verify correctness of returns filed. Special audit can also be ordered if the officer feels value or credit availed requires further verification. Audit report findings can initiate proceedings for recovery of short paid tax or erroneously claimed credits.
The document provides information about e-way bills in India. It discusses the objective and need for e-way bills, provisions under law, the e-way bill generation process which involves filling Part A and Part B, validity periods, extensions, cancellations, exceptions and verification process. E-way bills are required for inter-state movement of goods of over Rs. 50,000 in value and aim to facilitate seamless movement of goods and prevent tax evasion. Registered persons need to generate e-way bills on the common portal prior to movement of goods, listing key details of the consignment, supplier and recipient.
This document provides an introduction and overview of the Maharashtra Value Added Tax Act of 2002. It discusses key aspects of VAT including:
- VAT is a multi-stage tax system that taxes value added at each stage of production and distribution, allowing tax credits for taxes previously paid.
- The Act replaced the earlier Bombay Sales Tax Act and came into effect on April 1, 2005, establishing the VAT system in Maharashtra.
- Registration is required if annual turnover exceeds Rs. 1 lakh for traders or Rs. 5 lakhs for manufacturers. Importers must register regardless of turnover.
- Goods are classified into Schedules A-E and taxed at rates from 0-20% depending
Composition Scheme in Revised GST Model Law
Eligibility & Conditions for Composition Scheme in GST Law
Rate of Tax in Composition Scheme
Restrictions to opt Composition Scheme
Return Form & Due dates in Composition Scheme
Late fees
TDS Rate for F.Y. 19-20 comparative with F.Y. 18-19 and other regular require...Masum Gazi
TDS Rate for F.Y. 19-20 comparative with F.Y. 18-19 and other regular requirements of Income Tax required to be complied by a company/Branch office/Liaison office/Bank/Non-Banking Financial Institutions/Insurance companies/NGOs etc. (where applicable)
E Way Bill Law and Procedure. Movement of Goods under GST shall be governed by E Way Bill System. This system is becoming mandatory from 1 Feb 2018 for Interstate movement while for intrastate movement will become mandatory from 1 Jun 2018 or earlier (subject to state notification)
Transportes Bello es una empresa chilena de transporte terrestre fundada en 1960 que se ha diferenciado por sus inversiones tecnológicas. Opera en Chile y Sudamérica con 800 vehículos y 6 sucursales en Chile. Su visión es ser la empresa líder en el sur de América y mantiene certificaciones ISO en gestión, seguridad y medio ambiente.
OBJECTIVE
Goods and Services Tax (GST) is an Indirect Tax levied in India introduced in July, 2017 which was one of the most important reforms in the Indian Economy. Timely refund mechanism is essential in tax administration, as it facilitates trade through the release of blocked funds for working capital, expansion and modernisation of existing business. In this webinar, we shall be learning the procedural aspects of refund under GST law.
Common Security Guard/Police call signsKevin Oulette
This document lists the phonetic alphabet used in radio communications to clearly spell out letters. It provides the standard radio alphabet equivalents for each letter of the English alphabet from A to Z, such as Alpha for A, Bravo for B, Charlie for C, and so on through the alphabet ending with Zulu for Z.
MENSAJERIA Y TRANSPORTE DE CARGA TERRESTRE LorenaSierra06
El documento describe los servicios de mensajería y transporte de carga terrestre. Explica que estos servicios consisten en el transporte y entrega de documentos y otros bienes, y están exentos del IVA según la ley tributaria. También detalla los procedimientos para realizar envíos de carga terrestre, como contactar a una oficina de mensajería, embalaje, seguros, y empresas que ofrecen estos servicios.
Goods transport agencies providing transportation of goods by road are required to register under GST if their annual turnover exceeds 20 lakh rupees. They must generate an e-way bill for movement of goods valued over 50,000 rupees and maintain records like consignment notes as proof of transport. Transportation charges attract a 5% GST rate without input tax credit or 18% with full input tax credit. Registered transporters must file regular returns detailing supplies and pay tax amounts by specified due dates.
Foreign service go(p) no 45 2013-fin dated 22-01-2013Pradeep Kumar
This document summarizes new rules regarding the maximum period of deputation to foreign service for government officers in Kerala, India. Key points:
- The period of deputation can initially be up to one year and extended annually up to a maximum continuous period of 5 years.
- Officers must be relieved on the expiry date unless the period is extended in writing in advance. Overstaying will result in disciplinary action.
- Overstay periods will not count for pension purposes and increments will be deferred until the officer rejoins their parent cadre. No ex post facto approval will be given.
- The rules also apply to deputations between departments or services within the state government.
TDS rate in Bangladesh for the FY 20-21 in comparison with FY 19-20 and regul...Masum Gazi
Tax Deducted at Source (TDS)/Collected at Source (TCS) in Bangladesh for the FY 2020-21 in comparison with the FY 2019-20 and regular requirements/compliance under Income Tax Ordinance and Rules 1984 in Bangladesh.
This document discusses the different types of assessments under the Goods and Services Tax (GST) in India. It defines assessment and describes the key types as self-assessment, provisional assessment, re-assessment, best judgment assessment, and summary assessment. For each type, it provides details on the procedures involved, including applicable forms, timelines for orders, and treatment of interest in case of underpayment or overpayment of taxes. The document summarizes the different assessment scenarios and procedures to help taxpayers and officers understand their obligations and processes under GST.
The document discusses the reverse charge mechanism under GST. It provides an introduction to reverse charge and explains that in some cases, the liability to pay tax shifts from the supplier to the recipient of goods or services. It lists various goods and services that are subject to reverse charge as specified by the government. It also discusses key aspects of reverse charge like applicable recipients and suppliers, time of supply, and implications for composition scheme registrants.
The chapter consists of Tax Deducted at Source and Collection of Tax at source.
Tax Deducted at Source (TDS) is one of the ways to collect tax based on certain percentages on the amount payable by the receiver on goods/services. The collected tax is a revenue for the government.
Who is liable to deduct TDS under GST law?
A. A department or an establishment of the Central Government or State Government; or
B. Local authority; or
C. Governmental agencies; or
D. Such persons or category of persons as may be notified by the Government.
As per the latest Notification dated 13th September 2018, the following entities also need to deduct TDS-
An authority or a board or any other body which has been set up by Parliament or a State Legislature or by a government, with 51% equity ( control) owned by the government.
A society established by the Central or any State Government or a Local Authority and the society is registered under the Societies Registration Act, 1860.
Public sector undertakings.
What is TCS under GST
Tax Collected at Source (TCS) under GST means the tax collected by an e-commerce operator from the consideration received by it on behalf of the supplier of goods, or services who makes supplies through the operator’s online platform. TCS will be charged as a percentage on the net taxable supplies. The provision of TCS under GST is dealt under Section 52 of the CGST Act.
Who is liable to collect TCS under GST
Certain operators who own, operate and manage e-commerce platforms are liable to collect TCS. TCS applies only if the operators collect the consideration from the customers on behalf of vendors or suppliers. In other words, when the e-commerce operators pay the consideration collected to the vendors they have to deduct an amount as TCS and pay the net amount.
Here are few exceptions to the TCS provisions for the services provided by an e-commerce platform:
Hotel accommodation/clubs (unregistered suppliers)
Transportation of passengers – radio taxi, motor cab or motorcycle
Housekeeping services like plumbing, carpentry etc. (unregistered suppliers)
For example – M/s.XYZ stores (a proprietorship) is selling garments through Flipkart. Flipkart, being an e-commerce operator, before it makes the payment of consideration collected on behalf of XYZ, will be liable to deduct TCS.
What is the rate applicable under TCS
The dealers or traders supplying goods and/or services through e-commerce operators will receive payment after deduction of TCS @ 1%. The rate is notified by the CBIC in Notification no. 52/2018 under CGST Act and 02/2018 under IGST Act.
This means for an intra-state supply TCS at 1% will be collected, i.e 0.5 % under CGST and 0.5% under SGST. Similarly, for a transaction between the states, the TCS rate will be 1%, i.e under the IGST Act.
This document provides notes for the March 2022 attempt of the CAF-02 Tax Practices exam. It includes the syllabus breakdown and weightages, an overview of Pakistan's revenue collection system, a table of contents for the study material, and summaries of key concepts related to the income tax system in Pakistan. Some of the key points covered include the history of Pakistan's tax laws, objectives and tools of taxation, principles of tax levy, characteristics of tax laws, definitions of important tax-related terms, rules around tax year and residential status, geographical sources of income, and the basics of taxing employment income from salary.
OBJECTIVE
Goods and Services Tax (GST) is an Indirect Tax levied in India introduced in July, 2017 which was one of the most important reforms in the Indian Economy. Timely refund mechanism is essential in tax administration, as it facilitates trade through the release of blocked funds for working capital, expansion and modernisation of existing business. In this webinar, we shall understand and analyse the provisions related to Refund under the GST law.
1. The document discusses the Kerala Land Conservancy Act and the roles and responsibilities of revenue officers in protecting public property and preventing encroachment.
2. It outlines the procedures for reporting and evicting encroachments, including the required forms and steps to take possession of encroached land.
3. The punishments for offenses like encroachment, transferring public land through forged documents, abetment, and laxity by officials are described, with fines ranging from Rs. 10,000 to Rs. 2,00,000 and imprisonment from 1 to 7 years.
Self-assessment, provisional assessment, scrutiny of returns, assessment of non-filers and unregistered persons, and summary assessment are the main types of assessments under the Act. The proper officer may conduct audit of registered persons to verify correctness of returns filed. Special audit can also be ordered if the officer feels value or credit availed requires further verification. Audit report findings can initiate proceedings for recovery of short paid tax or erroneously claimed credits.
The document provides information about e-way bills in India. It discusses the objective and need for e-way bills, provisions under law, the e-way bill generation process which involves filling Part A and Part B, validity periods, extensions, cancellations, exceptions and verification process. E-way bills are required for inter-state movement of goods of over Rs. 50,000 in value and aim to facilitate seamless movement of goods and prevent tax evasion. Registered persons need to generate e-way bills on the common portal prior to movement of goods, listing key details of the consignment, supplier and recipient.
This document provides an introduction and overview of the Maharashtra Value Added Tax Act of 2002. It discusses key aspects of VAT including:
- VAT is a multi-stage tax system that taxes value added at each stage of production and distribution, allowing tax credits for taxes previously paid.
- The Act replaced the earlier Bombay Sales Tax Act and came into effect on April 1, 2005, establishing the VAT system in Maharashtra.
- Registration is required if annual turnover exceeds Rs. 1 lakh for traders or Rs. 5 lakhs for manufacturers. Importers must register regardless of turnover.
- Goods are classified into Schedules A-E and taxed at rates from 0-20% depending
This document provides an overview of the Maharashtra Value Added Tax (MVAT) system. It discusses the introduction of VAT globally and in India, as well as an overview of MVAT in Maharashtra. The key aspects covered include the MVAT Act and rules, registration requirements, tax invoices, rates and classifications, input credit/set off rules, payment requirements, returns, and TDS requirements. Methods of calculating VAT liability for normal dealers and works contractors are also summarized.
Registration of MVAT (Maharashtra Value Added Tax)Tushar Kharate
This document provides information about registration under the Maharashtra Value Added Tax (MVAT) Act of 2002. It outlines the types of dealers liable to pay tax, including those with turnover above certain limits. It also details the documents required for initial registration and registration changes, such as proof of business constitution, address, bank account, and payment of fees. Finally, it lists the tax rates for different schedules of goods under the MVAT Act.
VAT (value added tax) has replaced sales tax in India, including in Maharashtra, to establish a uniform, transparent taxation system. VAT is collected from producers and sellers on the incremental value added at each stage of production and distribution. In Maharashtra, VAT is governed by the MVAT Act and applies to the sale of goods at rates from 1-20% according to schedules. Key VAT concepts include the definition of goods, dealers, importers, and sales/purchase prices. Manufacturers and businesses with over 1 lakh annual sales or 10,000 rupees of taxable purchases/sales annually must register and file VAT returns electronically monthly, quarterly, or half-yearly.
AUDIT ASSIGNMENT- M.COM PART II – SEMESTER IV, AUDIT REPORT, CARO 2015, AUDIT REPORT OF JINDAL STEEL & POWER LIMITED, SA 230 AUDIT DOCUMENTATION (REVISED), SA 500: AUDIT EVIDENCE.
VAT (value added tax) is a simple, transparent tax collected on the sale of goods throughout the chain of production and distribution. It is intended to replace sales tax in India. VAT is calculated on the value added at each stage, allowing businesses to claim credits for VAT paid on inputs. This avoids taxing the same goods multiple times under sales tax. The key features of VAT include being paid by the consumer at each point of exchange where value is added, charging tax on the difference between output and input prices, and allowing self-assessment of tax through VAT returns.
This document is a project report submitted by Soumeet Sarkar to the University of Mumbai for their Master of Commerce program. The report focuses on Audit Documentation as outlined in SA 230 and Audit Evidence as outlined in SA 500. The report includes an introduction that provides background on auditing, defines auditing, discusses the origin and development of auditing standards in India and internationally. It then outlines the content which will cover SA 230 on audit documentation and SA 500 on audit evidence.
Service tax is an indirect tax levied on services in India. There is no separate Service Tax Act - it is imposed annually through amendments to the Finance Act of 1994. Service tax applies to the entire country except Jammu and Kashmir. The current rate of service tax is 12% plus applicable cess. Certain services are exempt from service tax under various notifications. The valuation of a service for calculating tax payable is based on the gross amount charged or the monetary value of consideration received. Various rules have been introduced to determine the scope of taxable services and calculate service tax payable for different services and situations.
This document is a project report on Service Tax submitted to the University of Mumbai by Vivek Shriram Mahajan. It contains an introduction to the subject, definitions of key terms, an overview of the need for and authority of Service Tax in India. It discusses some key aspects of Service Tax such as chargeability, the negative list of exempted services, and conclusions. The project report was completed to fulfill requirements for an M.Com degree in Accountancy.
Presentation on service tax Act 1994, for undergraduate commerce students of Goa University. Includes historical background, year wise tax collection e for last 20 years and procedural aspect of service tax Act 1994 with latest amendments are covered.
This document discusses various indirect taxes in India including central sales tax, value added tax, central excise duty, and customs duty. It defines key terms related to these taxes such as incidence and impact of direct vs indirect taxes. It also covers the classification of taxes, authorities that levy different taxes, taxable events, and calculation of taxes. The key highlights are that indirect taxes are imposed on goods and services while direct taxes are imposed on individuals, and indirect tax burden can be shifted to consumers.
The letter requests the issuance of manual C forms to correct errors made in online C forms issued to various companies over the past seven to ten months. Original and duplicate C forms containing incorrect information such as wrong TIN numbers are provided. Issuance of new manual C forms is needed as the online forms cannot be corrected due to the time that has passed. A total of four companies - M/S Inarco Limited, M/S Srivari Cotton Private Ltd, M/S Indian Oil Corporation Ltd, and M/S Sovereign Industrial Products Ltd - require manual C forms to address incorrect information on previously issued online C forms.
Service tax is an indirect tax levied on certain taxable services in India. It is paid by the service provider to the government. Over time, the scope of service tax has expanded to include more services. Its goal is to lower the tax burden on businesses and industry while maintaining government revenue.
The services sector makes up a large portion of India's economy. Imposing service tax on this growing sector allows the government to tax its substantial contribution to GDP. As international trade and manufacturing see reduced tax burdens, service tax helps maintain government revenues. Starting from only three services in 1994, service tax receipts have increased as more services are added.
Service tax is calculated as a percentage of the gross value charged
Sunita Kumari Yadav completed a project report on the company audit of Tirtharoop Electricals Pvt. Ltd. as part of her Master of Commerce program at the University of Mumbai. The report was submitted under the guidance of Mr. Gajanan Wader in 2013-2014. Sunita declared that the work was original and carried out under supervision. It was evaluated and accepted for internal assessment by internal and external examiners. The report included chapters on the company background, accounting records, audit standards and processes, analysis of accounts, and a draft audit report.
The document is a project report submitted by Rutuja Deepak Chudnaik for their M.Com degree. The report focuses on comparing the Payback Method and Internal Rate of Return (IRR) Method for capital budgeting and investment decisions. The report includes an introduction to capital budgeting, the objectives and basic principles. It also provides details on the calculation of payback period for projects with constant and uneven cash flows. The report is submitted to the University of Mumbai under the guidance of their project guide, Prof. Dhiren Kanabar.
Tata Steel is India's largest steel company established in 1907. It is the sixth largest steel producer globally. The report discusses the auditing standards followed by Tata Steel in preparing its financial statements. It analyzes Tata Steel's auditor's reports and identifies the key auditing standards used - SA 220 on quality control, SA 501 on audit evidence for selected items, and SA 610 on using the work of internal auditors. The objectives of the study are to evaluate the effectiveness and adequacy of auditing standards at Tata Steel and analyze its financial discipline and compliance with auditing and accounting standards in India.
This presentation summarizes the key aspects of value-added tax (VAT) in India. It introduces VAT and explains how it differs from other sales tax systems by being levied at multiple points of a product's production and distribution chain. The presentation outlines the history of taxation systems in India, the reasons for changing to VAT, how VAT affects the Indian economy, and compares the advantages and disadvantages of VAT to other systems. Real-world examples of calculating VAT are provided.
This document provides an overview of indirect taxes in India according to Prof. Mohasin Tamboli. It discusses that the central government levies taxes like income tax, excise, and customs, while states levy taxes like local sales tax and excise on liquor. It then focuses on explaining central excise duty - what goods it applies to, who is liable to pay it, registration requirements, valuation methods, and record-keeping obligations.
The document provides an overview of India's income tax system. It discusses that income tax is governed by the central government and levied under the Income Tax Act of 1961. The government taxes various types of individual and business income. Disputes can be appealed through a three-tier system of the commissioner, appellate tribunal, and courts. The government has also implemented measures like the GAAR and equalization levy to address tax avoidance, while transfer pricing remains a controversial area of focus.
Everything You Must know about New Tax Procedure Law of UAE for VAT 2023Horizon Biz Consultancy
As UAE prepares for the implementation of the new Tax Procedure Law for VAT in 2023, our comprehensive guide provides essential insights to help you prepare and succeed. Our complete guide has all the information you need to navigate this important change with confidence. Website: https://www.horizonbizco.com/everything-you-must-know-about-new-tax-procedure-law-of-uae-for-vat-2023/
1) The document discusses the impact of implementing a value added tax (VAT) system in the Indian state of Kerala based on surveys of manufacturers, traders, consumers, and tax officials.
2) It finds that while VAT provides some benefits over the previous tax system for manufacturers in terms of input tax credits, there are still delays in refunds and complications in compliance that prevent full benefits from being passed to consumers through lower prices.
3) The survey of consumers found that most believe prices did not decrease after VAT was introduced, as manufacturers were not able to fully benefit from the system.
4) In the short term, VAT may modestly improve government revenues through better accounting of economic activity, but the
Pre Budget Memorandum 2024-25-Tax Base, Avoidance, Litigations.pptxtaxguruedu
The Pre Budget Memorandum for Union Budget 2024-25 lays out a strategic roadmap for enhancing India’s taxation framework. Addressing critical areas such as tax base expansion, avoidance mitigation, litigation reduction, and Direct Tax Laws rationalization, the memorandum seeks to shape a tax ecosystem that is responsive, fair, and conducive to economic growth.
Analysis of Proposed Amendments in GST Law in Budget 2021NiteshJain148
The document summarizes key proposed amendments to GST law in the Indian Budget 2021. Some of the major changes proposed include:
1. Making supplies by clubs and member societies taxable retrospectively from 2017 to overrule high court judgments.
2. Adding a new condition for availing input tax credit that the supplier must disclose the invoice in their outward supplies.
3. Replacing the requirement for GST audits by professionals with a self-attested reconciliation statement by the taxpayer.
4. Enhancing powers for tax authorities to attach bank accounts and properties in certain proceedings.
This document analyzes the impact of India's proposed Direct Tax Code on money markets. It presents a mathematical model to estimate changes in money supply under the new code. The model considers 4 levels of impact: 1) increased tax compliance from lower compliance costs, 2) higher disposable income from lower tax rates, 3) potential changes in savings patterns due to tax treatment of withdrawals, and 4) effects of equalizing short- and long-term capital gains tax rates. The analysis aims to estimate changes in money supply factors like tax revenue, disposable income, savings rates, and the money multiplier.
This document provides a summary of provisions related to tax collection and recovery in India. It discusses key sections of the Income Tax Act that deal with collection and recovery (sections 220-232). It outlines the legislative history of changes to various sections over time. It then discusses the concepts of an "assessee in default" and levy of interest on defaulted payments. Specific topics covered include when tax is payable, deeming a taxpayer in default, computation of interest on defaulted payments, and how interest is adjusted in cases where the tax demand amount changes over time such as due to appeals.
The document provides an overview of taxation reforms in Bangladesh. It discusses reforms made to direct taxes like income tax, withholding tax, and self-assessment procedures. Reforms to indirect taxes like VAT and customs duties are also outlined, such as widening the VAT net and simplifying customs procedures. Other reforms included expanding the tax base, reforming capital market tax rules, and preventing tax evasion. Recommendations are made around progressive tax rates, a narrow tax base, unequal treatment of rural/urban and private/public sectors, and reducing tax exemptions.
Tax justice from 100 years old income tax law.pdfM S Siddiqui
Roughly 94 per cent of income-tax revenue comes from tax deducted at source. The Tax deduct as source (TDS) has been imposed at border during release of imported goods and services, supply of goods and services to government and corporates entities. This deduction is on gross sales value but not on net profit. The advances taxes are non-refundable and considered as tax on income. In many cases the tax burden are more than 100 percent of the net income of the business enterprises.
CA Vikas singh chauhan gst presentation VMRVIKAS CHAUHAN
The document provides information about Goods and Services Tax (GST) in India. It discusses what GST is, how it replaced other indirect taxes, its key components like CGST, SGST and IGST. It explains the multi-stage nature of GST and how tax is levied at each stage of supply chain. It also outlines the registration requirements for GST, advantages of GST registration and composition scheme. The document lists the various GST return types and their filing due dates. It provides details about the concessional 5% GST rate for renewable energy devices and solar power plants. It highlights benefits of Udyog Aadhaar registration for MSMEs and situations that can lead to GST
MAT or Minimum Alternate Tax was introduced in 1987 to collect taxes from zero tax companies. It levies a tax rate of 15% on the book profits of companies to bring them in the tax net. Companies can claim MAT credit for taxes paid over their normal tax liability which can be carried forward for 15 years. All companies, including those in Special Economic Zones, are required to pay MAT and file MAT reports. The introduction of MAT helps reduce tax evasion and ensures that companies pay a minimum level of tax.
Gst Alert 10 : Changes in registration and return filing normsMeet Raval
The document summarizes recent changes made to key GST rules in India that will impact how taxpayers avail credits and comply. Key changes include:
1) Stricter registration processes requiring Aadhaar authentication and increased processing times from 3 to 7 or 30 days.
2) Increased powers for officers to suspend or cancel registrations for violations like incorrect credit claims or return filing discrepancies.
3) Restrictions on input tax credit claims to 105% of the amount in GSTR 2B from January 2021.
4) Tighter return filing rules preventing filing if earlier returns are not filed and restrictions on using credits if returns are not filed.
5) A new rule restricting the use of
GST Alert 10 Changes in Registration and Return filing normsNiteshJain148
The document summarizes recent changes made to key GST rules in India that will impact how taxpayers avail credits and comply. Key changes include:
1) Stricter registration processes requiring Aadhaar authentication and increased processing times from 3 to 7 or 30 days.
2) Increased powers for officers to suspend or cancel registrations for violations like incorrect credit claims or return filing discrepancies.
3) Restrictions on input tax credit claims to 105% of the amount in GSTR 2B from January 2021.
4) Tighter return filing rules preventing filing if earlier returns are not filed and restrictions on using credits if returns are not filed.
5) A new rule restricting the use of
VIETNAM TAX ISSUES – OUTLOOK ON THE EUROPEAN UNION VIETNAM FREE TRADE AGREEME...Dr. Oliver Massmann
The document discusses several issues related to Vietnam's tax system and opportunities under the EU-Vietnam Free Trade Agreement (EVFTA). It notes inconsistencies in how local tax departments apply tax incentives for businesses and calls for clearer guidance. It also points out complexities for enterprises in complying with the declarations and incentives across different documents. Additionally, it raises concerns about discrimination in value-added tax refunds for businesses with output VAT at 5% compared to exporters. Overall, it advocates for simplifying regulations and ensuring fair and consistent treatment of businesses under Vietnam's tax system.
VIETNAM TAXATION – OUTLOOK ON THE EUROPEAN UNION VIETNAM FREE TRADE AGREEMENT...Dr. Oliver Massmann
The document discusses several issues with Vietnam's taxation system and opportunities presented by the EU-Vietnam Free Trade Agreement (EVFTA). It identifies inconsistencies between central government policies and local tax department practices, contradictory regulations, and complexity in VAT calculation and refund rules that create difficulties for businesses. Implementation of clearer rules and guidelines is needed to resolve tax payment issues, properly apply incentives, and avoid penalties from changing interpretations. The EVFTA is expected to boost investment and trade but also influence Vietnam to adopt more fixed and determined tax rules for greater certainty.
Honourable Finance Minister Nirmala Sitharaman has presented her second Union Budget in the Parliament on 01 February 2020. This Budget focused on bringing a series of measures aimed at promoting investments in the country, creating a world class infrastructure and stimulating economic growth.
We bring you our analysis of Direct Tax proposals announced by the Hon'ble Finance Minister at her budget speech. Some of the key takeaways are highlighted below:
• 15% concessional tax regime for new domestic manufacturing companies will now be applicable to Power-generating companies as well;
• Alternative personal tax regime made available for Individual/ HUFs
• Abolition of Dividend Distribution Tax (DDT);
• Advance Pricing Agreement and Safe Harbour Rules to cover Income Attribution to a Permanent Establishment (PE);
• Thin Capitalization provisions liberalized and have been made inapplicable to a debt provided by PE of non-resident engaged in the business of banking in India;
• TDS on e-commerce transactions;
• TCS on overseas remittances under Liberalised Remittance Scheme (LRS), purchase of overseas tour packages and purchase of goods;
• Threshold of residency for citizens & PIOs visiting India reduced from 182 days to 120 days. Further, definition of ‘Not ordinarily resident’ is also narrowed;
• Donations to charitable institutions made to be pre-filled in IT return form to claim exemptions for donations easily. Further the Income Tax exemption approvals to Charitable Institutions is made subject to renewal every five years
The United Kingdom law firm provides legal services to a company in the UAE. Under the reverse charge mechanism, the place of supply is the UAE even though the law firm is located in the UK. The UAE company accounts for the VAT on the supply by declaring AED 500 VAT on its VAT return. The law firm does not charge or account for VAT since it is located outside of the UAE.
The subject matter experts of VsV Bill 2020 gives presentation about the thorough analysis of the bill, the amendments made and how its going to affect taxpayers (directly or indirectly) in the long run. See More :https://www2.deloitte.com/in/en/services/tax.html
What are the new VAT administrative penaltiesAhmedTalaat127
The Federal Tax Authority (FTA) shared a public clarification on 28th April 2021 about the amendments for provisions under the Cabinet Decision No 40 of 2017 for administrative penalties. VAT penalties include administrative penalties, which mean the monetary fines imposed on a person or an entity by the FTA for breaching the provisions in the Tax Law of UAE. Penalties can easily be avoided by taking the necessary precautions for non-compliance while filing the VAT report. Businesses have more time to review their data and submit an accurate VAT filing and can benefit from up to 70% waiver for their unpaid penalties if they meet the criteria.
This document provides information about credit rating agencies (CRAs) in India. It discusses the key CRAs operating in India - CRISIL, ICRA, CARE, and Duff & Phelps. It outlines the credit rating process, including data gathering, management meetings, rating committee assignment, publication, and ongoing surveillance. It also discusses the importance of CRAs in helping investors assess risk and helping companies raise capital, as well as how CRAs are regulated in India by the Securities and Exchange Board of India (SEBI).
Finance is essential for businesses and can come from internal or external sources. Internal sources include personal savings and retained profits. External sources are from outside the business and include ownership capital from shareholders and non-ownership capital from lenders like banks. Different sources have different benefits and costs. Long-term sources include equity shares, preference shares, and debentures, while short-term sources include trade credit and overdraft facilities. Debentures are debt instruments that allow companies to borrow money from the public over a long period at a fixed interest rate. They do not confer ownership or voting rights but are often secured against company assets.
The securities contracts regulation act hardcopyDharmik
This document provides an overview of the Securities Contracts Regulation Act (SCRA) presented by a group of students. It defines securities and discusses key aspects of the SCRA, including:
- The SCRA empowers the central government or SEBI to recognize stock exchanges, approve exchange rules/bylaws, regulate listings, and register intermediaries.
- Contracts must occur through a recognized stock exchange in notified states/areas to be legal. Contracts in violation of exchange rules are void.
- The government can prohibit contracts in certain securities to prevent speculation and require licensing of dealers in some non-notified states.
- Listing on an exchange provides liquidity, mobilizes
Singhania system technologist pvt ltd.hard copyDharmik
Singhania System Technologists Pvt. Ltd is an Indian company established in 2000 that provides combustion solutions and products to various industries. It has over 400 installations in India and abroad. The company aims to meet customer requirements through quality products and services. It has various departments including managing director, human resources, accounting, purchase, and technical. The company motivates its 67 employees through leadership development programs and good organizational culture.
This document provides an overview of secondary markets, including:
1) It defines a secondary market as a market where securities are traded after being initially offered to the public, and describes how it comprises equity and debt markets.
2) Key characteristics of secondary markets are discussed, including trading on exchanges and over-the-counter, realizing capital gains, and providing liquidity.
3) The roles of brokers and sub-brokers in facilitating secondary market trades are outlined.
4) Risk management processes used by SEBI like varying margins and circuit breakers are summarized.
Rbi catalyst in the economic growth in india - hard copyDharmik
The Reserve Bank of India (RBI) plays a catalytic role in India's economic growth through its traditional and developmental functions. As the central bank, RBI regulates money supply and credit through tools like bank rate, cash reserve ratio, and moral suasion. It also promotes growth by developing the agricultural, industrial, and financial sectors through specialized institutions. Recent data shows increasing savings, investment, manufacturing growth, and corporate profits, indicating higher and sustainable economic expansion. However, there are some doubts about the inclusive nature of this growth.
National Insurance Company Ltd. and Metlife Insurance Company Ltd. were the topics of a presentation for a 5th semester T.Y.B.F.M. insurance fund management class at K.E.S’s SHROFF College of Arts & Commerce. The presentation was submitted to Prof. Mandar for the 2012-13 academic year and was prepared by a group consisting of 7 students including Priyank Darji, Hardik Nathwani, Shashank Pai, Sagar Panchal, Dharmik Patel, Kush Shah, and Siddarth Tawde.
This document provides information about a group presentation on loans and project appraisal given by six students to their professor. It defines what a loan is, discusses different types of loans including term loans, secured and unsecured loans, and home loans. It also outlines the features of term loans, types of restrictive covenants lenders place on borrowers, and how collateral like liens or mortgages can be used to secure loans.
The bond market facilitates the issuance and trading of debt securities between savers and organizations requiring capital. It includes government and corporate bonds. The international bond market allows entities to raise funds outside their domestic market, issuing bonds in foreign currencies. Eurobonds are a type of international bond issued in currencies other than the issuer's domestic currency, giving flexibility in choice of market. They are issued by international syndicates and have small denominations and high liquidity.
Hindustan Unilever Limited (HUL) is India's largest fast-moving consumer goods company. It has a turnover of Rs. 17,523 crores and touches the lives of two out of three Indians. HUL focuses on sustainability through its brands, employees, society, and investors. It engages in various corporate social responsibility activities related to health, hygiene, education, and women's empowerment. HUL aims to integrate social, economic, and environmental considerations into its business and brands.
The document discusses group decision making processes. It defines group decision making as when multiple individuals collectively analyze problems, consider alternative solutions, and select a solution. The document outlines several key aspects of group decision making, including:
- Groups can range in size from 2-7 people and members may be demographically similar or diverse.
- Groups use structured or unstructured processes to discuss alternatives and arrive at decisions.
- Factors like group size, composition, and external pressures impact group functioning.
- Common group decision making methods include brainstorming, consensus building, and nominal group technique.
- Group decision making has advantages like tapping diverse expertise but also risks like groupthink.
This document contains a presentation on fundamental analysis given by a group of students at K.E.S’s SHROFF College of Arts & Commerce. The presentation covers various aspects of fundamental analysis including meaning, tools, qualitative factors related to companies and industries, and an introduction to financial statements. Fundamental analysis involves analyzing the financial statements and health of a business, its management and competitive advantage, as well as the markets and economy. The presentation defines key terms and ratios used in fundamental analysis such as P/E ratio, dividend yield, and discusses how to analyze industries and companies.
1. The document discusses ethics in the insurance sector and provides an overview of the Indian insurance industry. It defines key concepts like ethics, different types of insurance (life and general), and the financial system of insurance planning.
2. It explains the history and regulations of insurance in India, including the nationalization of life and general insurance. It also outlines the roles and responsibilities of various entities in the insurance sector like agents, brokers, and companies.
3. The conclusion emphasizes the growing opportunities and importance of the insurance industry in India's economic development by helping customers meet their long-term financial needs.
The document discusses equity markets and capital markets in India. It provides information on primary and secondary markets, and the types of investors and companies that participate in equity markets like investment companies, portfolio management companies, mutual funds, insurance companies, and institutional investors. It also discusses the key players that facilitate equity trading like share brokers, depository participants, and registrars. The growth of the Indian economy and equity markets is summarized.
This document provides information about credit rating agencies (CRAs) in India. It discusses the key CRAs operating in India - CRISIL, ICRA, CARE, and Duff & Phelps. It outlines the credit rating process, including data gathering, management meetings, rating committee assignment, publication, and ongoing surveillance. It also discusses the importance of CRAs in helping investors assess risk and helping companies access financing. The regulator SEBI lays down governance guidelines for CRAs in India.
The document discusses the American financial crisis of 2007-2008. It provides background on the subprime mortgage crisis in the United States, which began with rising mortgage defaults in 2007 and led to a global financial crisis. Risky subprime loans were packaged and sold as complex financial derivatives. This caused systemic banking crises as losses mounted. The crisis spread from the housing market to the broader economy, shaking global financial stability. Key factors that contributed to the crisis included reckless lending practices, a culture of greed, cheap credit availability, and the bundling of risky subprime assets into complex securities.
Tata Motors launched the Tata Nano in 2008 as the most affordable car in the world, starting at about $2,500. The 3-door hatchback seats 4-5 people and gets about 35 mpg. It faced some opposition over environmental concerns but was praised as an eco-friendly and affordable people's car. While the Nano provided opportunities for India's economy and auto market, Tata Motors also faced challenges including relocating production from West Bengal state due to land disputes. However, the Nano demonstrated Tata's innovative engineering and helped establish India as a center for affordable vehicles.
The document discusses creativity in advertising. It defines creativity and outlines its objectives. Creativity involves generating novel and useful ideas through processes like divergent and convergent thinking. In advertising specifically, creativity is key to developing attention-grabbing campaigns that can decide the fate of a product. The document also examines techniques that can be used to enhance creativity, such as combining unrelated ideas and suspending judgment of ideas initially. Fostering creativity in organizations can lead to benefits like innovation, improved products/services, and increased productivity.
Advertising campaign and creativity in advertisingDharmik
This document provides an overview of a term paper submitted by Sevya Kumari for her Master's degree program. The term paper focuses on advertising campaigns and creativity in advertising. It includes sections on advertising campaigning, the creative process in advertising, and various case studies of successful advertising campaigns. The document outlines the contents of the term paper, which examines topics such as the different types of advertising campaigns, the steps involved in campaign planning and creation, and elements of creative advertising including appeals, copywriting, and visualization.
This document provides an overview of the retail market in India. It discusses different types of retail formats including department stores, discount stores, warehouse stores, convenience stores, hypermarkets, supermarkets, and e-tailers. It also covers various retail marketing techniques like internet marketing, direct marketing, word-of-mouth marketing, and public relations marketing. Additionally, it introduces the 7Ps of marketing which are important considerations for retailers - product, price, promotion, place, people, process, and physical evidence. The document aims to give readers an understanding of the Indian retail landscape and key aspects of retail marketing.
Anny Serafina Love - Letter of Recommendation by Kellen Harkins, MS.AnnySerafinaLove
This letter, written by Kellen Harkins, Course Director at Full Sail University, commends Anny Love's exemplary performance in the Video Sharing Platforms class. It highlights her dedication, willingness to challenge herself, and exceptional skills in production, editing, and marketing across various video platforms like YouTube, TikTok, and Instagram.
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The APCO Geopolitical Radar - Q3 2024 The Global Operating Environment for Bu...APCO
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How to Implement a Strategy: Transform Your Strategy with BSC Designer's Comp...Aleksey Savkin
The Strategy Implementation System offers a structured approach to translating stakeholder needs into actionable strategies using high-level and low-level scorecards. It involves stakeholder analysis, strategy decomposition, adoption of strategic frameworks like Balanced Scorecard or OKR, and alignment of goals, initiatives, and KPIs.
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Mvat & cst
1. Management Accounting Indirect Tax
MVAT
INTRODUCTION
1. VAT AND THE CENTRAL TAXES: (article written in 2002)
VAT is introduced in India. What is nature of true VAT and how it is
proposed to be introduced in India? How it will affect the Central Sales
Tax? What measures are necessary to make VAT palatable to Economists
as well as politicians? We have tried to get answers to all such queries with
reference to Vat in Maharashtra.
VAT Council of States, the body of State Finance Ministers and Standing
Council Of Commissioners have agreed that the VAT should be
implemented all over India From 1-4-2001. However, subsequently, after
taking into consideration the fact that the groundwork is still in progress, the
date has been extended to 1-4-2002.One thing is certain that the word
‘VAT’ [Value Added Tax] is a symbol of Globalization and Liberalization,
which is a universal phenomenon for the current age, is bond to be
implemented in India.
MBA SEMESTER 1 1
2. Management Accounting Indirect Tax
2. SUCCESSFUL TAX SYSTEM:
Among many other things, the successful tax system always tries to avoid
Cascading effect of the tax. The VAT, being Value Added Tax, it presupposes
That, if the tax is levied on sale value, all the taxes paid while making
purchases as Well as all the taxes paid during the process of manufacture or
import are to be Refunded. The CREDIT method or INVOICE method of VAT
system ensures that the taxes shown in the purchase bills are given the credit
to the dealers. The Uncontrolled incidence of tax always shrinks the industry
and trade and keeps Away from the developing process of the national
economy. The tax system has to be neutral so far as its effect on the choice of
inputs and outputs for the Manufacturer and choice of the goods for a
consumer is concerned.
At the same time multiplicity of the rates has to be removed in a model
system of Taxation. That’s why the Finance Ministers Committee has agreed
to keep the Number of rates to four. Widespread taxation encourages the
vertical integration of Industries and thus discourages small-scale ancillary
industries. Heterogeneity in the structure of tax, that is having different taxes
like Sales Tax, Turnover Tax, Surcharge, Additional Tax, makes the system
so much complicated that either There is tendency towards evasion or it
makes a way for clashes between the Administration and the assesses.
MBA SEMESTER 1 2
3. Management Accounting Indirect Tax
3. STEPS TOWARDS VAT:
3.1 As pointed above VAT Council of States, and Standing Council of
Commissioners have agreed that the VAT should be implemented from
1-4-2002. It was also agreed that there should be floor rates common to
all the States. Though Maharashtra State had introduced the floor rates
from 1-1 2000.But due to the pressure from people they were corrected
on 13-1-2000 and 22-1-2000. However some fine-tuning of the
classification has yet to be done Giving another look at the grouping of
the goods in to four-rate categories and Floor-rates.
3.2 Abolition of the tax-related incentives scheme is another step in the
direction of Bringing VAT in to operation. In fact the States have taken
this opportunity to Stop the incentives to be given in the name of
Backward Area. This will not only Raise the revenue of the States but
will also put end to the war among the States In the form of harmful
competition of reducing tax rates to give tax incentives.
3.3 Draft model of VAT legislation has been prepared by the National
Institute of Public Finance and Policy. The circulation of papers on VAT
will certainly be creating the atmosphere towards readiness to accept
VAT.
MBA SEMESTER 1 3
4. Management Accounting Indirect Tax
4. EXPERIENCE OF VAT IN MAHARASTRA:
4.1 During the period from 1-10-1995 to 31-3-1999 Maharashtra had VAT
in a Limited sense. Initially the limit covering the dealers under VAT was
Rest. One Core but was brought down on 1-7-1997 to Rest. 40 laces.
Though the additional Tax and Turnover Tax was abolished the rates
were over all increased to cover those taxes [most of the goods taxable
at 10% were taxed at 13%]. Some 12 Industries and 100% export units
were allowed the full set-off of the sale tax Paid on inputs.
4.2 It is said that the VAT was abolished from 1-4-1999 due to fall in the
Sales Tax Revenue. But the Economists do not agree to such
reasoning. Since there was a General recession in the industry during
1996 to 1999 the govt could not have expected the increase in the tax
revenue on implementation of VAT. In fact the fall in the tax revenue
augmented by the set-off policy of giving refund to Manufacturers
manufacturing tax-free goods, 100% exporting Units, 12 Preferred
industries and reduction in the burden of taxes on inputs from 4% to 3%
to all manufacturers. The decision to abolish Vat in Maharashtra was
thus a Non-economic one, tinted with political surroundings.
MBA SEMESTER 1 4
5. Management Accounting Indirect Tax
Assessment under VAT
In Maharashtra state Bombay Sales Tax has been replaced by VAT from
1-4-2005. Attempt is made in this article to visualize the process of
assessment under MVAT Act. The real picture will be clear only after 2
years when the actual process of assessment will start.
1. Long awaited VAT has seen the light of the day on 1-4-2005. Much was
advertised by The Govt about the VAT. By now the time for submission
of first return is over and the dealers as well as practicetioners in
taxation, after filing the first return, are thinking of the stage of
‘assessment’ to come.
2. SELF ASSESSMENT AND NOTICES:
Right from Mr. Chidambaram & Mr. Asim Das to Mr. Jayant Patil had
said several times that the VAT brings the era of ‘Self assessment’. But
the Maharashtra Value Added Tax Act 2002 [MVAT Act] does not
contain a single provision about self assessment of Acceptance of
returns except only Margin-heading of section 20. But this section 20 is
in fact Is a provision for submission of returns. On the contrary under old
Act, section 33[2] of BST Act 1959, in clear words provided that if the
Commissioner is satisfied that the returns are Correct and complete he
may assess according to the returns. Thus MVAT Act is more
Regressive than the BST Act.
The section 21 of the original MVAT Act was for self assessment. It
provided for the intimation to be given about the dues or refund. It had
also provided that if such intimation is Not received by the dealers, the
acknowledgement of the returns will serve as the intimation. This means
that the acknowledgement is the evidence of acceptance of the returns.
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But now amended section 21 does not provide, neither for assessment
as per returns nor for the acceptance of the returns. Section 21 provides
only for a restriction that the notice for assessment can not be issued
after 2 years if the returns are filed in time; and after 3 years if the
returns are not filed by the prescribed date. [However this limit is
extended Upto 4 years In case of the period ending on 31-3-2008.] But
what is the position of returns and assessment if the said notices are not
issued is not clearly mentioned anywhere in MVAT Act.
3. ASSESSMENT OF DEALERS:
The assessment in particular is provided in section 23 of MVAT Act.
Surprisingly it starts with the provision for assessment in cases of
defaulters, as if the defaulters will be the order of the day in VAT regime.
Under section 23[1], if the dealer files the return late, the Commissioner,
[that is, the STO/AC/DC], will pass expert assessment order without
issuing any notice and without any
Opportunity of hearing. Such order can not be passed after three years.
The power to pass the Best judgment assessment order against the
principles of natural justice may be the singular
Model among 126 countries where the VAT is said to have been
introduced. The power of passing the order against the dealer without
calling him and without giving hearing may Be the meaning of
‘transparency’ much published in White Paper and the Govt advertisements
about VAT. If such expert order is passed by the STO/AC/DC, then the only
way out for the
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Dealer is to file the writ in the High Court because under section 85[1][1-
b] such order is non appealable. If the dealer has filed the return and
has paid the taxes then he can put the application in form 304 attaching
the proof of submission of return and payment of taxes. Thereafter the
STO/AC/DC will cancel the expert assessment order passed by him if
the payment of tax was made before issue of notice. If the payment of
tax is made after issue of the notice how it will affect the expert
assessment and total payment of taxes is not clear in the MVAT Act.
This section 23[1] is the best example of excessive delegation of the
powers granted to STO/AC/DC to pass the order without notice and take
it back if on his satisfaction. Looking In to the big volume and the task
involved in collection of returns from the Banks and their Dispatch to the
respective STO/AC/DC and the present experience in this respect, it is
very evident that the new source of enormous work will be created for
the STO/AC/DC.The dealers who have filed the returns in time will be
assessed u/s 23[2]. By issue of notice in form 301 [similar to old form
27], the STO/AC/DC can call for the evidence on the basis of which the
returns are filed by the dealer and after considering that evidence he will
pass the assessment order. The date fixed for hearing should not be
less than 15 days from the date of service [rule 21 of MVAT Rules
2005]. The assessment order will be in form 303 [similar to old form 30].
The notice can be served at any time but the assessment order can not
be passed after the expiry of 3 years from the end of the year containing
the period which is being assessed. The dealers who have filed the
returns late will be assessed u/s 23[3]. But notice in form 301 has to be
served with in 3 years and the assessment order has to be passed
within 4 years. The dealers can be assessed for the unregistered period
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u/s 23[4] by issue of notice in form 301 within 5 years but such
assessment order has to be passed within 8 years.
4. ASSESSMENT OF TRANSACTION:
Section 23[5] provides for the assessment of the transaction or of the
claim. The prescribed authority for this sub-section is not the
Commissioner but, the STO. AC, DC, or Sr. DC is prescribed authorities
under Rule 21[2]. The notice in form 302 [rule 21] can be issued to the
dealer if the prescribed authority is satisfied that the tax is being evaded
by not recording or by incorrect recording the transactions or any claim
in incorrectly made. Even if the notice for regular assessment is issued
by the STO/AC/DC, the notice under this sub section can be issued. If,
during the search, the STO/AC/DC finds that the tax is being evaded,
then the visiting officer can make the assessment of such transaction,
even though the proceedings are not transferred to him u/s 59. The
assessment order can be passed separately for each transaction. If
there are 100 bills which could not be explained by the dealer to the
satisfaction of the visiting offer at the time of visit, there will be 100
assessment orders in a single year. This is unique provision giving
powers to the visiting officer who takes the search of the premises of the
dealer to assess the dealer though he may not be within his jurisdiction.
[Good example of excessive delegation to bureaucracy]. The
STO/AC/DC having a regular jurisdiction can also take up the regular
assessment of the dealer. Thus there will be two or more assessing
authorities for one dealer, assessing the same period with out any
transfer of proceedings. MVAT Act has really provided the polyandry in
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the days when even polygamy is condemned. However the MVAT Act is
very kind to provide that no tax will be levied again in the regular
assessment if it is already levied in transaction-wise assessment
[proviso to sec 23[5][d]].
5. RE-ASSESSMENT BEFORE ASSESSMENT:
The MVAT has found out, for the first time in taxation history of
Maharashtra, the concept of reassessment of escaped turn over before
the assessment. Section 23[6] gives powers to the STO/AC/DC to
assess the dealer who in his opinion has,
- Not disclosed the turn over of sales or purchases in the returns,
- paid tax at a lower rate,
- set-off has been wrongly claimed,
- any deduction has been wrongly claimed.
Notice in form 315 [similar to old form 28] is to be issued for this purpose
and 15 days time from the date of service, has to be given for hearing [rule
21]. Though the notice in from 301 & 302 for assessment can not be issued
after 2 years in case of dealer filing returns in time and 3 years in case of
defaulters, the notice in form 315 for deemed reassessment u/s 23[6], can
be issued with in 5 years from the end of the period which is to be
assessed. The assessment order under this section has to be passed
within 6 years. Looking into the past experience about allowance of claims
and the dispute about rate of tax, each and every dealer is likely to be
covered by 4 defaults mentioned above. Therefore the limit of 2 or 3 years
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kept for assessment will be meaning less and all the dealers will be
covered by the time limit of 6 years, though they commit bonafide mistakes.
6. FRESH ASSESSMENT AFTER REMAND:
Where the appeal is filed against the assessment order, the appellate
authority [except Tribunal] has no power to remand the case for fresh
assessment. In case the Tribunal remands the case for fresh
assessment, the assessing authority has to complete the same within 36
months as provided in section 23[7]. The period of 36 months can be
counted from the date of supply of the copy of the appeal order by the
dealer to the assessing authority.
7. DIRECTIONS BY THE COMMISSIONER:
A novel provision has been made in the MVAT Act for seeking the
directions of the Commissioner during the course of assessment. A
dealer can apply in form 305 to the Commissioner [likely to be delegated
to Jt. Commissioner] seeking his guidance in any assessment case. The
Commissioner can examine the matter, hear the dealer and then give
directions as to the completion of the assessment. Such directions will
be binding on the STO/AC/DC. The practical utility of this provision can
be very much disputed because at one Place the Commissioner is
empowered to pass the orders contrary to the law laid down by the
Tribunal and if that is the policy, the chances are very rare that the
directions will in favour of the dealer.
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8. SINGLE ORDER FOR DIFFERENT PERIODS:
A provision is made u/s 23[10] for issue of single notice for different
periods and passing of single order for different periods if all such
periods are comprised in one year. It is not clear from the Rules as how
the notice in form 301 and 315 which are differently worded and for
different purposes, can be issued in one single piece even if the different
periods are covered by one and same year.
9. UNFETTERED OMNI-POWER OF THE MONARCH:
In the biggest land of democracy, where the rule of law is implemented
through the Constriction, the MVAT Act 2002 gives unfettered powers of
the monarch to the Commissioner [in turn to STO/AC/DC]. Section 23[8],
which is the sub section of provisions related to assessment, gives
powers to the Commissioner to call for record of any matter. Mind the
words ‘matter’ and not ‘assessment’, which will mean he can call for any
file of assessment, appeal, revision, grant of registration certificate or
issue of documents etc. He can also call for the evidence from the
dealer. And thereafter he can pass appropriate order. The meaning of
the word ‘appropriate’ is very well known to the persons practicing in
taxation. The order to be passed by him need not be ‘just & proper’.
Thank the Creator that the provision is made for the hearing of the
concerned. There is no time limit for issue of notice or for passing the
order. No statutory notice is provided in this sub-section nor is any form
prescribed for notice. For assessment, reassessment or review different
time limits from 2 years to 8 years are provided, but for this sub-section
the matter is open till eternity. The ‘appropriate’ order under this sub-
section can be the order which is totally and wholly against the law laid
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down by the Tribunal, if the Govt is in reference or appeal against that
decision before the High Court or Supreme Court.
Again thank the Creator that he has made the provision that the recovery
can not be effected in pursuance of such order passed u/s 23[8] till the
High Court or Supreme Court decides the issue. REALLY, THE KING IS
VERY KIND !
Rectification under VAT
The provisions relating rectification under MVAT Act 2002, which is in
force in Maharashtra State, are discussed in the article.
By N.T.Nirale, M.A. M.Com. LL.B. D.M.S. Advocate
RECTIFICATION
In the earlier article, we have seen the assessment provisions under
VAT Act. When the assessment is over, the next step is concerned with
the corrections to be made in the assessment order. From the view point
of the dealer, two important corrective measures are Rectification and
the other Appeal. Section 24 provides for Rectification and section 26
provides for Appeals.
RECTIFICATION OF APPARENT MISTAKE -
The mistake is apparent when it is very clear and glaring. That means to
expose the mistake, long drawn arguments are not necessary. Time limit
- Rectification provisions u/s 24 of VAT Act are almost similar to old
section 62 of the BST Act. Section 24[1] fixes the time limit of 2 years
from the end of a financial year in which the order is passed. Who can
apply - Any person can bring to the notice of the commissioner any
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mistake. Similarly the commissioner can suomoto rectify the mistake.
Procedure - If the rectification is resulting in demand then it is
compulsory of the Commissioner to give reasonable opportunity of
hearing to the dealer. Even if the application of rectification is to be
rejected if there is no mistake, the hearing is necessary. Stay of
recovery - Provision is also made for stay of recovery if the application
for Rectification is pending. But later on, if the dues are confirmed then
there will be interest the stay order will be in form 308. Forms - As per
Rule 27 the Commissioner has to give notice in Form 306 before
Passing the rectification order. As per Rule 28, the dealer has to make
application for rectification in form 307. There is no Court Fess for
rectification application. There is form 311 for application requesting
Stay order in appeal proceedings but there is no form of application for
stay in rectification proceedings. The stay order for rectification is in
Form 308.
RECTIFICATION OF MISTAKE WHICH IS NOT APPARENT -
New provision was made from 1-7-2004 in BST Act for the mistake,
which was not apparent. Similar provision is incorporated in section
24[2]. If the dealer has claimed any deduction for sales against
declarations or certificates and he has not received the same till the time
of assessment, then even if that claim is disallowed and the tax is levied
on the same, the dealer can apply, with in 2 years from the
end of the financial year in which that assessment order was received,
for rectification if receives those declarations or certificates.
If the dealer wants to take advantage of this type of rectification, then he
should not have filed the appeal. This suggests that if he had filed the
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appeal and at the time of hearing of appeal, he had not received the
declarations, then he cannot go for rectification if he receives the
missing declarations within two years. For such rectification, the
Commissioner has to give hearing and verify the forms and allow the
same.
The dealer can take advantage of this type of rectification only one time
for one assessment order. So it is advisable to wait for 23 months and
then file the application for rectification on account of receipt of missing
forms.
RECTIFICATION BY APPELLATE AUTHORITIES:
Provision is made in section 24[3] for rectification of the mistakes made
by appellate authorities. The provisions of rectification applicable to
assessing authority are also applicable to mistakes to be rectified by
appeal authorities. However the proviso to section 24[3] is very
threatening. It empowers the appellate authority to rectify any mistake
though that particular point was not challenged in the appeal. This
means any point, which is not raised in appeal, can also be rectified by
the appellate authority. This proviso was not in the old section 62 BST
Act and is introduced for the first time. This proviso to section 24[3]
overrides the entire VAT Act. Does this mean that the time limit of two
years will not apply to the actions of rectification under proviso to section
24[3] is question which is not easy to answer. Perhaps this will be
another example of unfettered powers of the Monarch as pointed out in
my earlier article on assessment provisions. It is to be seen whether the
dealer can, on application, take the benefit of this proviso to section
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24[3].Thank the Creator that he has made the provision in section 24[4]
for refund of the amount found to be paid in excess.
APPEALS under VAT
The provisions relating appeals under MVAT Act 2002, which is in force in
Maharashtra State, are discussed in the article N.T.Nirale, Advocate In
a leading case of Hoosier Kamas Dada the Supreme Court has pointed
out that the right to appeal is not merely a matter of procedure; it is a
matter of substantive right. [4 STC 114]. Right to appeal is vested in a
dealer when the return is filed or on the date, the return was due. In
case of Vijay Parsed [72 STC 324 SC], Hon Justice Sabyacachi Kukri
has said, “Right to appeal is neither an absolute right nor an ingredient
of Natural Justice. Right to appeal is a statuary right which is
circumscribed by the conditions of grant”. VAT drafters are very kind that
they have provided for right of appeal under section 26 and 27 of VAT
Act. To whom appeal lies:
The provisions of section 26 govern the right of appeal under VAT Act,
which is similar to old section 55 of BST Act. If the order is passed by
the STO or AC the appeal can be filed to the Deputy Commissioner of
Sales Tax. If it is passed by the DC or Sr. DC then the appeal will lie to
Joint Commissioner. If the order is passed by the Jet. Commissioner,
Addle Commissioner or the Commissioner then it will lie to the Tribunal.
[The copy of the notification changing the designations of the Sales Tax
authorities is not yet available with the PRO of the Sales Tax dept. It is
said that all Class I STOs will be designated as ACs, all ACs will be
designated as DCs and all DCs will be designated as Jet.
Commissioners. After introduction of VAT, one has not yet experienced
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the increase in transparency, but there is certainly increase in the
nominal structure of the authorities due to introduction of VAT.] The
second appeal against the order passed in appeal by the DC or JT.
Commissioner will lie to the Tribunal. Unlike to old provision giving
option to file second appeal either to Commissioner or to the Tribunal,
new provision of section 26[2] provides the second appeal only to the
Tribunal.
Non-appeable Orders:
All orders are not appeable but section 85[2] bars filing of appeal
against certain notices and order viz. --
i] Any notice,
ii] Summons,
iii] Exparte assessment order where any Return is not filed by the dealer by
the prescribed date,
iv] Installment order,
v] notice or order for recovery as arrears of land revenue,
vi] seizure order,
vii] order transferring the proceedings,
viii] part payment and stay order passed by appellate authority.
[Though the appeal against the part payment order is barred, the admission
of appeal is not dependent of the payment of the part payment amount.]
As under old law, under new VAT Act also, all appeal orders are final, but
they can be reviewed [revised] u/s 25 or rectified u/s 24 of VAT Act. The
time limit for filing the appeal is 60 days from the date of communication
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of the order appealed against. The power of the appellate authority to
condone the delay in filing the appeal for sufficient cause is not taken
away under VAT Act. [See how kind is the King !] The provisions of
section 4 & 12 of Limitation Act are made applicable by section 80 of
VAT Act and the power to condone the delay is granted by section 81 of
VAT Act. However, the delay cannot be condoned on the ground that
any judgment or decision, on which reliance is placed, was delivered
after the limitation period was over.
Powers under appeal:
The powers of appellate authorities u/s 26[5] have been classified under
four categories, viz.
a] Appeal against assessment orders - In this case the appellate authority
gets the power to confirm, reduce, enhance or cancel the assessment.
The power to remand the case is only with the Tribunal. It can only direct
to make fresh assessment of the appellant.
b] Appeal against the penalty, the appellate authority gets the power to
confirm or cancel , or modify the penalty. The words “ in accordance with
the provisions of the Act” are added under VAT Act, these words were
not in the BST Act. When the appellate authorities are the officers
appointed under the Act for the carrying out the purposes of the Act,
there is no significance to the newly added words. Only the time will
show the purpose of this addition.
c] Appeal against the interest - Here the appellate authority gets the power
to confirm, cancel or modify it in accordance with the provisions of the
act.
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d] In case of appeal of any other kind, the appellate authority gets the
power to pass ‘just and proper order.’ The BST Act section 55[7] had
provided that the appellate authority could pass the appeal order against
the point decided by the Tribunal, if the State had gone in reference
against that decision to High Court. But VAT Act does not provide so in
section giving powers to appellate authority. However section 23[8]
provides for passing the appropriate order of assessment even against
the judgment of the Tribunal. Whether this power can be used by the
appellate authority is a question to be decided.
Power to grant Stay:
The appellate authority has u/s 26[6], a power to grant stay against the
operation of the order appealed against. He can ask for the part
payment and can put some conditions before granting such stay.
Priorities and Senior citizen:
In India, the law does not recognize a person of particular age to be
senior citizen. For railway concession, Sr. Citizen should be 60 old, but
for income tax, he should be 65 old. According VAT Act {proviso to
section 26[7]}, the person does not become old unless he attends age of
75 years. As per section 26[7] the appeals are to be decided on the
prescribed priorities, but the rules have not yet prescribed the list of
priorities. If the proprietor, partner or a director has attained the age of
75 years, as per Rule 34, he can apply in form 313, for the
disposal of his appeal on priority.
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Appeal to High Court:
Section 27 of VAT Act provides for appeal to High Court against the
order of the Tribunal. Under sec 61 of BST Act it was called Reference,
and it was to be routed through the Tribunal. Now, against the Tribunal
decision, the appeal can be directly filed to Bombay High Court.
However, such appeals are restricted to the points of Law only. Thus,
Tribunal is still a final body on the points of Facts. However, unlike to the
reference, the High Court can now decide the issue, which has not been
determined by the Tribunal. The High Court has no power to grant stay
when the appeal is filed to High Court. The Tribunal has to give the
effect to the judgment of the High Court.
Power to assess the turn over under any other Law:
Section 28 of VAT Act gives unique power to assess the turn over under
any other Law. If the appellate authority sets aside, any assessment on
the grounds that it should have been assessed under any other law
other than the law under which it was assessed, then such turn over can
be by the Sales Tax authorities. The time limit of 5 years is put for
correction of such assessments. Imagine an example where the AC
levies tax on certain transaction and the dealer files appeal to DC. In
appeal, if the DC finds that the tax cannot be assessed on that
transaction, as it is a ‘service’ transaction on which the service tax could
have been levied. Do the wordings of section 28 suggest that the Sales
Tax authorities get the power to levy service tax, which is a Central tax,
is the question calling attention. If the answer is no, then the purpose of
such power to assess the turnover related to ‘Other Law’ is beyond
imagination of the man of ordinary prudence.
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Procedure for appeal:
The appeal has to be filed in form 310. It is felt that under VAT the appeal
cannot be filed on plain paper giving all the details required by VAT Rule 31.
Under BST Rule 58 it was provided that the appeal should be ‘as far as
possible in accordance with Form 37’ but VAT Rule 31 is differently worded
and it says that, ‘the appeal including second appeal shall be made in form
310’. The details and enclosures to be given in appeal form are almost similar
to old form No. 37 of BST Act. If the dealer wants stay order against the
recovery as per order appealed against, the application in form 311 is to be
made to appellate authority. The stay order will be issued inform 312. This
form 312 is like old admission - cum - stay order. When the admission is not
conditional on payment of the dues, it is not understood why this order is
called as ‘admission memo cum stay order’? Before the stage of final hearing,
the appeal can be summarily rejected under Rule 35, if the appeal memo
omits to give the particulars required or if the authenticated copy of order is
dispute is not enclosed or any other sufficient ground. But before rejecting the
appeal summarily, the opportunity of hearing has to be given to the appellant
to correct the omissions. The application for restoration can be made within 30
days. If the appellate authority is satisfied that the notice of hearing was not
served on him or that, he was prevented by sufficient cause from amending
the appeal memo or from appearing, then the summery rejection order can be
set aside and the appeal can be restored. If the appellate authority does not
pass any order on the restoration application within 30 days, it will be
presumed that the appeal is restored. {Look how kind is the creator?}
As per Rule 36, the intimation of fixing appeal for final hearing has to be
given 10 days in advance. If any date is to be given, it should be after 10
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days, unless the appellant agrees for earlier date. If on the date fixed the
appellant remains absent the appeal can be decided expert. Such expert
appeal order can also be restored on application if it is found that the
notice was not served or that there was sufficient cause for his absence.
Rule 36[2] expects the appellate authority including the Tribunal, to
maintain the Register showing the date of filing of appeal and the
disputed quantum in that appeal.
Rule36[4] prescribes that the appellate authority including the Tribunal
should in any month fix 50% appeals which are against the DDQ orders
passed u/s 56 and old appeals and 50% out of appeals involving highest
quantum of relief sought.
Copy of the appeal order:
The certified copy of appeal order is to be supplied free of cost by the
appellate authority to the appellant as per Rule 37, and one copy has to
be sent to the officer against whose order was appealed.
Award of Costs by Tribunal:
Rule 38 of VAT Rules empowers the Tribunal to award the costs at its
discretion. However, before awarding the costs the dealer or the person
against whom the costs are being awarded has to be given the
opportunity of hearing.
Court Fees:
Rule 73 prescribes the court fees to be paid. The appeal memo requires
the CF of Rs. 100/- if the amount of relief is less then Rs. 1 lac. If it is 1
lac or more then the CF is equal to 10% of the relief or maximum Rs.
1000/-. Where there is no amount in dispute the CF will be Rs. 100/-.
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There is no distinction as to first or second appeal or appeal to Tribunal.
The CF for restoration application is Rs. 10/-. The CF for stay application
is Rs. 25/-.On application by Sr. Citizen for taking, the appeal on priority
there is no CF.There is no CF for application of condonation of delay.
The adjournment application and the miscellaneous also do not require
CF.
Amendments to MVAT Act
1. Brand Name: Sec. 2 (3-a) w.e.f. 20-6-2006 : Except two entries in
Schedule A this phrase is not used in any other schedule . The newly
inserted definition of brand name is restrictive as it is defined for the
purpose of schedule only. It states ‘ “brand name" when used in the
Schedule means a brand name, (whether registered or not), that is to
say, a name or a mark such as a symbol, monogram, label, signature or
invented words or any writing which is used in relation to a product for
the purpose of indicating, or so as to indicate, a connection in the course
of trade between the product and some person using such name or
mark with or without any indication of the identity of that person.
2. Purchase price: Sec. 2(20) w.e.f 1-4-2005: Explanation IV added to
definition of purchase price is contrary to the circular issued by
Commissioner (28T 20-9-2005) regarding grant of setoff. It was decided
that, when tax has been paid at the time of the first sale on the MRP of
medicines and subsequently the medicines are sent on inter-State
consignment, the reduction of 4% would be effected only on the actual
purchase price of the dealer making the inter-State consignments. The
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new explanation states that ‘The amount of valuable consideration paid
or payable by a dealer for the purchase of drugs specified in entry 29 of
Schedule C shall be the maximum retail price printed on the package
containing the drugs; “The retrospective amendment may prove
burdensome for dealers who have claimed benefit of earlier circular.
3. Works contract defined : Sec. 2 (24)(b)(ii) w.e.f. 20-6-2006: So far
what is works contract was not defined under MVAT Act though CST Act
did provide for definition in 2002. The definition of sale is amended.
Transfer of property in the works contracts mentioned in the new
definition only would be subject to tax namely, an agreement for carrying
out for cash, deferred payment or other valuable consideration, the
building, construction, manufacture, processing, fabrication, erection,
installation, fitting out, improvement, modification, repair or
commissioning of any movable or immovable property. The new
definition is similar to the definition of the term in K. Raheja’s case and
will open flood gates of litigation.
4. Registration: Sec. 3 w.e.f. 20-6-2006. In sub-sections 4 & 5 of sec.
3:The word Turnover is replaced by ‘Turnover of sales’. The reference to
turnover of purchase is deleted. Thus it is now crystal clear that turnover
of sales only would be determining the liability for registration under
MVAT Act.
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5. Liability to Register: Sec. 3 w.e.f. 20-6-2006. Sub-section 7 of sec. 3
is deleted as a result now the dealer registered under C S T Act will be
liable for registration only on exceeding the prescribed turnover under
MVAT Act else he can obtain voluntary registration by paying Rs. 5,000
fees.
6. Developer of the Special Economic Zone Sec. 8 w.e.f. 20-6-2006: A
unit in SEZ will also include a Developer of the Special Economic Zone.
The explanation ‘e’ added to sec. 8(3) includes developer to mean (i)
undertaking development, repairs, maintenance and improvement of the
Special Economic Zone, and (ii) who has been certified by the
Commissioner ;
The scope of dealers eligible for exemption is enhanced. Similarly New
explanation ‘f’ further enhances the scope of exemption. A SEZ unit now
includes an establishment situated within the Special Economic Zone.
This would promote and facilitate the sales amongst the SEZ units.
7. Sales to dealers specified in export trade policy Sec. 8 (3A) w.e.f.
20-6-2006: This amendment empowers the State Government by
general or special order, published in the Official Gazette, and subject to
such conditions, exceptions and restrictions as may be specified in the
said order, to exempt from payment of tax any class or classes of sales
of goods made by any registered dealer to any class of dealers specified
in the Export Trade Policy notified from time to time, by the Government
of India.
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25. Management Accounting Indirect Tax
8. Sales to Canteen Stores Department Sec. 8 (3B) w.e.f. 20-6-2006:
This amendment empowers the State Government, by general or
special order, published in the Official Gazette, and subject to such
conditions, exceptions and restrictions, as may be specified in the said
order, to exempt fully or partly, from .payment of tax any class or classes
of sales of goods made by
a. Any registered dealer to the Canteen Stores Department or the Indian
b.The Canteen Stores Department or the Indian Naval Canteen Services to
the unit run canteens or members of the Armed forces,
c. The unit runs canteens to the members of the Armed forces.
Please refer to Notification VAT-1505/178/taxation-1 dt. 27th July, 2006
9. Sales to the State Government, the Central Government etc., Sec. 8
(5) w.e.f. 20-6-2006: Newly inserted sub-section 8(5) empowers the
State Government by general or special order, published in the Official
Gazette, and subject to such conditions and restrictions, if any, as may
be specified in the said order to exempt fully or partly, from payment of
tax, any sales or classes of sales of goods made by any registered
dealer to,—
a. The State Government,
b. The Central Government,
c. A generating company, as defined in the Electricity Act, 2003, for
use in generation of electricity,
d. A registered dealer, holding a licence for transmission under the
Electricity Act, 2003, for use in transmission of electricity,
MBA SEMESTER 1 25
26. Management Accounting Indirect Tax
e. A registered dealer, holding a licence for distribution of electricity under
the Electricity Act, 2003, for use in distribution of electricity,
f. the Mahanagar Telephone Nigam Limited,
g. the Bharat Sanchar Nigam Limited,
h. any telephone service provider, holding a licence granted under the
Indian Telegraph Act, 1885 and the Indian Wireless Telegraphy Act,
1933, to establish, maintain and operate telephone services up to
subscribers terminal connection. Please refer to
NotificationVAT/1505/192/Taxation-1 dt. 28th July, 2006
10. Registration Sec. 16(6) Shifting of POB w.e.f. 20-6-2006: As a result
of this amendment now merely for shifting of place of business the
Registration granted u/s 16 will not be cancelled. The Explanation
appended to this sub-section is deleted as redundant.
11. Separate returns by different branches /units Sec. 20(2) w.e.f. 20-6-
2006: Despite the provision of one T I N NO for all branches of a dealer
in Maharashtra, looking to the practical problems of the dealers this sub-
section is substituted. Now the Commissioner may, subject to such
terms and conditions, as may be prescribed, permit any dealer to file
separate return:—
MBA SEMESTER 1 26
27. Management Accounting Indirect Tax
A. For all or any of the places of business of the dealer, whether or not
situated within the jurisdiction of the same registering authority, or
B. For different constituents of his business to such authority as he may
direct.
12. Revised returns Sec. 20(4) w.e.f. 20-6-2006: The time for filling
revised return is extended to eight months to facilitate filling of revised
returns as a result of audit.
13. Where to file a fresh return or a revised return- Sec. 20(5) w.e.f. 20-
6-2006: As per this new sub-section where a dealer is required to file a
fresh return or, as the case may be, a revised return, he shall file such
fresh or revised return with the authority prescribed and if any amount of
tax is required to be paid in accordance with such fresh or revised
return, then he shall pay such amount in the Government Treasury and
attach a self attested true copy of the receipted challan with the fresh or
revised return.
14.Limitation for Assessment Sec. 21 w.e.f. 20-6-2006: By this
amendment the Assessing Authority can now issue notice for
assessment within a period of six years from the year containing the
said period. This provision shall apply to any period ending before 31st
March, 2008.
15.Business Audit Sec. 22 w.e.f. 20-6-2006 : An amendment is made to
this section by which the Officers conducting business audit can visit any
MBA SEMESTER 1 27
28. Management Accounting Indirect Tax
day after the day fixed for Business Audit.
16. Cancellation of ex parte Assessment Sec. 23 (11) w.e.f. 20-6-2006 : By
this beneficial amendment a dealer who has been assessed ex parte
under sub-section (2), (3) or (4) can make an application in the
prescribed form to the Commissioner within thirty days of the date of
service of the assessment order, for cancellation of the assessment on
the ground that he had not been able to attend or remain present before
the Commissioner at the time of hearing when the assessment order
had been passed. The Commissioner shall, after verifying that the
contention of the applicant is correct and that the prescribed conditions
have been fulfilled, cancel, by order in writing, the said assessment
including any penalty or interest levied in relation to or in consequence
of the said assessment and shall make a fresh assessment in
accordance with the provisions of sub-section (2), (3) or (4), including
levy of interest or penalty, as the case may be. It is also provided that,
only one application for cancellation shall be entertained under this sub-
section in respect of any period of assessment.
17.Contravention of conditions of Exemption Sec. 29(5) w.e.f. 20-6-
2006: This new sub-section provides for levy of penalty on purchasers
eligible for exemption u/s 8 (3), (3A), (3B), or (5) for failure to comply
with the conditions or restrictions subject to which the exemption is
granted. The penalty is prescribed as equal to one and a half times the
tax which would have become payable on the sale if the said exemption
MBA SEMESTER 1 28
29. Management Accounting Indirect Tax
was not available on the said sale.
18.TDS Provisions Sec. 31 w.e.f. 20-6-2006: Few small but important
amendments are made to TDS provisions.
i. It is now specifically provided to exclude not only tax but also service tax
component for determining the amount subject to TDS .
ii. The certificate for no deduction of tax will be issued by the
Commissioner of Sales Tax only when the contract is not works
contract.
iii. Certificate referred to in ii above once issued can be amended or
modified by CST later on his own motion.
iv. Employers who are not notified will not be granted permission for TDS
v. The credit for TDS can be claimed by the contractor in the period in
which the certificate for payment is furnished to him by the person
deducting tax in accordance with the provisions of this section.
vi. Requirement of obtaining TDS number as also of filling annual TDS
return is done away with by deleting sub sections 8 and 10 of sec. 31.
19.Exemption to petroleum dealers Sec. 41 (4) w.e.f. 1-4-2005: As per
this amendment the State Government may, by notification in the Official
Gazette, provide for exemption from the payment of full or part of the tax
MBA SEMESTER 1 29
30. Management Accounting Indirect Tax
payable, Subject to such conditions as it may impose on the sales of
motor spirits and petroleum products made by an oil company to another
oil company and also on sales at retail outlets of motor spirits, other than
aviation turbine fuel and aviation gasoline.
As clarified by the Explanation.— for the purposes of this sub-section,
motor spirits and petroleum products shall mean such products as the
State Government may, notify from time to time, in the Official Gazette.
20.Composition under Sec. 42 w.e.f.20-6-2006: The effect of few
amendments made to sec. 42 are as follows:
i. The turnover of liquor/country liquor will be excluded to arrive at the
amount eligible for composition for hoteliers
ii. New composition scheme is now provided for vendors of various types
of liquor
iii. New works contract composition now allows composition as (a) equal to
five per cent of the total contract value of the works contract in the case
of a construction contract, and (b) eight per cent of the total contract
value of the works contract in any other case, after deducting from the
total contract value of the works contract, the amount payable towards
sub-contract involving goods to a registered sub-contractor.
iv. The explanation provides for following definitions:
a. “construction contract“ shall mean construction contract as may be
notified by the State Government in the Official Gazette, from time to
MBA SEMESTER 1 30
31. Management Accounting Indirect Tax
time, and
b. the amount payable towards sub-contract involving goods “ means the
aggregate value of the goods on which tax is paid and the quantum of
said tax paid by the sub-contractor or the sub-contract value on which
tax by way of composition is paid by the sub-contractor, as the case may
be.
v. A dealer who is liable to pay tax on sales effected by way of the transfer
of the right to use mandap or tarpaulin (whether or not for a specified
period), may, subject to such conditions and restrictions, as may be
prescribed, pay in lieu of the amount of tax payable by him a sum equal
to one and half per cent of the turnover of sales effected by him.
For the purposes of this sub-section, the transfer of the right to use mandap
includes the transfer of the right to use mandap, pandal, shamiana or the
decoration of such mandap, pandal or shamiana and the transfer of the
right to use furniture, fixtures, lights and light fittings, floor coverings,
utensils and other articles ordinarily used along with a mandap, pandal or
shamiana as per the Explanation.
21.Adjustment of refund Sec. 50 w.e.f. 20-6-2006: The refund under the
MVAT Act shall be available only as per order By Commissioner of
Sales Tax. If a registered dealer has filed any returns, fresh returns or
revised returns in respect of any period contained in any year and any
amount is refundable to the said dealer according to the return, fresh
return or revised return, then subject to rules, the dealer may adjust
such refund against the amount due as per any return, fresh return or
revised return for any subsequent period contained in the said year, filed
MBA SEMESTER 1 31
32. Management Accounting Indirect Tax
under this Act or the Central Sales Tax Act, 1956 or the Maharashtra
Tax on the Entry of Goods into Local Areas Act, 2002.
22.Grant of Refunds Sec. 51 w.e.f. 20-6-2006: The procedures and
conditions for grant of refund are drastically amended. Please refer to
the latest detailed circular by Commissioner of Sales Tax dt. 1-8-2006
23. Interest on delayed refund Sec 53 w.e.f. 20-6-2006: As per this
amendment if an amount required to be refunded by the Commissioner
to any person, by virtue of the provisions contained in section 51 or by
virtue of an order passed under any other provision of this Act, is not so
refunded to him within ninety days of the end of the respective period
provided in section 51 or, as the case may be, of the date of the said
order, the Commissioner shall pay such person simple interest at the
prescribed rate on the said amount from the date immediately following
the expiry of the period of ninety days to the date of the refund.
24.Electronic records Sec. 86(5) w.e.f. 1-4-2005: Under this sub section
the Commissioner can on receipt of application by any dealer permit him
to maintain the records of the bills or cash memorandum on such
electronic system as may be approved by the Commissioner. On such
permission being granted, the dealer shall stand exempted for the
purposes of sub-section (3) regarding keeping counterfoils or duplicates
of the said bills or cash memoranda and of signing the bill or cash
memorandum.
MBA SEMESTER 1 32
33. Management Accounting Indirect Tax
25.On going Works Contracts—Sec. 96 (g) w.e.f. 1-4-2005: Section 96
of the MVAT Act, is amended with effect from 1st April, 2005. The
contractors executing ongoing contracts in the VAT period are now
required to pay tax as per the rates prescribed under the repealed
Works Contract Act, 1989. In other words, if the contractor is paying 4%
composition under Repealed Act, he has to pay the same amount of tax
under the VAT Act. (Sec. 96(g)) and he will not get any setoff. This
amendment is made retrospective w.e.f. 1-4-2005.
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34. Management Accounting Indirect Tax
CST
Introduction
Objects and Basic Scheme of the CST Act, 1956
The objects of the Act, as stated in preamble of the CST Act are -
To formulate principles for determining (a) when a sale or purchase takes
place in the course of inter-state trade or commerce (b) When a sale or
purchase takes place outside a State (c) When a sale or purchase takes place
in the course of imports into or export from India
To provide for levy, collection and distribution of taxes on sales of goods in
the course of inter-state trade or commerce
To declare certain goods to be of special importance in inter-State trade or
commerce and specify the restrictions and conditions to which State laws
imposing taxes on sale or purchase of such goods of special importance
(called as declared goods) shall be subject.
As explained later, * Entry 92A of List I (Union List) empowers Central
Government to impose tax on inter-state sales * Article 269(3) and Article
286(2) of Constitution authorises Parliament to formulate principles for
determining when the sale or purchase takes place outside a State or in the
course of imports and exports. * Article 286(3) of Constitution authorises
Parliament to place restrictions on tax on 'declared goods'.
CST Act imposes the tax on inter state sales and states the principles and
restrictions as per the powers conferred by Constitution.
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35. Management Accounting Indirect Tax
Basic scheme of the CST Act - The basic scheme of the CST Act is as
follows.
SALES TAX REVENUE TO STATES - The CST Act provides for levy on Inter-
State sales and also defines what is ‘Inter-State Sale’. However, the concept
that revenue from sales tax should be collected by States has been retained.
Thus, though it is called Central Sales Tax Act, the tax collected under the Act
in each State is kept by that State only. This is provided in Article 269(1)(g) of
Constitution of India. - - CST in each State is administered by local sales tax
authorities of each State.
TAX COLLECTED IN THE STATE WHERE MOVEMENT OF GOODS
COMMENCES - The scheme of CST Act is that Central Sales Tax is payable
in the State from which movement of goods commences (i.e. from which
goods are sold). The tax collected is retained by the State in which it is
collected. CST Act is administered by Sales Tax authorities of each State.
Thus, the State Government Sales Tax officer who collects and assesses
local (State) sales tax also collects and assesses Central Sales Tax.
TAX ON INTER STATE SALE OF GOODS - CST is tax on inter State sale of
goods. Sale is Inter-State when (a) sale occasions movement of goods from
one State to another or (b) is effected by transfer of documents during their
movement from one State to another.
STATE SALES TAX LAW APPLICABLE IN MANY ASPECTS - CST Act
makes provisions for very few procedures and rules. In respect of provisions
like return, assessment, appeals etc., provisions of General Sales Tax law of
the State applies.
MBA SEMESTER 1 35
36. Management Accounting Indirect Tax
CST ACT DEFINES SOME CONCEPTS - Under the authority of Constitution,
the CST Act defines concepts of ‘Sale Outside the State’ and ‘sale during the
course of import/import’.
DECLARED GOODS - Some goods are declared as goods of special
importance and restrictions are placed on power of State Governments to levy
tax on such goods.
Inter-State and Intra-State Sale - Entry 92A of List I - Union List reads : ‘Taxes
on the sale and purchase of goods other than newspapers, where such sale
or purchase takes place in the course of Inter-state trade or commerce’. Entry
54 of list II - State List - reads : ‘Tax on sale or purchase of goods other than
newspapers except tax on Inter State sale or purchase’. Thus, sale within the
State (Intra-State sale) is within the authority of State Government, while sale
outside State (Inter-State sale) is within the authority of Central Government.
Sale where both buyer and seller are from same State is Intra-State sale e.g.
from * Mumbai to Pune or * Ahmedabad to Surat * Howrah to Kolkata *
Mysore to Bangalore etc. These are Intra-State sales. However, when buyer
and seller are in different States, it is Inter-state sales. e.g. : Chennai (Tamil
Nadu) to Trivandrum (Kerala) * Allahabad (UP) to Hyderabad (Andhra
Pradesh) * Bhubaneshwar (Orissa) to Daman (Union Territory) etc.
NEWSPAPER SPECIFICALLY EXCLUDED - It can be seen that
‘newspapers’ are specifically excluded from purview of both Union as well as
State list. The obvious reason is that newspapers have a very vital role to play
in a democratic society. Freedom of speech and free flow of information is the
backbone of democracy and hence newspapers have been excluded from tax.
[Otherwise, ‘newspaper’ are ‘goods’, but for the exclusion].
MBA SEMESTER 1 36
37. Management Accounting Indirect Tax
TAXABLE EVENT IN SALES TAX - In re Sea Customs Act - AIR 1963 STC
437= (1964) 3 SCR 827 (SC 9 member bench), it was held that in case of
sales tax, taxable event is the act of sale. It is not a tax directly on goods.
Categories of Sales - Sales can be broadly classified in three categories. (a)
Inter-State Sale (b) Sale during import/export (c) Intra-State (i.e. within the
State) sale. - Murli Manohar and Co. v. State of Haryana (1990) 4 CLA 304
(SC) = (1991) 80 STC 79 = 1990(2) SCALE 821 = (1991) 1 SCC 377 (SC 3
member bench). In this case, it was observed that they cannot conceive fourth
category of sale.
If sale or purchase to Marketing Agency is in same State, it will be an Intra-
State sale even if goods are despatched outside the state as per instructions
of the marketing agency. - ACC v. CST - AIR 1991 SC 1122.
Tax on Inter-State sale is levied by Union (i.e. Central) Government while tax
on Intra-State sale is levied by State Government of the State in which sale
takes place. No tax is levied on sales during import or export.
SALE WITHIN THE STATE IS ‘RESIDUARY SALE’ – As we will see later,
‘sale within State’ is residuary sale. Thus, first we have to decide if sale is
‘Inter State’. If not, we have to find if it is ‘Sale during export or import’. If not,
then the sale is ‘Intra State’. Thus, if a sale is Inter State of during export or
import, it cannot be ‘Sale within the State’.
MODE OF A SALES TRANSACTION - Initially, buyer places an order on
seller for supply of goods, called ‘Purchase Order’. After the goods ordered
are ready, the buyer may come to the business place (godown, factory or
warehouse) of seller and obtain delivery of goods. This will be ‘Sale within the
State’. Alternatively, buyer may ask seller to send the goods by transport. In
MBA SEMESTER 1 37
38. Management Accounting Indirect Tax
such cases, the seller will book the consignment by rail, road, ship or air as
per requirement of buyer to the destination where buyer requires the goods. In
such a case, generally, (a) if buyer and seller are in the same State, it is Intra-
State sale (b) if they are in different States, it is Inter-State sale (c) if buyer is
outside India, it is sale during export (d) if seller is outside India, it is sale
during import.
Recovery from customer is not essential for sales tax – Normally, sales tax is
treated as indirect tax as it can be and is usually recovered from buyer.
However, the liability to pay tax is on the dealer, whether or not he collects if
from buyer.
Background of CST
Sales Tax is one of the most important Indirect Tax for purpose of taxation by
State Governments. Revenue from CST goes to State from which movement
of goods commences. Total CST revenue in 98-99 was Rs 8,538 Crores.
Revenue of some major States was - Maharashtra - Rs 1,442 Crores.
Tamilnadu - Rs 934 Crores. West Bengal - Rs 799 Crores. Gujarat - Rs 787
Crores, Haryana - Rs 739 Crores. [ET, Bom 21.7.2000].
CST is proving to be a hindrance in introducing VAT. CST has been reduced
to 3% (from 4%) w.e.f. 1-4-2007. It is announced that it will be reduced by 1%
every year and made Nil by 1-4-2010.
CST RATES
Rate of Central Sales Tax
CST rate w.e.f. 1-4-2007 in case of sale to registered and unregistered dealer
- Position w.e.f. 1-4-2007 is as follows –
MBA SEMESTER 1 38
39. Management Accounting Indirect Tax
In case where local sales tax rate is 4%, CST applicable in case of sale to
unregistered dealer will be only 4% as against 10% as was applicable upto
31-3-2007. In case of sale to registered dealers, the CST rate will be 3%.
In case where local sales tax rate is 12.5%, CST applicable in case of sale
to unregistered dealer will be 12.5%. This position is same as was applicable
upto 31-3-2007. In case of sale to registered dealers, the CST rate will be 3%.
In case where local sales tax rate is 1 to 3%, CST applicable in case of sale
to unregistered dealer will also be 1 to 3%, as against 10% as was applicable
upto 31-3-2007. The rate will be 1% even when sale to unregistered dealer is
by transfer of documents. In case of sale to registered dealers, the CST rate
will be 1 to 3% as applicable to the goods within the State.
In case where local sales tax is Nil, CST applicable in case of sale to
unregistered dealer will also be Nil. This position is same as was applicable
upto 31-3-2007. In case of sale to registered dealers, the CST rate will be Nil.
Sale to Government will be equivalent to sale to unregistered dealer w.e.f. 1-
4-2007
Welcome change – The change is really welcome. In case of goods where
State sales tax rate is 4%, if the buyer does not furnish C form, the selling
dealer will be liable to pay tax @ 4% instead of 3%. So far, in such cases, he
was required to pay CST @ 10%, which was indeed a very heavy penalty.
Thus, risks involved in not getting C form from buyer have been considerably
reduced.
In view of this, harassment in getting blank C form from department and
‘charges’ payable for getting blank C forms should come down. Of curse,
MBA SEMESTER 1 39
40. Management Accounting Indirect Tax
provision of submitting C form on quarterly basis continues. Thus, ‘expenses’
involved in getting blank C forms from department cannot be avoided.
Of course, the tax burden is heavy where local sales tax rate is 12.5%, since
in that case, the selling dealer will have to pay CST @ 12.5%, instead of @
3%, if the buyer fails to furnish C form.
Sales tax rate for sale
within the State
CST rate in case of
sale to registered
dealers
CST rate in case of
sale to unregistered
dealers
NIL NIL NIL
1% 1% 1%
2% 2% 2%
3% 3% 3%
4% 3% 4%
8% 3% 8%
10% 3% 10%
12.5% 3% 12.5%
20% 3% 20%
Note – Usually, State Vat rates of 2%, 3%, 8% and 10% do not exist.
However, these rates are given only to explain the principle.
State sales tax to be inclusive of additional tax / surcharge / turnover tax -
Many State Governments have introduced ‘Additional Sales Tax’, turnover tax
or surcharge on tax. It has been held that this additional sales tax is also sales
tax for purposes of deciding the rate of duty.
Goods included in central sales tax
MBA SEMESTER 1 40
41. Management Accounting Indirect Tax
Sales tax liability is on ‘goods’. Section 2(d) of CST Act defines that ‘goods’
includes all materials, articles, commodities and all kinds of movable property,
but does not include newspapers, actionable claims, stocks, shares and
securities. Following should be noted.
Goods must be ‘movable’ - Goods includes all movable property. It includes *
steam - Nizam Sugar Factory Ltd. v. CST - (1957) 8 STC 61 (AP HC) *
Electrical energy - CST v. MP Electricity Board - (1970) 25 STC 188 (SC) *
animals and bird in captivity - K J Abraham v. Asst. STO - (1960) 11 STC 291
(Ker HC) * Goods include uprooted trees, second hand goods, rejected goods,
worn out goods etc.
NO TAX ON IMMOVABLE PROPERTY - Section 3(14) of General Clauses
Act define that ‘Immovable property’ includes land, benefits arising out of land
and things attached to the earth or permanently fastened to anything that is
attached to the earth. However, as per section 2(7) of Sale of Goods Act,
goods include standing crop, grass and things attached to and forming part of
the land, which is agreed to be severed before sale or under contract of sale.
No tax on Newspapers though they are ‘goods’ - Newspapers are in fact
‘goods’, but are specifically excluded in view of entry No. 92A of List I to
Seventh Schedule to Constitution of India (Union List) where newspapers are
specifically excluded from purview of tax on inter-State sales of goods. It may
also be noted that entry 54 of List II (State List) authorises States to levy tax
on sale of goods other than newspapers only. Weeklies and magazines like
‘Illustrated Weekly of India’ and ‘Eastern Economist’ have been held as
‘newspaper’. - A H Wheeler and Co. (P.) Ltd. v. State of Bihar - (1960) 11 STC
18 (Bihar Board).
MBA SEMESTER 1 41
42. Management Accounting Indirect Tax
Supreme Court in Printers (Mysore) Ltd. v. Asst. CTO - JT 1994 (1) SC 692 =
(1994) 93 STC 95 (SC) = (1994) 9 MTJ 444 (SC), has held that though
newspapers are not liable to CST, they can purchase their raw materials at
concessional rate on submission of C form.
Goods of intangible character are ‘goods’ - Goods of incorporal or intangible
character like patents, lottery ticket, advance licenses, copyright can be liable
to sales tax.
Can there be inter-state sale of intangible goods ? – Goods must move
physically from one State to another to constitute an inter-state sale. In case
of sale of advance license/DEPB, the license/pass book can physically move
from one State to another. However, in case of certain intangible goods like
patent, copyright and trade mark, there is no physical movement of goods
from one State to another. These goods cannot be said to be located at a
particular place. In view of this, it seems that sale is concluded at a place
where agreement of sale is executed, as property in ‘goods’ can be said to
have passed in that State.
Plant & machinery assembled at site is not ‘goods’ - Plant and Machinery or
structure assembled and erected at site cannot be treated as 'goods' for the
purpose of levy of sales tax, if it is not marketable and movable. Following
case law would be relevant, even if it is under Central Excise.
Recent amendments
Recent Changes – Following are recent change in CST Law.
12th
May 2000 - Following changes were made vide Finance Act, 2000,
effective from 12-5-2000.
MBA SEMESTER 1 42
43. Management Accounting Indirect Tax
PROVISION OF INTEREST ON DELAYED PAYMENT - Section 9(2) and
9(2A) were amended to provide for recovery of interest for delayed payment of
Central Sales Tax (CST). Section 9(2B) was inserted to provide that
provisions in general sales tax law of each State relating to due date of
payment of tax, rate of interest for delayed payment and assessment and
collection of interest, shall apply to assessment and recovery of interest on
Central Sales Tax also. As per section 120 of Finance Act, 2000, the
provisions were given full retrospective effect.
The word 'interest' was not present in section 9(2) earlier. In - India Carbon
Ltd. v. State of Assam 1997(5) SCALE 51 = (1997) 106 STC 460 (SC) =
1997(6) SCC 479 = 1997 AIR SCW 3091 = 26 CLA 152 = AIR 1997 SC 3054
= (1998) 8 CC (Reports) 276 (SC), it was held that that interest for delayed
payment cannot be levied on CST. (Since, there was no provision under CST
Act). The section 9(2) of CST was amended with retrospective effect to nullify
the effect of the judgment.
11th
September 2001 – Provisions in respect of Central Sales Tax Appellate
Authority have been introduced by adding sections 19 to 26 w.e.f. 11-9-2001.
The Appellate Authority has been constituted on 3-12-2001. - - However, the
sections have not been made effective till April, 2003.
11th
May 2002 - Substantial and far reaching changes have been made in
CST Act, vide Finance Act, 2002. Some of these are made to facilitate
introduction of VAT provisions in sales tax, while some are made to overcome
difficulties created by some Supreme Court Judgments. Major changes made
by Finance Act, 2002 are as follows -
WIDENING OF DEFINITION OF SALE - Definition of ‘sale’ is amended by
including (i) Transfer other that by contract (compulsory transfer) (ii) Goods
MBA SEMESTER 1 43
44. Management Accounting Indirect Tax
involved in Works contract (iii) Transfer of right to use goods (like - leasing)
(iv) Transfer among members of unincorporated association (v) Supply of food
articles [Hire purchase was covered earlier also [New section 2(g)]. So far,
there was no CST for inter state transactions of works contract, leasing or sale
of food articles.
Since there was no CST on leasing transactions, dealers were avoiding sales
tax by showing transaction as ‘inter state sale’. Only lease agreement was
executed in one State while goods were delivered in another State. Now, even
if lease is held as inter state, CST will be payable.
F FORM MADE MANDATORY TO PROVE STOCK TRANSFER -
Submission of ‘F’ form to prove stock transfer made mandatory. If not
furnished, the transfer will be treated as occasioned as a result of sale. [So
far, stock transfer could be proved by other evidence also] [Amendment to
section 6A(1)]
CST RATE 3% OR LOCAL SALES TAX RATE WHICHEVER LOWER IF
UNDER C FORM - Section 8(1) is amended to provide that rate of CST to
registered dealer will be 3% or at the rate applicable for sale within the State,
whichever is lower. Section 8(2) has been amended to provide that if certain
goods are exempt generally from state sales tax, CST payable on such goods
will be Nil, even if sold to unregistered dealer.
STATE GOVERNMENT CANNOT WAIVE CONDITION OF C/D FORM -
Section 8(5) empowers State Government to reduce the sales tax rate
applicable in Inter State Sale, by issuing a notification. This section has been
amended to provide that such reduction can be given only after fulfilling
conditions of section 8(4), i.e. on submission of C/D form. Section 8(5)(a) and
8(5)(b) are also amended to provide that the State Government can reduce
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45. Management Accounting Indirect Tax
CST rates only for sale to registered dealers / Government. Thus, reduction in
CST rate made by State Government will apply only if sale is to registered
dealer / Government. The lower rate will not apply if sale is to unregistered
dealer (as he cannot provide C form).
Person liable to pay CST
Section 8(1) specifies that every dealer who in the course of inter State trade
or commerce sales the goods shall be liable to pay tax under the Act. Thus,
liability is on the dealer who 'sells' the goods.
Dealer - Section 2(b) defines that “dealer” means any person who carries on
(whether regularly or otherwise) the business of buying, selling, supplying or
distribution of goods, directly or indirectly, for cash, or for deferred payment, or
for valuable consideration, and includes (a) a local authority, a body corporate,
a company, any cooperative society, club, firm, Hindu undivided family or
other association of persons which carries on such business (b) a factor,
broker, commission agent, del credere agent, or any other mercantile agent,
by whatever name called, and whether the same description as herein before
mentioned or not, who carries on the business of buying, selling, supplying or
distribution, goods belonging to any principal whether disclosed or not and (c)
an auctioneer who carries on the business of selling or auctioning goods
belonging to any principal, whether disclosed or not and whether the offer of
the intending purchaser is accepted by him or by the principal or a nominee of
principal.
There are two explanations to the definition of ‘Dealer’. Explanation 1 states
that a mercantile agent, agent handling goods, agent for collection of payment
and every branch or officer in a State of a firm of Company which is outside
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46. Management Accounting Indirect Tax
the State is also a ‘dealer’. Explanation 2 states that ‘Government’ is also a
dealer except in case of sale of old and discarded stores or waste.
Government as dealer - Explanation 2 to section 2(b) clarifies that
Government, which, whether or not in the course of business; buys, sells,
supplies or distributes; goods, directly or otherwise, for cash or for deferred
payment or for commission, remuneration or other valuable consideration
shall be a dealer.
The exception is sale, supply or distribution of un-serviceable or old stores or
old materials or waste products or obsolete or discarded machinery or parts or
accessories. This exception is made as all Government departments have to
make such sale of old goods. However, this exception is only to Government
and not for private enterprises. Public Sector Undertakings (PSU i.e.
Government Companies) are not ‘Government’ and hence are not exempted
under this clause.
GOVERNMENT CAN BE DEALER IF SPECIFICALLY INCLUDED IN THE
DEFINITION OF ‘DEALER’ – In State of Uttar Pradesh v. UOI 2003(130) STC
1 (SC judgment dated 4-2-2003), the definition of dealer was inclusive
definition and it read ‘Dealer includes Government which (whether in the
course of business or otherwise) undertakes buying, selling, supplying or
distribution of goods. - - In view of this definition, it was held that Department
of Telecommunications (DOT) which is supplying telephone is a ‘dealer’.
‘Carrying on business’ is not required. [in view of specific definition]
Ancillary, incidental and casual business is also covered - It has been held
that any activity which is incidental or ancillary to the main business also
constitutes business and thereby the person engaged in such business
becomes a dealer - Member, Board of Revenue v. Controller of Stores AIR
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47. Management Accounting Indirect Tax
1989 SC 1468 = (1989) 74 STC 5 (SC). In State of Orissa v. Orissa Road
Transport Co. Ltd. 1997 AIR SCW 3489 = 107 STC 204 = (1997) 5 SCALE
589 = AIR 1997 SC 3409 (SC 3 member), it was held that occasional sale of
disposable un-serviceable spare parts at yearly interval by a transport
company would make the organisation 'dealer'. [Decision on basis of definition
under Orissa Act, but relevant for CST].
Club as a dealer – A members’ club whether incorporated or unincorporated is
a ‘dealer’ and will require registration. – Cosmopolitan Club v. State of Tamil
Nadu 1999(115) STC 183 (TNTST) * All India Skin & Hides Tanners v. CTO
(1999( 115) STC 388 (TNTST). [Article 366(29A)(e) of Constitution of India
specifically states that supply of goods by unincorporated body to its members
will be ‘sale’].
Collection of tax only by registered dealer - A 'register dealer' means a dealer
who is registered under CST Act. [section 2(f)]. Section 9A specifies that only
a registered dealer can collect taxes in respect of sales made by him in Inter
State Trade. He can collect taxes only according to CST Act and rules.
Further, a person who is not a registered dealer cannot collect any amount
representing as CST.
C-form
Forms for Declarations
A dealer has to issue certain declarations in prescribed forms to
buyers/sellers. These forms are prescribed in Central Sales Tax (Registration
and Turnover) Rules, 1957. Out of these forms, forms C, E-I, E-II, F and H are
printed and supplied by Sales Tax authorities and are supplied by them.
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48. Management Accounting Indirect Tax
Dealer has to issue declarations in the forms printed and supplied by the
Sales Tax authorities only. These forms are in triplicate. [Form D was to be
issued by Government and can be printed/typed by the Government
department making purchases. Now form D has been abolished w.e.f. 1-4-
2007].
Declaration in Form C - As per section 8(1)(b) of CST Act, sales tax on Inter
State sale is 4% or sales tax rate for sale within the State whichever is lower,
if sale is to registered dealer and the goods are covered in the registration
certificate of the purchasing dealer. Otherwise the tax is higher - (10% or tax
leviable on sale of goods inside the State, whichever is higher). If the selling
dealer pays CST @ 4% or lower (if applicable), he has to produce proof to his
sales tax assessing authority that the purchasing dealer is eligible to get these
goods at concessional rate. Otherwise, the selling dealer will be asked to pay
balance tax payable plus penalty as applicable. Section 8(4)(a), therefore,
provides that concessional rate is applicable only if purchasing dealer submits
a declaration in prescribed form ‘C’.
AUTHORITY TO ISSUE BLANK C FORM - The blank C form has to be
obtained by purchasing dealer from Sales Tax authority in the State in which
goods are delivered, which is usually the place where purchasing dealer is
registered. However, in case on Inter State sale by transfer of documents, the
purchasing dealer may not be registered with the sales tax authorities in the
State where the goods are delivered. In such case, he can obtain blank C
form from sales tax authority where he is registered.
C Form is mandatory to avail concessional rate - Submission of C form is
mandatory and unless C form is submitted, concessional rate of sales tax will
not apply. It has been held that this procedure is designed to prevent fraud
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49. Management Accounting Indirect Tax
and collusion, and facilitate administrative efficiency. Hence it is mandatory.
Concession can be denied if the form is not submitted - Kedarnath Jute Mfg
Co. v. CTO - (1965) 3 SCR 626 = (1965) 16 STC 607 (SC) = AIR 1966 SC 12.
STATE GOVERNMENT CANNOT WAIVE THE CONDITION OF C/D FORM -
Section 8(5) has been amended w.e.f. 11th May 2002 to provide that State
Government can issue an exemption subject to fulfillment of requirements of
section 8(4). This sub-section requires declaration form registered
dealer/Government. Thus, State Government cannot waive condition of C/D
form.
Number of Transactions per ‘C’ certificate - One declaration in C form can
cover all transactions in one whole financial year, irrespective of total
amount/value of transactions during the year. [rule 12 amended w.e.f. 7-8-
1998].
ONE CERTIFICATE FOR EACH FINANCIAL YEAR - If a transaction covers
more than one financial year, separate C form is required for each financial
year. Provision of one 'C' form per financial year has been upheld in Laxmi
Agarbatti Factory v. UOI (1996) 102 STC 248 (MP HC DB).
Procedure in case of Loss of C form - If duly completed or blank C form is lost
when it was in custody of purchasing dealer or when the form was in transit to
selling dealer, the purchasing dealer will have to furnish ‘Indemnity Bond’ to
sales tax authority (from whom the blank forms were obtained) in prescribed
‘G’ form. If the duly completed C form is lost after it is received by selling
dealer, he has to submit indemnity bond to sales tax authority of his State.
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