The following Act of the Kerala State Legislature is hereby published for general information. The Bill as passed by the Legislative Assembly received the assent of the Governor on the 19th day of July, 2019.

By order of the Governor,

ARAVINTHA BABU. P. K.

Law Secretary.

Act No. 5 of 2019

EXTRACT OF THE KERALAFINANCE ACT, 2019

An Act to give effect to certain financial proposals of the Government of Kerala for the Financial Year 2019-2020.

Preamble.-Whereas, it is expedient to give effect to certain financial proposals of the Government of Kerala for the Financial Year 2019-2020;

Be it enacted in the Seventieth Year of the Republic of India as follows:-

1. Short title and commencement-

(1) This Act may be called the Kerala Finance Act, 2019.

(2) Save as otherwise provided in this Act, it shall be deemed to have come into force on the 1st day of April, 2019.

2. Amendment of Act 11 of 1957.-

In the Kerala Surcharge on Taxes Act, 1957 (11 of 1957), for section 3A, the following section shall be substituted, namely:-

"3A. Reduction of arrears in certain cases,-

(1) Notwithstanding anything contained in this Act or rules made thereunder or in any judgment, decree or order of any court, tribunal or appellate authority, any assessee who is in arrears of surcharge or any other amount due under this Act relating to the period up to and including 30th June, 2017, may opt for settling the arrears on payment of the principal amount of the tax in arrears by availing a complete reduction of the penalty amount, interest on the tax amount and on the penalty amount.

(2) Notwithstanding anything contained in the Kerala Revenue Recovery Act, 1968, (15 of 1968) reduction of arrears under sub-section (1) shall be applicable to those cases in which revenue recovery proceedings have been initiated and the assessing authorities shall have the power to collect such amounts on settlement under sub-section (1) and where the amount is settled under sub-section (1), the assessing authorities shall withdraw the revenue recovery proceedings against such assessees which will then be binding on the revenue authorities and such assessees shall not be liable for payment of any collection charges.

(3) The assessee shall withdraw all the cases pending before any appellate or revisional authority, tribunal or courts for opting for settling the arrears under this section.

(4) All arrears including tax and penalties pertaining to a year shall be -settled together under this section.

(5) An assessee who intends to opt for payment of arrears under subsection (1), shall submit an option to the assessing authority on or before 30th September, 2019:

Provided that with respect to demands generated after 30th September, 2019, the option may be filed within 30 days from the date of the receipt of the order and in such cases the final payment of tax and other amounts due as per this section shall be completed on or before 31st March, 2020.

(6) The arrears for the purpose of settlement under this section shall be calculated as on the date of submission of option.

(7) On receipt of the option under sub-section (5), the assessing authority shall determine the amount of tax and other amounts due from the dealer under sub-section (1), and shall intimate the same to the dealer, and thereupon the dealer shall remit the amount in a maximum of six instalments on or before 31st March, 2020.

(8) Notwithstanding anything contained in this Act, if an assessee who opts to settle his arrears under sub-section (1) has remitted or deposited any amount relating to the arrears after the service of demand notice, such amounts shall be given credit as tax under this option and the assessee shall furnish the proof of payments made in this regard;

Provided that, any amount paid towards penalty or its interest shall not be credited towards tax.

(9) There shall not be any refund or any adjustment subsequently for the amount settled under this scheme, under any circumstances."

7. Amendment of Act 20 of 1961.- In the Kerala General Sales Tax Act, 1963 (15 of 1963),-

(1) in section 5, in sub-section (2), after sub-clause (ii), the following proviso shall be inserted, namely:-

"Provided that no turnover tax shall be leviable on the turnover of foreign liquor transferred or disposed by a dealer in foreign liquor as per the orders of the Excise Department pursuant to the Abkari policy of the Government forte year 2014-2015.";

(2) in section 7, the following proviso shall be inserted, namely:-

"Provided that the calculation under sub-clause (b) of clause (ii) shall not be applicable in case of bar attached hotels whose FL-3 licences issued under the Abkari Act, 1077 (1 of 1077) was cancelled and was converted to FL-11 licences in pursuance of the Abkari Policy of the Government for the year 2014-2015 and such FL-11 licencees had conducted business under such licence for a full financial year.";

(3) for section 23B, the following section shall be substituted, namely:-

23B, Reduction of arrears in certain cases.-

(1) Notwithstanding anything contained in this Act or rules made thereunder or in any judgment, decree or order of any court, tribunal or appellate authority, any assessee, who is in arrears of tax or any other amount due under this Act or under the Central Sales Tax Act, 1956 (Central Act 74 of 1956),-

(i) in case of demands relating to the period upto and including 31st March, 2005, may opt for settling the arrears on payment of the principal amount of the tax in arrears by availing a complete reduction of the penalty amount, interest on the tax amount and on the penalty amount; and

(ii) in case of demands relating to the period from 1st April, 2005 to 31st March, 2018, may opt for settling the arrears on payment of the principal amount of the tax and interest in arrears by availing a complete reduction of the penalty amount:

Provided that in case where the evidence, details and records pertaining to the penalty levied is not utilized or not liable to be utilized for any best judgment assessment under this Act, the demand relating to such penalty shall be settled under this section on payment of applicable tax relating to the penalty as determined by the assessing authority.

(2) Notwithstanding anything contained in the Kerala Revenue Recovery Act, 1968, (15 of 1968) reduction of arrears under sub-section (1) shall be applicable to those cases in which revenue recovery proceedings have been initiated and the assessing authorities shall have the power to collect such amounts on settlement under sub-section (1) and where the amount is settled under sub-section (1) the assessing authorities shall withdraw the revenue recovery proceedings against such assessees which will then be binding on the revenue authorities and such assessees shall not be liable for payment of any collection charges.

(3) The assessee shall withdraw all the cases pending before any appellate or revisional authority, tribunal or courts for opting for settling the arrears under this section.

(4) All arrears including tax and penalties pertaining to a year shall be settled together under this section.

(5) An assessee who intends to opt for payment of arrears under sub-section (1) shall submit an option to the assessing authority on or before 30th September, 2019;

Provided that with respect to demands generated after 30th September, 2019, the option may be filed within 30 days from the date of receipt of the order and in such cases the final payment of tax and other amount due as per this section shall be completed before 31st March, 2020.

(6) The arrears for the purpose of settlement under this section shall be calculated as on the date of submission of option.

(7) On receipt of the option under sub-section (5), the assessing authority shall determine the amount of tax and other amounts due from the dealer under sub-section (1) and shall intimate the same to the dealer, and thereupon the dealer shall remit the amount in a maximum of six instalments on or before 31st March, 2020.

(8) Notwithstanding anything contained in section 55C, if an assessee who opts to settle his arrears under sub-section (1) has remitted or deposited any amount relating to the arrears after the service of demand notice, such amounts shall be given credit as tax under this option and the assessee shall furnish the proof of payments made in this regard:

Provided that, any amount paid towards penalty or its interest shall not be credited towards tax.

(9) There shall not be any refund or any adjustment subsequently for the amount setded under this scheme, under any circumstances,".

(4) in THE SCHEDULE, in serial number 2, under the heading 'Foreign Liquor', for the entries "25, 78,100, 70, 210, 200" against sub-entries (i), (ii), (iii), (iv) and sub-items (a) and (b) of sub-entry (v), the sub-entries "27, 80, 102, 72, 212, 202" shall, respectively, be substituted.".