The Tamil Nadu Goods and Services Tax (Amendment) Act, 2018
The following Act of the Tamil Nadu Legislative Assembly received the assent of the Governor on the 14th January 2019 and is hereby published for general information:-
ACT No. 3 OF 2019.
An Act to amend the Tamil Nadu Goods and Services Tax Act, 2017.
Be it enacted by the Legislative Assembly of the State of Tamil Nadu in the Sixty-ninth Year of the Republic of India as follows:-
1. Short title and commencement.
(1) This Act may be called the Tamil Nadu Goods and Services Tax (Amendment) Act, 2019.
(2) (i) Sections 3 and 30 shall be deemed to have come into force on the 1st day of July 2017;
(ii) Other sections of this Act shall come into force on such date as the State Government may, by notification in the Official Gazette, appoint:
Provided that different dates may be appointed for different provisions of this Act and any reference in any such provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision.
2. Amendment of section 2.
In section 2 of the Tamil Nadu Goods and Services Tax Act, 2017 (Tamil Nadu Act 19 of 2017.) (hereinafter referred to as the principal Act),-
(1) in clause (4), for the expression "the Appellate Authority and the Appellate Tribunal", the expression "the Appellate Authority, the Appellate Tribunal and the Authority referred to in sub-section (2) of section 171" shall be substituted;
(2) in clause (16), for the expression "Central Board of Excise and Customs", the expression "Central Board of Indirect Taxes and Customs" shall be substituted;
(3) in clause (17), for sub-clause (h), the following sub-clause shall be substituted, namely:-
"(h) activities of a race club including by way of totalisator or a license to book maker or activities of a licensed book maker in such club; and";
(4) clause (18) including the Explanation thereunder shall be omitted;
(5) in clause (35), for the expression "clause (c)", the expression "clause (b)" shall be substituted;
(6) in clause (69), in sub-clause (f), after the expression "Article 371", the expression "and Article 371J" shall be inserted;
(7) in clause (102), the following Explanation shall be added, namely:-
"Explanation.- For the removal of doubts, it is hereby clarified that the expression "services" includes facilitating or arranging transactions in securities.".
3. Amendment of section 7.
In section 7 of the principal Act,-
(1) in sub-section (1),-
(a) in clause (b), after the expression "or furtherance of business;", the expression "and" shall be added;
(b) in clause (c), the expression "and" occurring after the expression "without a consideration;", shall be omitted;
(c) clause (d) shall be omitted;
(2) after sub-section (1), the following sub-section shall be inserted, namely:
"(1A) Where certain activities or transactions, constitute a supply in accordance with the provisions of sub-section (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule II.";
(3) in sub-section (3), for the expression "sub-sections (1) and (2)", the expression "sub-sections (1), (1A) and (2)" shall be substituted.
4. Amendment of section 9.
In section 9 of the principal Act, for sub-section (4), the following sub-section shall be substituted, namely:-
"(4) The Government may, on the recommendations of the Council, by notification, specify a class of registered persons who shall, in respect of supply of specified categories of goods or services or both received from an unregistered supplier, pay the tax on reverse charge basis as the recipient of such supply of goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to such supply of goods or services or both.".
5. Amendment of section 10.
In section 10 of the principal Act,-
(a) for the expression "in lieu of the tax payable by him, an amount calculated at such rate", the expression "in lieu of the tax payable by him under sub-section (1) of section 9, an amount of tax calculated at such rate" shall be substituted;
(b) in the proviso, for the expression "one crore rupees, as may be recommended by the Council.", the expression "one crore and fifty lakh rupees as may be recommended by the Council:" shall be substituted;
(c) after the proviso, the following proviso shall be added, namely:-
"Provided further that a person who opts to pay tax under clause (a) or clause (b) or clause (c) may supply services (other than those referred to in clause (b) of paragraph 6 of Schedule II), of value not exceeding ten per cent of turnover in the State in the preceding financial year or five lakh rupees, whichever is higher.";
(2) in sub-section (2), for clause (a), the following clause shall be substituted, namely:-
"(a) save as provided in sub-section (1), he is not engaged in the supply of services;".
6. Amendment of section 12.
In section 12 of the principal Act, in sub-section (2), in clause (a), the expression "sub-section (1) of " shall be omitted.
7. Amendment of section 13.
In section 13 of the principal Act, in sub-section (2), the expression "sub-section (2) of " in two places where it occurs, shall be omitted.
8. Amendment of section 16.
In section 16 of the principal Act, in sub-section (2),-
(1) in clause (b), for the Explanation, the following Explanation shall be substituted, namely:-
"Explanation.- For the purposes of this clause, it shall be deemed that the registered person has received the goods or, as the case may be, services-
(i) where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise;
(ii) where the services are provided by the supplier to any person on the direction of and on account of such registered person.";
(2) Omitted By Amendemnt Act 2023.
9. Amendment of section 17.
In section 17 of the principal Act,-
(1) in sub-section (3), the following Explanation shall be added, namely:-
"Explanation.- For the purposes of this sub-section, the expression "value of exempt supply'' shall not include the value of activities or transactions specified in Schedule III, except those specified in paragraph 5 of the said Schedule.";
(2) in sub-section (5), for clauses (a) and (b), the following clauses shall be substituted, namely:-
"(a) motor vehicles for transportation of persons having approved seating capacity of not more than thirteen persons (including the driver), except when they are used for making the following taxable supplies, namely:-
(A) further supply of such motor vehicles; or
(B) transportation of passengers; or
(C) imparting training on driving such motor vehicles;
(aa) vessels and aircraft except when they are used,-
(i) for making the following taxable supplies, namely:-
(A) further supply of such vessels or aircraft; or
(C) imparting training on navigating such vessels; or
(D) imparting training on flying such aircraft;
(ii) for transportation of goods;
(ab) services of general insurance, servicing, repair and maintenance in so far as they relate to motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa):
Provided that the input tax credit in respect of such services shall be available,-
(i) where the motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) are used for the purposes specified therein;
(ii) where received by a taxable person engaged,-
(I) in the manufacture of such motor vehicles, vessels or aircraft; or
(II) in the supply of general insurance services in respect of such motor vehicles, vessels or aircraft insured by him;
(b) the following supply of goods or services or both,-
(i) food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, leasing, renting or hiring of motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) except when used for the purposes specified therein, life insurance and health insurance:
Provided that the input tax credit in respect of such goods or services or both shall be available where an inward supply of such goods or services or both is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply;
(ii) membership of a club, health and fitness centre; and
(iii) travel benefits extended to employees on vacation such as leave or home travel concession:
Provided that the input tax credit in respect of such goods or services or both shall be available, where it is obligatory for an employer to provide the same to its employees under any law for the time being in force.".
10. Amendment of section 20.
In section 20 of the principal Act, in the Explanation, in clause (c), for the expression "under entry 84", the expression "under entries 84 and 92A" shall be substituted.
11. Amendment of section 22.
In section 22 of the principal Act,-
(1) in sub-section (1), after the proviso, the following proviso shall be added, namely:-
"Provided further that where such person makes taxable supplies of goods or services or both from a special category State in respect of which the Central Government has enhanced the aggregate turnover referred to in the first proviso, he shall be liable to be registered if his aggregate turnover in a financial year exceeds the amount equivalent to such enhanced turnover.";
(2) in the Explanation, in clause (iii), the following shall be added at the end, namely:-
"except the State of Jammu and Kashmir and the States of Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand.".
12. Amendment of section 24.
In section 24 of the principal Act, lor clause (x), the following clause shall be substituted, namely:-
"(x) every electronic commerce operator who is required to collect tax at source under section 52.".
13. Amendment of section 25.
In section 25 of the principal Act,-
(1) in sub-section (1), after the proviso and before the Explanation, the following proviso shall be inserted, namely:-
"Provided further that a person having a unit, as defined in the Special Economic Zones Act, 2005 (Central Act 28 of 2005), in a Special Economic Zone or being a Special Economic Zone developer shall have to apply for a separate registration, as distinct from his place of business located outside the Special Economic Zone in the same State.";
(2) in sub-section (2), for the proviso, the following proviso shall be substituted, namely:-
"Provided that a person having multiple places of business in the State may be granted a separate registration for each such place of business, subject to such conditions as may be prescribed.".
14. Amendment of section 29.
In Section 29 of the principal Act,-
(1) in the marginal heading, after the expression "Cancellation", the expression "or suspension" shall be inserted;
(2) in sub-section (1), after clause (c), the following proviso shall be added, namely:-
"Provided that during pendency of the proceedings relating to cancellation of registration filed by the registered person, the registration may be suspended for such period and in such manner as may be prescribed.";
(3) in sub-section (2), after the proviso, the following proviso shall be added, namely:-
"Provided further that during pendency of the proceedings relating to cancellation of registration, the proper officer may suspend the registration for such period and in such manner as may be prescribed.".
15. Amendment of section 34.
In section 34 of the principal Act,-
(i) for the expression "Where a tax invoice has", the expression "Where one or more tax invoices have" shall be substituted;
(ii) for the expression "a credit note", the expression "one or more credit notes for supplies made in a financial year" shall be substituted;
(2) in sub-section (3),-
(ii) for the expression "a debit note", the expression "one or more debit notes for supplies made in a financial year" shall be substituted.
16. Amendment of section 35.
In section 35 of the principal Act, in sub-section (5), the following proviso shall be added, namely:-
"Provided that nothing contained in this sub-section shall apply to any department of the Central Government or a State Government or a local authority, whose books of account are subject to audit by the Comptroller and Auditor-General of India or an auditor appointed for auditing the accounts of local authorities under any law for the time being in force.".
17. Amendment of section 39.
In section 39 of the principal Act,-
(a) for the expression "in such form and manner as may be prescribed", the expression "in such form, manner and within such time as may be prescribed" shall be substituted;
(b) the expression "on or before the twentieth day of the month succeeding such calendar month or part thereof" shall be omitted;
(c) the following proviso shall be added, namely:-
"Provided that the Government may, on the recommendations of the Council, notify certain classes of registered persons who shall furnish return for every quarter or part thereof, subject to such conditions and safeguards as may be specified therein.";
(2) in sub-section (7), the following proviso shall be added, namely:-
"Provided that the Government may, on the recommendations of the Council, notify certain classes of registered persons who shall pay to the Government the tax due or part thereof as per the return on or before the last date on which he is required to furnish such return, subject to such conditions and safeguards as may be specified therein.";
(3) in sub-section (9),-
(a) for the expression "in the return to be furnished for the month or quarter during which such omission or incorrect particulars are noticed", the expression "in such form and manner as may be prescribed" shall be substituted;
(b) in the proviso, for the expression "the end of the financial year", the expression "the end of the financial year to which such details pertain" shall be substituted.
18. Insertion of new section 43A.
Omitted By Amendemnt Act 2023
19. Amendment of section 48.
In section 48 of the principal Act, in sub-section (2), after the expression "section 45", the expression "and to perform such other functions" shall be inserted.
20. Amendment of section 49.
In section 49 of the principal Act,-
(1) Omitted By Amendemnt Act 2023;
(2) in sub-section (5),-
(a) in clause (c), the following proviso shall be added, namely:-
"Provided that the input tax credit on account of State tax shall be utilised towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax.";
(b) in clause (d), the following proviso shall be added, namely:-
"Provided that the input tax credit on account of Union territory tax shall be utilised towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax.".
21. Insertion of new sections 49A and 49B.
After section 49 of the principal Act, the following sections shall be inserted, namely:-
"49A. Utilisation of input tax credit subject to certain conditions.-
Notwithstanding anything contained in section 49, the input tax credit on account of State tax shall be utilised towards payment of integrated tax or State tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilised fully towards such payment.
49B. Order of utilisation of the input tax credit.
Notwithstanding anything contained in this Chapter and subject to the provisions of clause (e) and clause (f) of sub-section (5) of section 49, the Government may, on the recommendations of the Council, prescribe the order and manner of utilisation of the input tax credit on account of integrated tax, Central tax, State tax or Union territory tax, as the case may be, towards payment of any such tax.".
22. Amendment of section 52.
In section 52 of the principal Act, in sub-section (9), for the expression "section 37", the expression "section 37 or section 39" shall be substituted.
23. Amendment of section 54.
In section 54 of the principal Act,-
(1) in sub-section (8), in clause (a),-
(a) for the expression "on zero-rated supplies", the expression "on export" shall be substituted;
(b) for the expression "such zero-rated supplies", the expression "such exports" shall be substituted;
(2) in the Explanation, in clause (2),-
(a) in sub-clause (c), in item (i), after the expression "foreign exchange", the expression "or in Indian rupees wherever permitted by the Reserve Bank of India" shall be inserted;
(b) for sub-clause (e), the following sub-clause shall be substituted, namely:-
"(e) in the case of refund of unutilised input tax credit under clause (ii) of the first proviso to sub-section (3), the due date for furnishing of return under section 39 for the period in which such claim for refund arises;".
24. Amendment of section 79.
In section 79 of the principal Act, after sub-section (4), the following Explanation shall be added, namely:-
"Explanation.- For the purposes of this section, the word person shall include "distinct persons" as referred to in sub-section (4) or, as the case may be, sub-section (5) of section 25.".
25. Amendment of section 107.
In section 107 of the principal Act, in sub-section (6), in clause (b), after the expression "arising from the said order,", the expression "subject to a maximum of twenty-five crore rupees," shall be inserted.
26. Amendment of section 112.
In section 112 of the principal Act, in sub-section (8), in clause (b), after the expression "arising from the said order," the expression "subject to a maximum of fifty crore rupees," shall be inserted.
27. Amendment of section 129.
In section 129 of the principal Act, in sub-section (6), including the proviso, for the expression "seven days", in two places where it occurs, the expression "fourteen days" shall be substituted.
28. Amendment of section 143.
In section 143 of the principal Act, in sub-section (1), in clause (b), after the proviso, the following proviso shall be added, namely:-
"Provided further that the period of one year and three years may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding one year and two years, respectively.".
29. Amendment of Schedule I.
In Schedule I of the principal Act, in paragraph 4, for the expression "taxable person", the expression "person" shall be substituted.
30. Amendment of Schedule II.
In Schedule II of the principal Act, in the heading, after the expression "ACTIVITIES", the expression "OR TRANSACTIONS" shall be inserted.
31. Amendment of Schedule III.
In Schedule III of the principal Act,-
(1) after paragraph 6, the following paragraphs shall be inserted, namely:-
"7. Supply of goods from a place outside India to another place outside India without such goods entering into India.
8. (a) Supply of warehoused goods to any person before clearance for home consumption;
(b) Supply of goods by the consignee to any other person, by endorsement of documents of title to the goods, after the goods have been dispatched from the port of origin located outside India but before clearance for home consumption.";
(2) The existing Explanation shall be numbered as Explanation 1 and after Explanation 1 as so numbered, the following Explanation shall be added, namely:-
"Explanation 2.- For the purposes of paragraph 8, the expression "warehoused goods" shall have the same meaning as assigned to it in the Customs Act, 1962 (Central Act 52 of 1962).".
32. Repeal and saving.
(1) The Tamil Nadu Goods and Services Tax (Amendment) Ordinance, 2018 (Ordinance 2 of 2018.) is Tamil Nadu hereby repealed.
(2) Notwithstanding such repeal, anything done or any action taken under the Tamil Nadu Act Tamil Nadu Goods and Services Tax Act, 2017, as amended by the said Ordinance, shall be 19 of 2017. deemed to have been done or taken under the said Act, as amended by this Act.
(By order of the Governor)
S.S. POOVALINGAM,
Secretary to Government, Law Department.