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THE KERALA VALUE ADDED TAX ACT, 2003
CHAPTER VI : INSPECTION OF BUSINESS PLACES AND ACCOUNTS AND ESTABLISHMENT OF CHECK POSTS

Body 42. Audit of accounts and certification of returns.-

(1) Every dealer whose total turnover in a year exceeds rupees sixty lakhs shall get his accounts audited annually by a Chartered Accountant or Cost Accountant and shall submit copy of the audited statement of accounts and certificate, in the manner prescribed.

Provided that a co-operative society registered or deemed to be registered under the Kerala Co-operative Societies Act, 1969 (21 of 1969), may in lieu of the statement and certificate mentioned above, submit a copy of the audited statement of accounts and certificate issued by the Registrar of Co-operative Societies on or before 31st day of December of the year succeeding to the year to which annual return relates.

Provided further that the Khadi and Village Industries Units shall, in lieu of the Statement and Certificate mentioned above, submit copy of the audited statement of accounts and certificate issued by the Kerala Khadi and Village Industries Board.

Provided also that with respect to units of Kerala State Electricity Board Ltd. which obtained separate registration as per sub-section (3) of section 20 shall file trial balance for each such units, along with audited statement of accounts and certificate of the company.

(2) Where any dealer detects any omission or mistake in the annual return submitted by him with reference to the audited figures, he shall file revised annual return rectifying the mistake or omission along with the audit certificate. Where, as a result of such revision, the tax liability increases, the revised return shall be accompanied by proof of payment of such tax, interest due thereon under sub section (5) of section 31, and penal interest, calculated at twice the rate specified under sub section (5) of section 31:

Provided that this sub-section shall not apply to a dealer against whom any penal action is initiated in respect of such omission or mistake under any of the provisions of this Act.

Provided further that those dealers who have filed audited statement of accounts and certificates under sub-section (1) will be allowed to revise the returns for the period up to June, 2017, in respect of defects of a technical or clerical in nature, having no effect on the sales turnover already conceded or the tax paid. Such dealers may apply for revision of their returns before the assessing authority on or before 30th September, 2019:

Provided also that this facility shall not be available to dealers against whom assessment proceedings have already been initiated based on such defects:

Provided also that such revision shall be allowed on the basis of the instructions issued by the Commissioner of State Tax from time to time.

(3) Notwithstanding anything to the contrary contained in this Act, if a dealer,

    (i) fails to file audited accounts referred to in sub-section (1), or

    (ii) fails to file revised annual return rectifying the mistake or omission, along with the audited statement of accounts and certificate or if the variance in the audited statement of accounts with the returns is not satisfactorily explained in the reconciliation statement prescribed, or

    (iii) fails to file the annexures, statements, certificates, declarations, including the statutory declarations to be filed under the Central Sales Tax Act, 1956 which are required to be filed along with the returns to prove the correctness of the concessional rate of tax, exemptions and exports claimed in the returns, or

    (iv) fails to declare any sale, purchase or interstate stock transfer as evidenced from the documents prescribed under section 46 available with the assessing authority in the sales and purchase lists filed along with the returns, the assessment of such dealer for the relevant year for the purpose of section 25 shall be treated as pending and the time limit mentioned thereunder shall not be applicable in such cases.