KARNATAKA ACT NO 17 OF 2012

(First Published in the Karnataka Gazette Extra-ordinary on the thirty first day of March, 2012)

THE KARNATAKA VALUE ADDED TAX (AMENDMENT) ACT, 2012

(Received the assent of the Governor on the thirty first day of March, 2012)

An Act further to amend the Karnataka Value Added Tax Act, 2003.

Whereas it is expedient further to amend the Karnataka Value Added Tax Act, 2003 (Karnataka Act 32 of 2004) for the purposes hereinafter appearing;

Be it enacted by the Karnataka State Legislature in the Sixty third year of the Republic of India, as follows.-

1. Short title and commencement.-

(1) This Act may be called the Karnataka Value Added Tax ( Amendment) Act, 2012.

(2) It shall come into force with effect from the First day of April, 2012.

2. Amendment of section 4.-

In the Karnataka Value Added Tax Act, 2003 (Karnataka Act 32 of 2004) (hereinafter referred to as the principal Act), in section 4, in sub-section (1),

(i) in clause (b), in sub-clause (ii), for the words "fifteen per cent" the words "seventeen per cent" shall be substituted;

(ii) at the end, the following proviso shall be and shall always be deemed to have been inserted, namely:-

"Provided that the rate of tax in respect of declared goods as specified in section 14 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956) shall be four per cent from Eighth day of April, 2011 to Eleventh day of April, 2011."

3. Amendment of section 11.- In section 11 of the principal Act, for sub-section (c), the following shall be substituted, namely:-

"(c) Input tax shall not be deducted by any dealer executing a works contract,

(i) in respect of the amount paid or payable to any sub-contractor as the consideration for execution of part or whole of such works contract for him, that is claimed as deduction; and

(ii) in respect of the amount actually expended towards labour and other like charges not involving any transfer of property in goods in connection with the execution of works contract, that is claimed as deduction."

4. Omission of section 18-A.- Section 18-A of the principal Act shall be omitted.

5. Omission of section 30.- Section 30 of the principal Act shall be omitted.

6. Amendment of section 35.-

In section 35 of the principal Act, for sub-section (4), the following shall be substituted, namely:-

"(4) If any dealer having furnished a return under this Act, other than a return furnished under sub-section (3) of Section 38, discovers any omission or incorrect statement therein, other than as a result of an inspection or receipt of any other information or evidence by the prescribed authority,

(a) he shall furnish a revised return within the time prescribed for filing the return for the succeeding tax period; and

(b) he shall furnish a revised return any time thereafter but within six months from the end of the relevant tax period, if so permitted by the prescribed authority."

7. Amendment of section 40.-

In section 40 of the principal Act, for sub-sections (1) and (2), the following shall be substituted, namely:-

"(1) An assessment under section 38 or re-assessment under Section 39 of an amount of tax due for any prescribed tax period shall not be made after five years after the end of the prescribed tax period.

Provided that an assessment or reassessment relating to any tax period upto the period ending 31st day of March, 2007 shall be made within a period of eight years after the end of the prescribed tax period.

Provided further that an assessment or reassessment relating to any tax period commencing from the 1st day of April, 2007 upto the period ending 31st day of March, 2012 shall be made within a period of seven years after the end of the prescribed tax period.

(2) Notwithstanding anything contained in sub-section (1), if any tax is, not paid by a dealer who has failed to get registered though liable to do so or fraudulently evaded attracting punishment under Section 79, an assessment or reassessment may be made within eight years from the end of the prescribed tax period.

Provided that an assessment or reassessment relating to any tax period upto the period ending 31st day of March, 2007 shall be made under this sub-section within a period of ten years after the end of the prescribed tax period."

8. Amendment of section 53.-

In section 53 of the principal Act, in sub-section (2), before the Explanation, the following proviso shall be inserted, namely:-

"Provided that the Commissioner may notify the website in which the particulars prescribed to be contained in the declaration specified under clause (d) shall be entered in respect of any specified class of goods or any specified class of dealers or as a result of any specified class of transactions as may be notified by him. Where the Commissioner has so notified the website, the owner or the person in charge of the goods vehicle or a boat or a ship or similar vessel shall enter the above particulars in the notified website and shall produce proof of entering the particulars in such website, before the officer-in-charge of the checkpost or barrier or any other empowered officer."

9. Amendment of section 54.-

In section 54 of the principal Act,- (i) in sub-section (1),

(a) for the words "Where a vehicle carrying goods taxable under this Act" the words "where a vehicle carrying goods as may be notified by the Government or the Commissioner" shall be substituted; and

(b) for the proviso, the following shall be substituted, namely:-

"Provided that the Commissioner may notify the website in which the necessary information shall be furnished by the driver or any other person-in-charge of the vehicle after entry of such vehicle into the State or after its movement has commenced from the State, for issue of a transit pass. Where the Commissioner has so notified the website, the driver or any other person in charge of the vehicle after entry of the vehicle into the State or after movement has commenced from the State, shall enter the above information in the notified website for issue of a transit pass."

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

"Provided that the Commissioner may notify the website in which the driver or the person in charge of the vehicle shall enter the particulars of the transit pass obtained under sub-section (1), before his exit from the State on a route where no checkpost or barrier is situated. Where the Commissioner has so notified the website, the driver or the other person in charge of the vehicle shall enter the particulars of the transit pass obtained under sub-section (1) in the notified website before his exit from the State."

10. Amendment of section 62.-

In section 62 of the principal Act, in sub-section (4),

(i) in clause (a), for the words "payment of tax and penalty" the words "payment of tax and other amount" shall be substituted.

(ii) in clause (c),

(a) for sub-clause (i), the following shall be substituted, namely:-

"(i) The appellate authority may, in its discretion, stay payment of one half of tax and other amount, if the appellant makes payment of the other half of the tax and other amount along with prescribed form of appeal."

(b) in sub-clause (ii), for the words "subject to payment of one half of the tax disputed" the words "subject to payment of one half of the tax and other amount disputed" shall be substituted.

(iii) clause (e) shall be omitted.

11. Amendment of section 69.-

In section 69 of the principal Act, sub-section (2-A) shall be omitted.

12. Amendment of section 72.-

In section 72 of the principal Act, after sub-section (6), the following shall be inserted, namely:-

"(7) Any dealer who fails to submit returns as required by the provisions of the Act continuously for three months or two quarters, as a case may be, shall on conviction, in addition to recovery of any tax or penalty or interest or other amount that may be due from him or levied on him, be punishable with simple imprisonment which may extend to six months or with a fine which shall not be less than five thousand rupees but which may extend to twenty five thousand rupees or with both and when the offence is a continuing one, with a daily fine not exceeding two hundred rupees during the period of continuance of the offence."

13. Amendment of section 74.-

In section 74 of the principal Act, in sub-section (1),

(i) for the words "two thousand rupees" the words "five thousand rupees" shall be substituted;

(ii) for the words "five thousand rupees" the words "ten thousand rupees" shall be substituted.

14. Amendment of section 75.-

In section 75 of the principal Act, for the words "five thousand rupees" the words "ten thousand rupees" shall be substituted.

15. Amendment of section 80.-

In section 80 of the principal Act, for the words and figures "under Section 79" in the two places they occur, the words "under section 72 or 79" shall be substituted.

16. Amendment of First Schedule.-

In the First Schedule to the principal Act,

(i) for the entry relating to serial number 4, the following shall be substituted, namely:-

"4. All varieties of textiles and fabrics but excluding those specified elsewhere in Third Schedule or notified by the Government."

(ii) for the entries relating to serial number 47, the following shall be and shall be deemed to have been substituted from Eighth day of April, 2011, namely:-

"47. Sugar other than sugar candy, confectionery and the like."

17. Amendment of Third Schedule.-

In the Third Schedule to the principal Act, after the entries relating to serial number 29, the following shall be inserted, namely:-

"29. HDPE and other plastic woven fabrics."

18. Amendment of Sixth Schedule.-

In the Sixth Schedule to the principal Act, after the entries relating to serial number 6, the following shall be inserted, namely:-

By Order and in the name of the Governor of Karnataka

G.K. BOREGOWDA

Secretary to Government,

Department of Parliamentary Affairs and Legislation