Kerala act 018 of 1987 : The Kerala Finance Act, 1987 (Act 18 of 1987)

ACT

18 OF 1987

THE KERALA FINANCE

ACT,

1987

An Act to

give

qfict ^tacertazn

financzal proposal: of

the

Government

of

Kerala for ^the

financial ^year1987-88. Preamble—WHEREAS ^itis

expedient ^to

give

effect ^to

certain

financial proposals ^oftheGovernment^ofKerala^{for the}financial^year1987-88; BE ^itenacted ^{in the}

Thirty~eighth

Year^{of the}

Republic

of India as g follows:—

1. Short title and

commencemmL—(l)

This Act may ^be

called

the Kerala '

Finance

Act,

1987.

'

(2) ^Itshall^bedeemed ^{tohavecome into}force^{on the15:}

day ^of July,

1987.

'

2. Amendment

of ^{Act 15}

of

1963—111 ^the

Kerala

General Sales

Tax Act, ¹⁹⁶³

(15 ^of

1963),— (l)' ^In

section ^2,—— \

(a) ^for

clause

(xii), ^the

following

clause shall ^be

substituted,

namely ^:—

"(xii)

"goods"

means^allkinds^ofmovable property (other ^than newspapers, actionable

claims,

clectricrty,

stocks^and

shares and

securities) and includes

live-stock, ^all

materials,

commodities^andarticles

(including those ^tobeused ⁱⁿ

the

construction,

fitting

out,

improvement[or repair of immovable

property ^or

used^inthe

fitting

out,

improvement

or repair ^ofmovable

property) ^andevery^kindof

property (whether ^as goods ^orinsomeother

form)

involved^inthe

execution^of3

works contract, andall

growing crops,

grass ^or

things

attached^{to, or}

forming part ^{of theland}which ^are

agreed ^tobe

severed

before^saleor

under the

contract of

sale;";

(b) ⁱⁿ

clause

(xxi), ^forthe

Explanation (3A), ^the

following Explana- tion shall be

substituted,

namely ^:—

"Explanatz'on (3A).——A

transfer ^of

property ⁱⁿ

goods (whether ^as goods ^{orin some}other

form)

involved^intheexccmion^of3.

works 5 contract shall be

deemed

to

be

a

sale";

3 3 /3 424/MC. ^{.A , .}

i... L,'

2

(c) ⁱⁿ

clause

(xxvii), ^inthe

Explanation (1A), ^forsub-clause

(i), the

following

sub-clause shall be

substituted,

namely

:—

"(i) ^The

turnoverⁱⁿ

respect

ofworks contract

shall ^bethe

aggregate amount received or

receivable

by

the

dealer for the transfer of goods.(whether as

goods

or in some

other

form)

involved in the execution

of

such

contract;";

(2) ⁱⁿsection ^5,——

(a) ⁱⁿ

sub-section

(1), ^for

clauses ^{(ii) and}

(iii), ^the

following

clauses shall be

substituted,

namely:—-— 'f(ii) ^inthecaseof

goods ^not

specified ^{in the}First ^or

Second^or Fourth ^or

Fifth Schedule and not

coming

under

clause

(iii)

at the rate 0 f five per ^centatall

pomts

of

sale; '

(iii) ^{inthecase of}transfer^ofthe

right ^touse

any goods ^forany purpose (whether ^ornotfor^a

specified period) ^atthe ^rate

of

five per ^{cent at}all

points

of

such

transfer^{on an}

aggregate

turnover of

fifty thousand rupees^and

above;

(iv) ^inthecaseoftransfer ^of

goods

involved^{in the}

execution^ofworks contracts

(whether

the

transfer

is in the

form

of

goods ^orin some other

form)

specified

in the Fourth Schedule at the rate

specified against ^suchcontract^inthesaid

Schedule; ^and

(v) ^inthecaseof

goods specified ^intheFifth

Schedule ^attherates and ^atthe^two

points specified against

such

goods

inthe said

Schedule:

Provrded ^thatwhere there^arenotwo

points'

of^saleor

purchase ^inthe State ^forany goods,

the rates

specified

for^thefirst^saleorlast

purchase, ^asthe case

may be,

in the

said Schedule shall

apply

to such

sale^or

purchase";

(b) ^forsub-sections

(2) ^and

(3), ^the

following sub-sections

shall^be substituted,

namely:— ^.

"(2)

Every

dealer other^{than a}

dealer referred^toinsub-section

(1)

whose total turnover for a

year in

respect

of the

goods specified

in

the First or Second or Fifth

Schedule or

goods

involved in the execution of works

contract

(whether

it ^is

in

the

form

of

goods

or in some other form)

specxfied ^iiithe

Fourth Schedule^{isnotless than}

fifty

thousand rupees shall'^{pay taxat}the rateand

only ^at

the

point ^or

points specified against ^the

goods ^intheFirst ^or

Second^orFifth Schedule^or

good involved ^intheexecution^ofworks contract

(whether ^{itis intheform} of

goods ^orin^someother

form)

specified

in the Fourth

Schedule,

as the case

may be, ^onhis taxable

turnover in that year relating

to such goods:

'

Provided that where a

tax has been levied under

sub-section

(1)

or sub-section

(2) ^of

this:

section^orunder section^5Ain

respect ^ofthesale ^or

Q

-..._.7_ .__..._

O ³

purchase ^of

goods

specified ^{in the}

Second

Schedule^andsuch

goods ^aresold in the course of interstate trade

or

commerce, the tax

so lev1ed shall

be

refunded ^. to

such person in such manner and

subject

to such condiuons as

may be prescribed. (2A) (i) Notwithstanding anything

contained^{inthis Actorthe}rules made

thereunder, every dealer whose total turnover in a

year exceeds rupees twenty-five

lakhs shall pay

turnover^{taxat the rateof hall}per

centum^onthe turnover of

goods coming under the First^or

Fifth Schedule to lb)" Act:

Provided that no^tax

under this

sub-section

shall be

payable

on

that

part of such

tumover,——

)

(i) ^onwhich ^tax15leviable^{on such}dealer under sub-section (1 ^orsubsection

(2),— (ii)

which

relates^to,—

(a) ^saleor

purchase ^of

goods ^inthecourse^ofmterstate trade^or commerce;

(b) ^saleor

purchase ^of

goods ^inthecourse^of

export ^{outof the} territory ^ofIndia^orsaleor

purchase ^inthe

course ^of

import into ^the

territory

of

India;

(c) ^saleor

purchase exempted ^fromtax

by

notification under section

10;

(d) ^allamounts

falling

under^{the head}

'fre1ght', ^when

specified and

charged

for

by

the dealer

separately

without

including such amountsⁱⁿ

the

price

of the

goods

sold;

(6) ^allamounts

falling

under^{the head}

'charges ^For

dehvery'

,

when

specified

and

charged

for

by

the dealer

separately

without '

including ^suchamounts^inthe

price ^ofthe

goods

sold;

(f) ^allamounts allowed^as

discoun',

provided ^{that such}

discount is

allowed in accordance with the

regular practice

of' the dealer or is in accordance with the

terms of a contract or

agreement entered

into

in ^a

particular

case and

provided

also that

the accounts show that the

purchaser

has

paid only

the sum originally

charged ^less

discount;

(g) ^allamounts

allowed ^to

purchasers¹ⁿ

respect ^of

goods

returned by ^themtothedealer^whenthe

goods ^aretaxable^onsales provided ^thatthe

goods ^werereturned within ^a

period ^of

three month" from^the

date of

delivery

of ^the

goods

and^theaccounts show the

date

on

which the

goods ^were

returned ^andthe^date

,

on

which

and the amount for

which

refund

was

made;

and

3

4

O

(h) ^allamounts received^{from the}

sellersⁱⁿ

respect ^of

goods ^re turned to them

by

the

dealer,

when the

goods

are taxable on

the

purchase

value

provided

that the

goods

were returned within a

period ^ofthree months^fromthe date

of

delivery

of the

goods

and

the accounts show

the date on

which the

goods were returned and. the

date^on

which and the amount for which refund ^wasreceived:

Provided

further^{that save as}

otherwise

provided

in this

sub-section, ^no other deduction shall^{be made}

from^thetotal turnover^ofa

dealer ^forthe purposes ^ofthis sub-section.

(ii) ^The

provisions ^{ofthisActandthe}rules^made

thereunder

shall, so far^as

may be,

apply

in relation to the

assessment, collection

or refund of the turnover ^tax

under this sub-section

including

the

provisions

relating ^to appeals ^and

penalties, ^{as they}apply ⁱⁿ

relation^totheassessment, collection or refund

of tax

under the other

provisions

of

this Act. '

(3)

Notwithstanding

anything

containedⁱⁿsub-section

(1) ^orsub-section (2), ^thetax

payable

by ^adealerⁱⁿ

respect

ofany^saleofmdustrial^raw

materials, component parts ^or

packing

materials which ^is

liable^{to tax at arate}

higher than ^tw0

per ^{cent whensoldto}industrial

units^foruseinthe

production ^of finished

products

inside the State^forsale^orfor

packing ^ofsuchfinished products

inside ^the

State^for

sale, ^{asthecase maybe,}

shall^{be atthe rate of} only ^two

per ^centonthetaxable turnover

relating ^tosuchindustrial ^raw materials, component

parts, ^or

packing

materials, ^{as the case}

may ^be:

Provided ^that

this

sub-section shall ^not

apply

where the sale of such finished

products ^isnot liable^totaxeither under^thisActorunder ^theCentral Sales Tax

Act, ¹⁹⁵⁶

(Central

Act 74 of

1956)

or

when such finished

products are

exported

out of the

territory

of India:

Provided further that the

provisions ^ofthissub-section shall ^not

apply ^to any sale unless ^the

dealer

selling

the

goods

furnishes ^to

the

assessing authority in the

prescribed

manner

a declaration

duly

filled in and

signed

by ^thedealer to whom the

goods

are sold

containing

the

prescribed particulars ^mthe

pres- cribed

form."; (c)

sub-sections

(3A) ^and

(7)

shall ^be

omitted;

(3) ⁱⁿ

section ^14,—

(a) ⁱⁿ

sub-section

(1), ^forthewords

"fifty

rupees", ^the

words,

"one

hundred

rupees"

shall

be

substituted;

(b) ⁱⁿ

sub-section

(3), ^forthe

words

"twenty-five

rupees", ^the words

"fifty

rupees"

shall

be

substituted; «A

5

(4) ^fortheFirst

Schedule, ^the

following

Schedule

shall^be

substituted, namely ^:—

"THE

FIRST SCHEDULE

Goods

in

respect

of which

single point

tax is leviable under sub- section

(1) ^or

sub-section

(2) ^of

Section 5 Serial

Description of

Point

of

Rate

oftax No.

good: levy

( Per

cent)

U)

(2) (3)

(4)

l.

Abrasives At the

point

of first

sale In the

State

by

a dealer who is

liable to tax

under section 5 8

2. ^All

Acids do. 6

3

Adhesives do. 8

4.

Agricultural machinery

and implements ^not

falling

under any other entry in^this

Sche- dule

other than hand made do. '

6

5.

Alloys

other

than those men- tioned

in this

Schedule do.

6

6

(1) (2) (3)

(4)

10.

(i) ^Allarms

including

rifles, ^At

the

point

of first sale revolvers,

pistols ^andinthe

State

by ^adealer ammunitions for

them who ^isliable to tax under section ⁵

20

(ii) ^Air

Guns, ^airrifles^and pellets

therefor ^{' do. 20} 1!. Arrack do. 45

12. Articles^madeof

ivory,

horn, rosewood, sandalwood,

coco- nut shell and straw

do.

10

13. Artificial ^silkyarn, synthetic polyester

fibre,

polyester fibre am

and

staple

fibre and

staple

fibre

yam

do. ⁴

14. Asbestos sheets^and

products not elsewhere mentioned

in this

Schedule^{do. 10}

15.

Bakery

products

excluding bread and

biSCuit

do. ⁵

16.

Bangles excluding

those made of

gold,

silver

and

platinum group metals do. ⁵

17.

Batteries other

than

dry

cells do. ¹⁵

[8.

Beds,

mattresses

and

pillows made ^ofcotton^do.6

19. Beedi leaves do. ⁵

20.

Betal

leaves ^{At the}

point ^oflast pur- chase in^theState

by

a dealer who^is

liable to tax

under section 5

5

21.

Bicycles,

tandem

cycles ^andAt^the

point

of first sale cycle

combinations^andacces-^intheState

by ^adealer sories and

parts

thereof who^is

liable to

tax

under ^- section 5 6

(1) (2) (3)

(4)

22.

Binoculars,

telescopes,

micro- ^{At the}

point ^offirst

sale scopes,

magnifying

glasses ^{In the}State

by ^a

dealer and opera glasses ^whois

liable ^totax

under section 5

15

23. Biscuits do. ^{' 8}

24.

Bonded

fibre fabrics

other than those made of

coir

do. 10

25. Boat

(Canoes,

wooden lau- nches) ^not

coming

under

entry '

do 6

125

26.

Bricksdland

tiles

(kiln

burnt)

do 5

27. Bullion and

specie

do. 2

28.

Camphor

do⁶

29. Carbon paper, type

carbon, '

stencil paper ^do8

30. Cardamom do.⁵ 3!. Cashewnut with shell ^At

the

point ^oflastpur- chase in the State

by

a dealer who is

liable to tax

under section

5

5

32. Cashew kernel ^Atthe

point

of

first sale in the State

by

a

dealer who is

liable to tax under section ⁵

5

33. Castor oil do. 5

34.

Cattle ^feed

(including gingili oil

cake,

ground ^nutoil

cake, rice ^branand

poultry

feeds)

do. 5

35. Caustic

soda and caustic

potash

do. 8

(I) ^{<2) (3)(4)}

3c.

Cement,

excluding

white ^At

the

point

of first sale cement ⁱⁿ

the State

by ^adealer who ^is

liable to

tax under section 5 ¹⁰

37.

Cellophane

do.

6

38.

Centrifugal pumps electri— cally

operated ^or

engine operated ^do.,¹⁰

39.

Cigarette

cases

do. 15

40.

Cinematographie

equipments includmg

cameras,

projectors and sound

recording ^{and re-} producing equipments,

lenses, and

parts

and

acces- sories

required ^foruse there- with ^do.15

41..

Chalk

powder ^do.6

42. Chemicals ^notelsewhere specified ^inthis

Schedule ^{do. 8}

43.

Chicory

do.

6

44. Chinaware

and

porcelain ^waredo. 10

45.

Clay

products ^notelsewhere mentioned in this Schedule ^{do. 4}

46.

Clocks,

timepieces

and ^wat- ches and

parts

thereof do. ¹⁵ 47.. ^{Coma Atthe}

point ^of

lastg'pur- chase ^intheState

by ^a dealer

who

is liabley^to tax

under section

5 6

48. Coconuts

(other

than those coming

under declared goods) ^{do. 5}

ii) ^{(2)(3) <4)}

49. Coconut

fibre,

coir yam, ^At

the

point

of last pur- coir

products, ^and

bonded

chase

in^theState

by ^a fibre fabrics ^of

coir

dealer^{who 18}

liable^totax under

section

5

2

50 . Coconut Oil (At^the

point ^of

first^sale in the

State

by

a

dealer who ^is

liable to tax

under section ⁵

5

51. Coconut Oil Cake do. 5 Explalnatzonz—thre ^ataxhas been levied ⁱⁿ

respect ^ofcopra or coconut the tax leviable on coconut oil and coconut oil cake,

produced ^outofsuchco- conut ^or

copra shall be redu- ced

by ^theamount^oftaxlevi- ed on such copra ^orcoconut.

52.

Coffee,

but ^not

including

coffee ,^{At the}

point ^offirst pur« drink ^andfrench cofl'ec chase^intheState

by

a _ dealer who

is

liable to tax

under

section

5 6

Explanation:—Cofi'ee

includes coffee

beans,

coffee seeds

(raw or

roasted)

and coffee

powder except

cofl'ee

powder sold'under a brand name

53. Cofiee

powder

sold under^aAt

the

point

of first^sale brand ^nameinthe

State

by ^a

dealer who ^is

liable to tax

under section ⁵

10

54.

Compounded

asafoetida do. 8

55.

Confectionery, including

tofl'ees

.

and Chocolates ^do.8

56. Concrete

poles

do.⁸ 38 /3424/M6.

10

(1)

(2) (3)

(4)

57. Cooked food

including

bevera-^Atthe

point

of

first sale ges ^not

falling

under any entry

in the

State

by ^adealer in fifth Schedule sold ^orserved

who is

liable to tax

under in ^Bar

attached hotels and ^res-

section 5 10 tauranls

and/or

hotels

above the

gmde

of two stars

58. ^{Corkand cork}sheet ^{do. 8}

59. Cotton

waste^andCotton yarn waste do.

6

60.

Cuddappa

stone and

slabs ^or other similar decorative

stones and

slabs

do. ¹⁵

61 ^.

Curd^andButter^milk

do. ⁵

62.

Denatured

spirit

do.

8

63.

Detergent powders,

flakes^and liquids ^and

laundry

brightners ^do.8 64-.

Dictaphone

and similar appa- ratus for

recording

and ^re- producing

sound^andspare parts ^andaccessories thereof^do.15

65.

Dry ^Cell

do.

10

66.

Dye

stuff^do..10

67. Electrical

goods, (other 1than those

Specifically

mentioned in this

Schedule)

instruments, app- aratus,

appliances

including fan and

lighting

bulbs,

electrical

4'

(I) (2) (3) (4)

earthernwares and

porcelain

and At the

point

of

first sale all other

accessories and

com-

in the State

by

a

dealer ponent

parts,

either ^{sold as a who is}

liable^totax

under whole ^or

in

parts.

section 5¹⁰ 68 . Electronic

systems, instruments, apparatus ^and

appliances

other than those

specified

elsewhere ^~ in this

Schedule^andspare parts and

accessories thereof ^do.15

69.

Eucalyptus

oil do. 5

70. Fertilizers

viz.——— do. '

2

l?)

(11)

(iii) (iv)

(V)

(vi) (vii) (viii) (iX)

(X)

(xi) (xii) (xiii) (xiV)

(XV)

(xvi) (xvii) Ammonium Chloride Ammonium

Phosphate Sulphate ^ofanydescri- ption

'

Ammonium

Sulphate Ammonium

Sulphate Nitrate Bone meal Chillian Nitrate Calcium Ammonium Calcium Carbonate Di-Ammonium

Phosphate Di-Calcium

Phosphate Dolomite Fused Calcium

Magnesmm Phosphate Kotka

Phosphate Mossori

Phosphate Mono

Ammonium

Phosphate Nitro

Phosphate

of any description

11

(I) (2) (3)

'71.

72.

73.

74 .

75.

(xviii) (xxisi) (xxiv) Potassium Chloride (Muriate ^of

Potash) Rock

Phosphate Sodium Nitrate Sulphate ^of

Potash Super Phosphate single (xiX)

(XX)

(xxi) '(xxii) Super Phosphate

Triple Ultraphosc

(xxv) ^Urea Urea

Ammonium Phosphate (xxvi)

(xxvii) Any

mixture^ofoneor more of

the

articles mentioned in item

(i) to

(xxvi)

above

with or without the

addition of other articles

(on

the turn over

relating

to eoxnponents

thereof which have not

already sufl'ered

tax) Fibre

glass Fireworks

including

coloured matches Fish and fish

preparations

sold in air

tight

containers Flour not

elsewhere mentioned in this

Schedule Foods,

including preparations of

bird's eggs, animal

blood, prawns,

crustaceans

and molluscs

sold

in air

tight containers At the

point

of first sale in the State

by

a

dealer who is

liable to tax

under section ⁵ do.

do.

do.

do.

10

10

IO

10