CHHATTISGARH VALUE ADDED SALES TAX (AMENDMENT) ACT, 2005 (No.2. of 2006)

An Act to amend Chhattisgarh Value Added Sales Tax Act, 2005 (No. 2 of 2005)

Be it enacted by the Chhattisgarh Legislature in the fifty sixth year of the Republic of India as follows:

1. Short title and Commencement.

(1) This Act may be called the Chhattisgarh Value Added Sales Tax (Amendment) Act, 2005 (No. of 2005).

(2) It shall come in to force on such date as the State Government may, by notification appoint.

2. Amendment of the title of the Act.

In the title of the Chhattisgarh Value Added Sales Tax Act, 2005 (No. 2 of 2005) the word "Sales" shall be omitted.

3. Amendment of Section 1

In sub-section (1) of section 1 of the Chhattisgarh Value Added Sales Tax Act, 2005 (No. 2 . Of 2005) (here in after referred as Principal Act), the word "Sales" shall be omitted.

4. Amendment of Section 2.

In section 2 of the Principal Act,

(1) Clause (c) shall be omitted.

(2) For clause (e) the following shall be substituted, namely:

"(e) "Capital goods" means plants, machinery and equipments directly used in the process of manufacture and / or in the course of business excluding such equipments as may be notified."

(3) After clause (e) the following clause shall be inserted, namely:

"(e-a) "Commercial Tax Officer" means a Commercial Tax Officer appointed under section 3 and includes an Additional Commercial Tax Officer.

(e-b) Cooked food includes sweets and sweetmeats, namkeen, mishri, batasha, chironji, shrikhand, rabadi, doodhpak, prepared tea and prepared coffee but excludes ice-cream, kulfi, ice-candy, non-alcoholic drink containing ice-cream, cakes, pastries, biscuits, chocolates, toffees, lozenges, peppermint drops and mawa."

(4) In clause (t) after Explanation (ii) the following shall be inserted, namely:

"(iii) The amount of valuable consideration paid or payable to a dealer for the sale of Drugs and Medicines specified in entry 42 in part II of Schedule II shall be the maximum retail price printed on the package containing the Drugs and Medicines, for the purposes of levy of tax under section 8."

(5) Clause (u) shall be omitted.

(6) (i) Paragraph (iii) of sub clause (3) of clause (w) shall be omitted.

(ii) In proviso (a) of clause (w) the words and figures "or paragraph (iii) of (3)" and "of clause (ii)" of shall be omitted.

(iii) In proviso (b) of clause (w) the words and figures "or clause (ii)" and "or paragraph (iii) of sub clause (3)" shall be omitted.

(7) In clause (z) the word "sales" shall be omitted.

5. Amendment of 2, 3, 25, 43, 58, 60 and 63

Wherever the words "sales tax" occur in section section 2, 3, 25, 43, 58, 60 and 63 of the Principal Act, the words "commercial tax" shall be substituted.

6. Insertion of section 3A.

After section 3 of the Principal Act, the following section shall be inserted, namely:

"3A. Tribunal

(1) Subject to such rules as may be made in this behalf, the State Government may, by notification, with effect from a date specified therein, constitute Tribunal to exercise the powers and perform the functions conferred on the Tribunal by or under the Act.

(2) Till the date specified in the notification under sub-section (1), the Board of Revenue, Chhattisgarh shall act as Tribunal for the purpose of this Act and on the date aforementioned all proceedings pending before the Board of Revenue, Chhattisgarh, acting as Tribunal shall stand transferred to the Tribunal constituted under sub-section (1).

(3) Subject to the previous approval of the State Government, the Tribunal may, from time to time, make regulations not inconsistent with the provisions of this Act regulating the procedure and disposal of its business."

7. Amendment of Section 4.

In sub section (i) of section 4 of the Principal Act, the words "which shall not exceed rupees 5 Lacs" shall be omitted.

8. Amendment of Section 8.

In section 8 of the Principal Act,

(1) In clause (i) for the words and figures "part I, II, IV and V" the words and figures "parts I, II and IV" shall be substituted.

(2) In clause (ii) the figures "IV" shall be omitted.

9. Amendment of section 9.

In section 9 of the Principal Act,

(1) In clause (a) of sub section (1) after the words "under section 15" the following shall be inserted, namely:

"and section 15(b) which are disposed off otherwise than by way of sale in the course of export out of the territory of India."

(2) For sub clause (ii) of clause (c) of sub section (1) the following shall be substituted, namely:

"(ii) the manufactured goods are sold in the State of Chhattisgarh or in the course of inter-state trade or commerce or in the course of export out of the territory of India;

and such tax shall be levied,

(a) in respect of goods referred to in clause (a) and clause (b) at the rate specified in column (3) and (4) of schedule II; and

(b) in respect of goods referred to in sub clause (i) of clause (c) at the rate of 4% on the goods specified in part II, part III and part IV of schedule II; and

(c) in respect of goods referred to in sub-clause (ii) of clause (c) at the rate specified in column (4) of the said schedule, at the rate at which tax would have been levied on the sales of such goods within the State on the date of such purchase."

10. Amendment of section 10.

In section 10 of the Principal Act,

(1) In clause (a) of sub-section (2) after the words "and/or purchasing goods specified in schedule I" the words "and/or a registered dealer who manufactures cooked food" shall be inserted and for the word "fifteen" the word "fifty" shall be substituted.

(2) In clause (b) of sub-section (2) the words "clause (a) of this section" shall be omitted.

(3) Clause (c) of sub-section (2) shall be omitted.

11. Amendment of section 13.

In section 13 of the Principal Act,

(1) Clause (a) of sub-section (1) after words "(a)" the figure "(i)" shall be inserted.

(2) In clause (a) of sub-section (1), for the words and figures starting from "after payment to him, of the tax under clause (i) of section 8, he shall claim or be allowed in such manner and within such period as may be prescribed, input tax rebate of the amount of such tax" the words and figures "or for sale out side the state by way of stock transfer after payment to him of the tax under clause (i) of section 8, he shall claim or be allowed input tax rebate of such amount of tax, in such manner and within such period as may be prescribed." shall be substituted.

(3) After clause (a) of sub-section (1) the following shall be added, namely:

"(ii) When a registered dealer purchases any goods specified in schedule II other than those specified in Schedule III within state of Chhattisgarh from another such dealer after payment to him of the tax under clause (i) of section 8, for use as capital goods in the course of business within the state of Chhattisgarh, he shall claim or be allowed input tax rebate of such amount of tax, in such manner and within such period as may be prescribed."

(4) In clause (b) of sub-section (1) for the words and figures "and any goods specified in schedule I or schedule II for sale in the course of export out of the territory of India, he shall claim or be allowed, in such manner and within such period, input tax rebate of the amount of such tax", the words and figures "or for sale out side the state by way of stock transfer and any goods specified in schedule I or schedule II for sale in the course of export out of the territory of India, he shall claim or be allowed input tax rebate of such amount of tax in such manner and within such period as may be prescribed." shall be substituted.

(5) In clause (c) of sub-section (1) for the word (c) the word (b) shall be substituted.

(6) After sub-section (3) the following proviso shall be inserted, namely:

"Provided that, if the amount of input tax rebate, which remains un adjusted even after two years, it shall be granted to him by way of refund."

(7) In sub clauses (i) and (ii) of clause (a) of sub-section (5) after the words "interstate trade or commerce" the words, "or by way of sale outside the state, by way of stock transfer." shall be added.

(8) In sub-section (6) after clause (iii) the following clause shall be inserted, namely:

"(iv) in respect of any goods specified in schedule II for which the amount of tax is not shown separately in the sale Act, invoice or cash memoranda."

12. Amendment of section 15.

(1) In section 15 of the Principal Act, the existing section shall be numbered as sub-section (2) In section (15) the following sub-section shall be added:

"(2) The State Government may in respect of any goods, by notification amend Schedule-I, so as to include therein any goods not already specified or may relax or omit any of the conditions and exceptions set out in the corresponding entry in the third column thereof."

13. Insertion of new sections.

After section 15 of the Principal Act, the following section shall be inserted, namely:

"15A. Power of State Government to amend Schedule II

(1) The State Government may, by notification, amend the Schedule II and thereupon the said Schedule shall stand amended accordingly:

Provided that the rate of tax in respect of any goods specified therein other than the declared goods shall not exceed the rate of tax prescribed in the next higher slab of the rate of tax specified in the Schedule.

Provided further that if any goods are transposed by deleting them from one of the parts of the Schedule and inserting or adding them to another, the rate of tax in respect of such goods shall not exceed the rate of tax prescribed in the next higher slab of the rate of tax specified in the Schedule.

(2) No notification enhancing the rate of tax, shall be issued under this Section without giving in the Gazette such previous notice as the State Government may consider reasonable of its intention to issue such notification;

(3) Every notification issued under sub-section (1) shall, as soon as may be, be laid on the table of the Legislative Assembly.

15B saving-

(1) The State Government may, by notification and subject to such restrictions and conditions as may be specified therein, exempt whether prospectively or retrospectively,

(i) (a) any class of dealers; or

(b) any goods or class of goods, in whole or in part, from the payment of tax under this Act for such period as may be specified in the notifications;

(ii) any dealer or class of dealers from any provision of this Act or any provision of a rule made under section 71 for such period as may be specified in the notification.

(2) Any notification issued under this section may be rescinded before the expiry of the period for which it was to have remained in force and on such rescission such notification shall cease to be in force. A notification rescinding an earlier notification shall have prospective effect.

(3) Notwithstanding the repeal of the Chhattisgarh Commercial Tax Act, 1994 (C.G. Act No. 5 of 1995) (hereinafter referred to as the repealed Act) the State Government may, by notification exempt

(i) (a) any class of dealers; or

(b) any goods or class of goods in whole or in part,from the payment of tax under the repealed Act; or

(ii) any dealer or class of dealers from any provision of the repealed Act or the provision of any rule made there under,

for any period before the commencement of this Act and for that purpose it shall and shall always be deemed that the provision of Section 17 of the repealed Act have been revived for the purpose of such exemption."

14. Amendment of section 16.

For section 16 of the Principal Act, the following shall be substituted, namely:

"16: (1) Every dealer whose turnover during the twelve months immediately preceding the commencement of this Act exceeds the limits specified in sub-section (1) of section 4 shall get himself registered in the prescribed manner within thirty days of the commencement of the Act.

(2)(a) Every dealer other than a dealer to whom sub-section (1) applies shall get himself registered within the prescribed period from the date on which his turnover in a year first exceeds the limits prescribed under sub-section (1) of section 4.

(b) Every dealer being a transferee of a business within the meaning of subsection (1) of section 30 shall get himself registered within thirty days from the date of transfer of the business of which he is a transferee.

(c) A dealer who though not liable to pay tax under section 4 desires to obtain a registration certificate voluntarily may get himself registered under this Act.

(d) Any person intending to establish a business in the State for the manufacture of goods for sale of value exceeding rupees two lac in a year and who is registered in the Industries Department of State Government for establishing an industrial unit in the State or who is issued a licence wherever necessary or has sent a memorandum of information to the Central Government to establish a new industrial undertaking in the State under the provisions of the Industries (Development and Registration) Act, 1951 (No. 65 of 1951), may, notwithstanding that he is not liable for registration under clause (a), get himself registered under this Act.

(3) Every dealer required to get himself registered under sub-section (1) or clause (a) or clause (b) of sub-section (2), or a dealer who desires to get himself registered under clause (c) of sub section (2), or a person who desires to get himself registered under clause (d) of sub-section (2) shall make an application supported with an affidavit to the commissioner in such form and such manner as may be prescribed, giving correct and complete particulars therein.

(4) (a) On the day the application for grant of a registration certificate as required by sub-section (1) or sub-section (2) is received, the said authority shall grant the applicant a registration certificate in the prescribed form.

(b) After issue of the registration certificate on application referred to in clause (a), the commissioner shall verify the particulars given in the application in such manner as may be prescribed.

(c) If the commissioner on verification under clause (b) is satisfied that the particulars given by the applicant in his application are incorrect or that the applicant has misrepresented certain facts, he shall, after giving the applicant an opportunity of being heard and recording the reasons in writing, cancel the registration certificate issued to the applicant under clause (a) in accordance with the provisions of clause (c) or clause (e) of sub section (10) from the date of its issue, not later than thirty days of the date of receipt of the application.

(5) The registration certificate granted under sub-section (4) shall take effect from

(a) in a case where a dealer required to get himself registered under clause (a) or clause (b) of sub-section (2) has applied for registration within the period prescribed under clause (a) or specified in clause (b) of the said sub-section, the date on which his turnover in a year first exceeds the limits prescribed under sub-section (1) of section 4 or the date of transfer of business as the case may be;

(b) in a case where a dealer required to get himself registered under clause (a) or clause (b) of sub-section (2) has applied for registration after the expiry of the prescribed or specified period, as the case may be, the date on which he applies for registration;

(c) where a dealer has applied under clause (c) or a person has applied under clause (d) of sub section (2) for registration, the date of such application and notwithstanding the provisions of section 4, such dealer or person as the case may be, shall be liable to pay tax under the Act, during the period from the said date of application till his registration certificate remains in force.

(6) Without prejudice to the provisions of sub-section (6) of section 21, when a dealer has without reasonable cause, failed to get himself registered within the prescribed time as required by sub-section (1) or clause (a) or clause (b) of subsection (2) the commissioner may, after giving such dealer a reasonable opportunity of being heard, direct him to pay by way of penalty, a sum not exceeding rupees five hundred.

(7) Every dealer who at the commencement of this Act holds a registration certificate under the provisions of the Act repealed by this Act shall, on such commencement, be deemed, to be a dealer registered and holding a registration certificate under this section.

(8) If any registered dealer or other dealer who is required to furnish returns under sub-section (1) of section 19

(a) sells or otherwise disposes off his business or any part or place of his business or effects or comes to know of any other change in the ownership of the business, or

(b) discontinues his business or changes his place of business or opens a new place of business, or

(c) changes the name or nature of his business, he or if he dies, his legal representative shall within the prescribed time, inform the prescribed authority accordingly.

(9) (a) The commissioner shall,

(i) on application made by a registered dealer for amendment of his registration certificate in pursuance of the provisions of subsection (8) or otherwise, amend the registration certificate of the dealer or reject the application within 30 days of the date of receipt of such application, after making such enquiry as he deems fit; and

(ii) on being satisfied that the registration certificate issued to a dealer requires amendment with regard to certain particulars specified therein, amend the registration certificate after giving the dealer an opportunity of being heard.

(b) When the registration certificate is amended under sub-clause (i) of clause (a) in pursuance of any of the events specified in sub-section (8), such amendment shall take effect from the date such event has taken place and in all other cases falling under the said sub-clause the amendment shall take effect from the date of application. An amendment made under sub-clause (ii) of clause (a) shall take effect from the date of order for making such amendment.

(10) When,

(a) a registered dealer discontinues or transfers his business; or

(b) the liability of a registered dealer to pay tax ceases; or

(c) a registered dealer has been granted a registration certificate by mistake; or

(d) a registered dealer is in arrears of tax or penalty or any other sum due under this Act or under the Act repealed by this Act; or

(e) the commissioner for reasons to be recorded in writing, is of the opinion that the registration certificate should be cancelled for any other reason;

the commissioner may either on his own motion or on the application of the dealer in this behalf cancel the registration certificate but notwithstanding such cancellation the dealer shall be liable to pay tax for the period during which his registration certificate remained in force.

Provided that where the commissioner proposes to cancel the registration certificate under this sub-section, he shall give the dealer an opportunity of being heard.

(11) Any dealer whose registration certificate is cancelled under clause (d) or clause (e) of sub-section (10) shall, for the purpose of sub-section (6) of section 21 be deemed to be a dealer, who has failed to apply for registration, but shall not be liable to pay any penalty under the said sub-section."

15. Amendment of section 17.

Section 17 of the Principal Act shall be omitted.

16. Amendment of section 19.

In section 19 of the Principal Act,

(1) In sub-clause (iii) of clause (a) of sub-section (4), for the figures " 1.25 " the figures "1 " shall be substituted.

(2) After sub-section (4) the following sub-section shall be added namely:

"(5) (a) If the commissioner has reason to believe that the particulars given by a registered dealer in his return or returns furnished by him for any period under subsection (1) or sub-section (2) are not correct he may, by giving the dealer an opportunity of being heard, verify the correctness of such particulars in the return or returns.

(b) If on such verification it is found that the particulars given in the return or returns are not correct in so far as they relate to the application of the correct rate of tax, the calculation of tax or interest payable or claim of any deduction and input tax rebate, he shall by issue of a notice in the prescribed form require such dealer to make the payment of the additional amount of tax and or interest payable by him within the period specified in such notice."

17. Amendment of section 22, 24, 40, 47, 48, 49, 50, 54, 55, 56 and 71.

Wherever the word "Board" occurs in section 22, 24, 40, 47, 49, 48, 50, 54, 55, 56 and 71 of the Principal Act, the word "Tribunal" shall be substituted.

18. Amendment of section 22.

In clause (e) of sub-section (1) of section 22 of the Principal Act, after the words "from the date of order of assessment" the words "or from the date of judgment or order of any court or tribunal" shall be inserted.

19. Amendment of section 25.

In section 25 of the Principal Act,

(1) In sub-section (6) for the figures "1.25" the figures "1" shall be substituted.

(2) In sub-section (7) for the word "fifteen" the word "twelve" shall be substituted.

(3) In sub-section (8) for the figures "1.25" the figures "1" shall be substituted.

20. Amendment of section 28.

In section 28 of the Principal Act, after the words "no deduction" the words "or deduction at a lower rate" shall be inserted.

21. Amendment of section 39.

In sub-section (5) of section 39 of the Principal Act, for the word "one" the word "half" shall be substituted.

22. Amendment of section 42.

(1) In sub-section (1) of section 42 of the Principal Act, before the existing proviso the following proviso shall be inserted, namely:

"Provided, that when sale of taxable goods is made by a registered dealer to another such dealer, the amount of tax shall be shown separately in the Act, invoice or cash memoranda."

(2) In sub-section (1) in the existing proviso after the word "provided" the word "further" shall be inserted.

23. Amendment of section 48.

For sub-section (6) of section 48 of Principal Act, the following shall be substituted, namely:

"(6) Subject to such procedure as may be prescribed and after such further inquiry as it may think fit.

(a) the Appellate Deputy Commissioner shall dispose of every appeal within one calendar year from the date of filling of such appeal. In disposing of such appeal, the Appellate Deputy Commissioner may confirm, reduce, enhance or annul the assessment of tax or imposition of penalty or both but shall not remand the case.

(b) the Tribunal may,

(i) confirm, reduce, enhance or annul the assessment of tax or imposition of penalty or both; or

(ii) set aside the assessment or the imposition of penalty or both and direct the officer whose order of assessment or imposition of penalty has been appealed against to make a fresh assessment or re-impose penalty, after making such enquiry as it may direct; or

(iii) pass such order as it may deem fit."

24. Amendment of section 49.

In section 49 of Principal Act,

(1) In clause (ii) of sub-section (1) after words "he thinks fit", the words "within one calendar year from the date of filling such application for revision" shall be added.

(2) After sub-section (1) the following sub-section shall be inserted, namely:

"(I-A) Notwithstanding anything contained in sub-section (1), if the revision under subsection (1) is in respect of an order of re-assessment or re-imposition of penalty in pursuance to of any direction given in appeal or revision, the Commissioner may pass an order in accordance with the provisions of subsection (1), but shall not remand the case."

25. Insertion of section 57-A.

After section 57 of the Principal Act, the following section shall be inserted, namely:

"57-A. Survey,

(1) With a view to identify dealers who are liable to pay tax under the Act, but have remained unregistered, the commissioner, may from time to time, cause a survey of unregistered dealers to be taken.

(2) For the purpose of the survey, the commissioner may, by general or special notice require any dealer or class of dealers to furnish the names, addresses and such other particulars as he may find necessary relating to the persons and dealers who have purchased any goods from or sold any goods to such dealer or class of dealers during any given period.

(3) For the purpose of survey, the commissioner may call for details and particulars regarding the services provided by public utilities and financial institutions including banking companies, which he is of the opinion will be relevant and useful for the purposes of the survey.

(4) The commissioner may, for the purposes of the survey enter any place where a dealer is carrying business, but is unregistered or has not applied for grant of the certificate of registration, whether such place is principal place of business or not and require any proprietor, employee or any other person who may at that time and place be attending in any manner to, or helping in, the business,

(i) to afford him the necessary facility to inspect such books of accounts or other documents as he may require and which may be available at such place,

(ii) to afford him the necessary facility to check or verify the cash, stock or other valuable particulars or things which may be found therein, and

(iii) to furnish such information as he may require as to any matter which may be useful for, or relevant to any proceedings under this Act.

Explanation-For the purpose of this section a place where the person is engaged in business will also include any other place in which the person engaged in business or the said employee or other person attending or helping in business states that any of the books of accounts or other documents or any part of the cash, stock or other valuable articles or things relating to business are kept.

(5) The commissioner shall enter the place where the person is carrying on business only during the hours at which such place is open for business and in case of the said place or any other place, only after sunrise and before sunset. The commissioner may make or cause to be made extracts or copies from books of accounts, and other documents inspected by him, make an inventory of any cash stock or other valuable articles or things checked or verified by him and record the statement of any person which may be useful for or relevant to any proceeding under this Act.

(6) The commissioner, in exercise of the powers under this section, shall not remove or cause to be removed on any account from the place, where he has entered any books of accounts, other documents or any cash, stock or other valuable articles or things."

26. Amendment of section 72.

For sub clause (b) of clause (i) of section 72 of the Principal Act, the following shall be substituted, namely:

"(b) any right, privilege, obligation or liability acquired, accrued or incurred under the repealed Act, including the facility of exemption from payment of tax/deferment of payment of tax extended to any registered dealer under that Act for his having established new industrial unit in the state or undertaken expansion, modernisation or diversification in such industrial unit.

Provided that the facility of exemption from payment of tax / deferment of payment of tax extended to any registered dealer under that Act for his having established new industrial unit in the state or undertaken expansion, modernisation or diversification in such industrial unit, shall be suitably amended / modified as per the provisions of this Act. For this purpose the state government may issue fresh notification or amend the notification issued under the repealed Act."

27. Amendment of section 73.

In section 73 of the Principal Act,

(1) In sub-section (2) after the words "on the date of commencement of this Act" the words "which have been purchased not earlier than twelve months from such date and" shall be inserted.

(2) In clause (ii) of sub-section (2) after the words "at rate of four percent" the words "or at the rate reduced under sub-section (5) of section 8 of Central Sales Tax Act, 1956 (No. 74 of 1956)" shall be inserted.

(3) In clause (a) of sub-section (3) after the words "are goods manufactured out of tax paid goods" the words "which have been purchased not earlier than twelve months from such date" shall be inserted.

(4) In clause (b) of sub-section (3) after the words "on the date of commencement of this Act" the words "which have been purchased not earlier than twelve months from such date and" shall be inserted.

28. Amendment of Schedule I.

For existing Schedule I of the Principal Act, the following shall be substituted, namely:

Schedule - I

(See Section 15)

(Tax Free Goods)

29. Amendment of Scheudle II

For the existing Schedule of the Principal Act, the following shall be substituted, namely:-

SCHEDULE II

(See Section 8)

PART I

SCHEDULE II

(See Section 8)

PART II

SCHEDULE II

(See Section 8)

PART III

SCHEDULE II

(See Section 8)

PART IV

30. Amendment of Scheudle III

For Schedule III of the Principal Act, the following be substituted, namely:-

SCHEDULE - III