Madhya Pradesh act 019 of 2017 : The Madhya Pradesh Goods and Services Tax Act,2017

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CHAPTER XIX

OFFENCES AND PENALTIES

122. Penalty for certain offences.

123. Penalty for failure to furnish information return.

124. Fine for failure to furnishstatistics.

125. General penalty.

126. Generaldisciplines related to penalty.

127. Power to impose penaltyin certain cases.

128. Power to waive penalty or fee or both. 129, Detention, seizure and release of goods and conveyancesin transit.

130. Confiscation of goods or conveyancesandlevy of penalty.

131. Confiscation or penalty not to interfere with other punishments.

132. Punishmentfor certain offences.

133. Liability of officers and certain other persons. 134, Cognizance of offences.

135. Presumption ofculpable mentalstate. 136.Relevancy of statements under certain circumstances.

137. Offences by Companies.

138. Compounding ofoffences.

CHAPTER XX

TRANSITIONAL PROVISIONS

139. Migration of existing taxpayers.

140. Transitional arrangements for input tax credit.

141. Transitional provisions relating to job work.

142. Miscellaneoustransitional provisions.

CHAPTER XXI

MISCELLANEOUS

143. Job work procedure. 144, Presumption as to documents in certain cases.

145. Admissibility of micro films, facsimile copies of documents and computer printoutsas documents and as evidence.

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146. CommonPortal.

147. Deemed exports.

148. Special procedure for certain processes,

149. Goods and services tax compliancerating.

150. Obligation to furnish information return.

151. Powerto collect statistics.

152. Bar on disclosure of information.

153. Taking assistance from an expert.

154. Powerto take samples.

155. Burden of proof.

156. Persons deemedto be public servants.

157. Protection ofaction taken underthis Act.

158. Disclosure of information by a public servant.

159. Publication ofinformation in respect of personsin certain cases.

160. Assessmentproceedings,etc. not to be invalid on certain grounds.

161. Rectification of errors apparent on the face of record.

162. Bar on jurisdiction of civil courts.

163. Levy offee.

164. Power of Governmentto makerules.

165. Power to makeregulations.

166. Laying ofrules, regulations and notifications.

167. Delegation of powers.

168. Powerto issue instructions or directions.

169. Service of notice in certain circumstances.

170. Roundingoff oftax etc.

171. Anti-profiteering measure.

172. Removal ofdifficulties.

173. Amendmentofcertain Acts .

174. Repeal and saving. SCHEDULE|

SCHEDULEII

SCHEDULEIII

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MADHYA PRADESH ACT

No. 19 oF 2017

THE MADHYA PRADESH GOODS AND SERVICES TAX ACT, 2017

[Received the assent of the Governor on the 9th June 2017; assentfirst published in the "Madhya Pradesh Gazette (Extra-ordinary)", dated the 12th June 2017].

An Act to make a provision for levy and collection of -

tax on intra-State supply of goods or services or both by

the State of Madhya Pradesh and the matters connected

therewith or incidental thereto -

Be it enacted by the Madhya Pradesh Legislature in the

sixty-eighth year of the Republic of India as follows:-

CHAPTER I

PRELIMINARY

1. (1) This Act may be called the Madhya Pradesh Short title, extent and Goods and Services Tax Act, 2017. commencement.

(2) It extends to the whole of the Madhya Pradesh.

(3) It shall come into force on such date as the State Government may, by notification in the official Gazette, appoint:

Provided that different datesmay be appointed for different provisions of this Act and any reference in any such provision to the commencementof this Act shall be construed as a . reference to the coming into force of that provision.

2. In this Act, unless the context otherwise requires,— Definitions.

(1) "actionable claim" shall have the same meaning as 4 of 1882. assigned to it in section 3 of the Transfer of Property Act, 1882;

(2) "address of delivery" means the address of the — recipient of goods or services or both indicated on the tax invoice issued by a registered person for delivery of such goodsor services or both;

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(3) "address on record" means the address of the recipient as available in the records of the supplier;

(4) "adjudicating authority" means any authority, appointed or authorised to pass any order or decision under this Act, but does not include the Commissioner, Revisional Authority, the Authority for Advance Ruling, the Appellate Authority for Advance Ruling, the Appellate Authority and the Appellate Tribunal;

(5) "agent" means a person, including a factor, broker, commission agent, arhatia, del credere agent, an auctioneeror any other mercantile agent, 'by whatever name called, who carries on the' business of supply or receipt of goods or services or both on behalf of another;

(6) "aggregate turnover" means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter- State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Unionterritory tax, integrated tax and cess;

(7) "agriculturist" means an individual or a Hindu Undivided Family who undertakes cultivation of land—

(a) by own labour, or -

(b) by the labour of family, or

(c) by servants on wages payable in cash or kind or by hired labour under personal supervision or the personal supervision of any memberofthe family;

(8) "Appellate Authority" means an_ authority appointed or authorised to hear appeals as referred to in section 107;

(9) "Appellate Tribunal" means the Goods and Services Tax Appellate Tribunal! referred in 'section 109;

(10) "appointed day" means the date on which the provisions of this Act shall comeinto force;

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(11) "assessment" means determination of tax liability under this Act and includes self- assessment, re-assessment, provisional assessment, summary assessment and best judgement assessment;

(12) "associated enterprises" shall have the same 43 of 1961. meaning as assigned to it in section 92A of the Income-tax Act, 1961;

(13) "audit" means the examination of records, returns and other documents maintained or furnished by the registered person under this Act or the rules made thereunder or under any other law for the time being in force to verify the correctness of turnover declared, taxes paid, refund claimed and input tax credit availed, and to assess his compliance with the provisions ofthis Actor the rules made thereunder;

(14) "authorised bank" shall mean a bank or a branch of a bank authorised by the Central Governmentto collect the tax or any other amount payable underthis Act;

(15) "authorised representative" means _ the representative as referred to under section 116;

(16) "Board" means the Central Board of Excise 54 of 1963. and Customsconstituted under the Central Boards ofRevenue Act, 1963;

(17) "business" includes—

(a) any trade, commerce, manufacture, profession, vocation, adventure, wager or any other similar activity, whether or not it is for a pecuniary benefit;

(b) any activity or transaction in connection with or incidental or ancillary to sub-clause (a);

(c) anyactivity or transaction in the nature of sub- clause (a), whether or not there is volume, frequency, continuity or regularity of such transaction;

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(d) supply or acquisition of goods including capital © goods and. services in connection with commencementor closure of business;

(e) provision by a club, association, society, or any such body (for a subscription or any other. consideration) of the facilities or benefits to its members;

(f) admission, for a consideration, of persons to any premises;

(g) services supplied by a person as the holder of an office which has been accepted by him in the course or furtherance of his trade, profession or vocation;

(h) services provided by a race club by way of totalisator or a licence to book maker in such club; and

(i) any activity or transaction undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities;

(18) "business vertical' means a distinguishable componentof an enterprise that is engaged in the supply of individual goods or services or a group of related goods or services which is subject to risks and returns that are different from those of

. the other businessverticals. Explanation.—For the purposes of this clause, factors that should be considered in determining whether goods or servicesare related include—

(a) the nature of the goodsorservices;

(b) the nature of the production processes;

(c) the type or class of customers for the goods or services;

(d) the methods used to distribute the goods or supply of services; and

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(e) the nature of regulatory environment (wherever applicable), including banking, insurance or public utilities;

(19) "capital goods" means goods, the value of whichis capitalised in the books of account of the person claiming the input tax credit and which are used or intended to be used in the course or furtherance of business;

(20) 'casual taxable person" means a person who occasionally undertakes transactions involving supply of goods or services or both in the course or furtherance of business, whether as principal, agent or in any other capacity, in the taxable territory where he has nofixed place of business;

(21) "Central Goods and Services Tax Act" means the Central Goods and Services Tax Act, 2017 (No. 12 of 2017);

(23) "central tax" means the central goods and services tax levied under section 9 of the Central Goods and Services Tax Act;

(23) "cess" shall have the same meaning as assigned to it in the Goods and Services Tax (Compensationto States) Act;

(24) "chartered accountant" means a chartered accountant as defined in clause (b) of sub-section

(1) of section 2 of the Chartered Accountants Act, 1949;

(25) "Commissioner" means the Commissioner of State tax appointed undersection 3;

(26) "Commissioner in the Board" means the Commissioner referred to in section 168 of the Central Goods and Services Tax Act;

(27) "common portal" means the common goods and services tax electronic portal referred to in section 146;

(28) "common working days" shall mean such days in succession which are not declared as gazetted holidays by the Central Government or the Government of Madhya Pradesh;

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(29) "company secretary" means a company secretary as defined in clause (c) of sub-section

(1) of section 2 of the Company Secretaries Act, 1980;

(30) "competent authority" means such authority as may be notified by the Government;

(31) "composite supply" means a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one ofwhichis a principal supply;

Illustration: Where goods are packed and transported with insurance, the supply of goods, packing materials, transport and insuranceis a composite supply and supply of goodsis a principal supply.

(32) "consideration" in relation to the supply of goodsorservices or both includes—

(a) any payment made or to be made, whether in moneyorotherwise, in respect of, in responseto, or for the inducementof, the supply of goods or services or both, whether by the recipient or by any other person but shall not include any subsidy given by the Central Governmentor a State Government,

(b) the monetary valueof any act or forbearance, in respect of, in response to, or for the inducementof, the supply of goodsor services or both, whether by the recipient or by any other person butshall not include any subsidygiven by the Central Government or a State Government:

Provided that a deposit given in respect of the supply of goods or services or both shall not be considered as payment made for such supply unless the supplier applies such deposit as consideration for the said supply;

(33) "continuous supply of goods" means a supply of goods which is provided, or agreed to be provided, continuously or on recurrent basis,

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23 of 1959. 21 of 2000. — Feage ues, fei 12 Yt 2017 under a contract, whether or not by means of a wire, cable, pipeline or other conduit, and for which the supplier invoices the recipient on a regular or periodic basis and includes supply of such goods as the Government may, subject to such conditions, as it may, by notification, specify;

(34) "continuous supply of services" means a supply ofservices which is provided, or agreed to be provided, continuously or on recurrent basis, under a contract, for a period exceeding three months with periodic payment obligations and includes supply of such services as_ the Government may, subject to such conditions,asit may, by notification, specify;

(35) "conveyance" includesa vessel, an aircraft and a vehicle;

(36) "cost accountant" means a cost accountant as defined in clause (c) of sub-section (1) of section 2 of the Cost and Works Accountants Act, 1959;

(37) "Council" means the Goods and Services Tax Council established under article 279A of the Constitution;

(38) "credit note" means a document issued by a registered person under sub-section (1) of section 34;

(39) "debit note" means a document issued by a registered person under sub-section (3) of section 34;

(40) "deemed exports" means such supplies of goods as may benotified under section 147;

(41) "designated authority" means such authority as may benotified by the Commissioner;

(42) "document" includes written or printed record of any sort and electronic record as defined in clause (t) of section 2 of the Information Technology Act, 2000;

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(43) "drawback" in relation to any goods manufactured in India and exported, means the rebate of duty, tax or cess chargeable on any imported inputs or on any domestic inputs or input services used in the manufacture of such goods;

(44) "electronic cash ledger" means the electronic cash ledger referred to in sub-section (1) of section 49; "

(45) "electronic commerce" means the supply of. goods or services or both, including digital products overdigital or electronic network;

(46) "electronic commerce operator" means any person who owns, operates or managesdigital or electronic facility or platform for electronic commerce;

(47) "electronic credit ledger" means the electronic credit ledger referred to in sub-section (2) of section 49;

(48) "exempt supply" means supply of any goods or services or both whichattracts nil rate of tax or which may be wholly exempt from tax under section 11, or under section 6 of the Integrated Goods and Services Tax Act, 2017 (No. 13 of 2017) and includes non-taxable supply;

(49) "existing law" means any law, notification, order, rule or regulation relating to levy and collection of duty. or tax on goods or services or both passed or made before the commencement of this Act by the Legislature or any Authority or person having the power to make such law, ' notification, order, rule or regulation;

(50) "family" means,—

(i) the spouse and children of the person, and

(ii) the parents, grand-parents, brothers and sisters of the person if they are wholly or mainly dependenton the said person;

(51) "fixed establishment" means a place (other than the registered place of business) which is characterised by a sufficient degree of

. permanence and suitable structure in terms of

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80 of 1976 Feqe Usa, fear 12 4A 2017 human andtechnical resources to supply services, or to receive and use servicesfor its own needs;

(52) "Fund" means the Consumer Welfare Fund established undersection 57;

(53) "goods'? means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or undera contract of supply;

(54) "Government" means the Government of Madhya Pradesh;

(55) "Goods and Services Tax (Compensation to States) Act" means the Goods and Services Tax (Compensation to States) Act, 2017 (No. 15 of 2017); .

(56) "goods and services tax practitioner" means any person whohas been approved undersection 48 toact as such practitioner;

(57) "India" means the territory of India as referred to in article 1 of the Constitution, its territorial waters, seabed and sub-soil underlying such waters, continental shelf, exclusive economic zone or any other maritime zone as referred to in the Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976, and the air space above its territory and territorial waters;

(58) "Integrated Goods and Services Tax Act"

meansthe Integrated Goods and Services Tax Act, 2017 (No. 13 of 2017);

(59) "integrated tax" means the integrated goods and services tax levied underthe Integrated Goods and Services Tax Act;

(60) "input" means any goods other than capital goods used or intended to be used by a supplier in the course or furtherance of business;

(61) "input service" means any service used or intended to be used by a supplier in the course or furtherance of business;

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(62) "Input Service Distributor" meansan office of the supplier of goods or services or both which receives tax invoices issued under section 31 towards the receipt of input services and issues a prescribed document for the purposes of distributing the credit of central tax, State tax, integrated tax or Union territory tax paid on the said services to a supplier of taxable goods or services or both having the same Permanent Account Numberasthat ofthe said office;

(63) 'input tax" in relation to a registered person, meansthe central tax, State tax, integrated tax or Union territory tax charged on any supply of goods or services or both made to him. and includes— .

(a) the integrated goods and servicestax charged on import of goods;

(b) the tax payable under the provisions of sub- sections (3) and (4) of section 9;

(c) the tax payable under the provisions of sub- sections (3) and (4) of section 5 of the Integrated Goodsand Services Tax Act; or

(d) the tax payable under the provisions of sub- sections (3) and (4) of section 9 of the Central Goodsand Services Tax Act,

but does not include the tax paid under the composition levy;

(64) "input tax credit" meansthe credit of input tax;

(65) '"'intra-State supply of goods" shall have the same meaningas assignedto it in section 8 of the Integrated Goods and Services Tax Act;

(66) "intra-State supply of services" shall have the same meaning as assignedto it in section 8 of the Integrated Goods and Services Tax Act;

(67) "invoice" or "tax invoice" means the tax invoice referred to in section 31;

(68) "inward supply" in relation to a person, shall mean receipt of goodsor services or both whether by purchase, acquisition or any other means, with or without consideration;

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(69) "job work" means any treatment or process undertaken by a person on goods belonging to another registered person and the expression "job worker"shall be construed accordingly;

(70) "local authority" means—

(a) a "Panchayat" as defined in clause (d) of article 243 of the Constitution;

(b) a "Municipality" as defined in clause (e) of article 243P of the Constitution;

(c) a Municipal Committee, a Zila Parishad, a District Board, and any other authority legally entitled to, or entrusted by the Central Government or any State Governmentwith the control or managementof a municipal or local fund;

(d) a Cantonment Board as defined in section 3 of 41 of 2006. the Cantonments Act, 2006;

(e) a Regional Council or a District Council constituted under the Sixth Schedule to the Constitution;

(f) a Development Board constituted underarticle 371 of the Constitution; or

(g) a Regional Council constituted under article 371A of the Constitution;

(71) "location of the recipient of services" means,-

(a) where a supply is received at a place of business for which the registration has been obtained, the location of such place of business;

(b) where a supply is received at a place other than the place of business for which registration has been obtained (a fixed establishment elsewhere), the location of such fixed establishment;

(c) where a supply is received at more than one establishment, whether the place of business or fixed establishment, the location of the establishment mostdirectly

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(d) in absence of such places, the location of the usual place of residence of the recipient;

(72) "location of the supplierof services" means,-

(a) where a supply is made from a place of business for which the registration has been obtained, the location of such place of business;

(b) where a supply is made from a piace other than the place of business for which registration has been obtained (a fixed establishment elsewhere), the location of such fixed establishment;

(c) where a supply is made from more than -one establishment, whether the place of business or fixed establishment, the location of the establishment most directly concerned with the provisions of the supply; and

(d) in absence of such places, the location of the usual place of residence ofthe supplier;

(73) "manufacture" means processing of raw material or inputs in any mannerthat results in emergence of a new product having a distinct name, character and use and the term

"manufacturer" shall be construed accordingly;

(74) "market value" shall mean the full amount whicha recipient of a supply is required to pay in order to obtain the goods or services or both of like kind and quality at or about the same time and at the same commercial level where the recipient and the supplier are notrelated;

(75) "mixed supply" means two or moreindividual supplies of goods or services, or any combination thereof, made in conjunction with each other by a taxable person for a single price where such supply does not constitute a composite supply. Illustration: A supply of a package consisting of canned _ foods, sweets, chocolates, cakes, dry fruits, aerated drinks and fruit juices when supplied for a single price is a mixed supply. Each of these items can be supplied separately and is not dependent on anyother. It shall not be a mixed supply if these items are supplied separately;

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(76) "money" meansthe Indian legal tender or any foreign currency, cheque, promissory note,bill of exchange, letter of credit, draft, pay order, traveller cheque, money order, postal or electronic remittance or any other instrument recognized by the Reserve Bank of India when used as a consideration to settle an obligation or exchange with Indian legal tender of another denomination but shall not include any currency that is held for its numismatic value;

(77) "motor vehicle" shall have the same meaning as assigned to it in clause (28) of section 2 of the Motor Vehicles Act, 1988;

(78) "non-resident taxable person" means any person who occasionally undertakes transactions involving supply of goods or services or both, whether as principal or agent or in any other capacity, but who has nofixed place of business or residencein India;

(79) "non-taxable supply'' means a supply of goods or services or both which is not leviable to tax under this Act or under the Integrated Goods and Services Tax Act;

(80) '"non-taxable territory' means the territory whichis outside the taxable territory;

(81) "notification" means a notification published in the Official Gazette and the expressions'notify' and 'notified' shall be construed accordingly;

(82) "other territory" includes territories other than those comprising in a State and those referred to in sub-clauses (a) to (e) of clause (114);

(83) "output tax" in relation to a taxable person, means the tax chargeable under this Act on taxable supply of goods or services or both made by him or by his agent but excludes tax payable by him on reverse charge basis;

(84) "outward supply" in relation to a taxable person, means supply of goodsor services or both, whether by sale, transfer, barter, exchange,

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(85)

(86)

"person" includes—

(a) an individual;

(b) a Hindu Undivided Family;

(c) a company;

(d) a firm;

(e) a Limited Liability Partnership;

(f) an association of persons or a body of individuals, whether incorporated or not, in India or outside India;

(g) any corporation established by or under any Central Act, State Act or Provincial Act or a Government companyas defined in clause (45) of section 2 of the Companies Act, 2013;

(h) any body corporate incorporated by or under | the laws of a country outside India;

(i) a co-operative society registered under any law relating to co-operative societies;

(j) a local authority;

(k) Central.Governmentor a State Government;

(1) society as defined under the Societies Registration Act, 1860;

(m)trust; and

(n) every artificial juridical person, not falling within any of the above;

"place of business" includes—

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(a) a place from where the business is ordinarily carried on, and includes a warehouse, a godown or any other place where a taxable person stores his goods, supplies or receives goodsor services or both; or

(b) a place where a taxable person maintains his books of account; or

(c) a place where a taxable person is engaged in business through an agent, by whatever namecalled; (87). "place of supply" meansthe place of supply as referred to in Chapter V of the Integrated Goods and Services Tax Act;

(88) "prescribed'' means prescribed by rules made under this Act on the recommendations of the Council;

(89) "principal" means a person on whosebehalf an agent carries on the business of supply or receipt of goodsor services or both;

(90) "principal place of business" means the place of business specified as the principal place of businessin the certificate of registration;

(91) "principal supply" means the supply of goods or services which constitutes the predominant element of a composite supply and to which any other supply forming part of that composite supply is ancillary;

(92) "proper officer" in relation to any function to be performed under this Act, means the Commissioner or the officer.of the State tax who is assigned that function by the Commissioner;

(93) "quarter" shall mean a period comprising three consecutive calendar months, ending on the last day of March, June, September and December of a calendar year;

(94) "recipient" of supply of goods or services or both, means—

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(a) where a consideration is payable for the supply of goodsor services or both, the person whoisliable to pay that consideration;

(b) where no consideration is payable for the supply of goods, the person to whom the goods are delivered or made available, or to whom possession or use of the goods is given or made available; and

(c) where no consideration is payable for the supply of a service, the person to whom the service is rendered,

and any reference to a person to whom a supply is made shall be construed as a reference to the recipient of the supply and shall include an agent acting as such on behalf of the recipientin relation to the goodsor services or both supplied;

(95) "registered person" means a person who is registered under section 25 but does not include a person having a Unique Identity Number,

(96) "regulations" means the regulations made by the Government under this Act on the recommendations of the Council;

(97) "removal'' in relation to goods, means-

(a) despatch of the goods for delivery by the supplier thereof or by any other person acting on behaif of such supplier; or

(b) collection of the goods by the recipient thereof or by any other person acting on behalf of such recipient;

(98) "return" means any return prescribed or otherwise required to be furnished by or underthis Actor the rules made thereunder;

(99) "reverse charge'' meanstheliability to pay tax by the recipient of supply of goods orservices or both instead of the supplier of such goods or services or both under sub-section (3) or sub- section (4) of section 9, or under sub-section (3)

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(100) "Revisional Authority" means an authority appointed or authorised for revision of decision or orders as referred to in section 108;

(101) "Schedule" means a Schedule appendedto this Act;

(102) "securities" shall have the same meaning as assigned to it in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956;

(103) "services" means anything other than goods, money and securities but includes activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged;

(104) "State" means the State of Madhya Pradesh;

(105) "State tax" means the tax levied under this Act;

(106) "supplier" in relation to any goods or services or both, shall mean the person supplying the said goods or services or both and shall include an agent acting as such on behalf of such supplier in relation to the goodsor services or both supplied;

(107) 'tax period'' means the period for which the return is required to be furnished;

(108) "taxable person" means a person who is registered or liable to be registered under section 22 or section 24;

(109) "taxable supply'' means a supply of goods or services or both whichis leviable to tax underthis Act;

(110) "taxable territory" means the territory to whichthe provisions of this Act apply;

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(111) "telecommunication service" meansservice of any description (including electronic mail, voice mail, data services, audio text services, video text services, radio paging and cellular mobile telephone services) which is made available to users by means of any transmission or reception of signs, signals, writing, images and sounds or intelligence of any nature, by wire, radio, visual or other electromagnetic means;

(112) "turnover in State" means the aggregate value _ of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis) and exempt supplies made within a State by a taxable person, exports of goods or services or both and inter- State supplies of goods or services or both made from the State by the said taxable person but excludes central tax, State tax, Unionterritory tax, integrated tax and cess;

(113) "usual place of residence" means—

(a) in case of an individual, the place where he ordinarily resides;

(b) in other cases, the place where the person is incorporated or otherwise legally constituted;

(114) "Unionterritory" meanstheterritory of,-

(a) the Andaman and Nicobar Islands;

(b) Lakshadweep; .

(c) Dadra and Nagar Haveli; ~ (d) Daman and Diu;

(e) Chandigarh; and

(f) otherterritory; Explanation.- For the purposes ofthis Act, each of the territories specified in sub-clauses (a) to (f) shall be considered to be a separate Union territory.

(115) "Union territory tax" means the Union territory goods and services tax levied under the Union Territory Goods and Services Tax Act;

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(116) "Union Territory Goods and Services Tax Act" means the Union Territory Goods and Services Tax Act, 2017;

(117) "valid return" means a return furnished under sub-section (1) of section 39 on which self- assessed tax has been paidin full;

(118) "voucher" means an instrument where there is an obligation to accept it as consideration or part consideration for a supply of goods or services or both and where the goodsorservices or both to be supplied or the identities of their potential suppliers are either indicated on the instrument itself or in related documentation, including the terms and conditions ofuse of such instrument;

(119) "works contract" means a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract;

(120) words and expressions used and not defined in this Act but defined in the Integrated Goods and Services Tax Act, the Central Goods and Services Tax Act, the Union Territory Goods and Services Tax Act and the Goods and Services Tax (Compensation to States) Act shall have the same meaningsas assigned to them in those Acts.

CHAPTERII

ADMINISTRATION

3. The Government shall, by notification, appoint the following classes of officers for the purposes ofthis Act, namely:—

(a) CommissionerofState tax,

(b) Special Commissionersof State tax,

(c) Additional Commissioners of State tax,

(d) Joint Commissioners of State tax, aA

Officers under this Act.

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(e) Deputy Commissioners ofStatetax,

(f) Assistant Commissioners of State tax, and

(g) any other class ofofficers as it may deemfit:

Provided that, the officers appointed under the MadhyaPradesh Vat Act, 2002(No. 20 of 2002) shall be deemedto be the officers appointed under the provisions of this Act.

4. (1) The Government may,in additionto the officers as maybe notified under section 3, appoint such persons as it may think fit to be the officers underthis Act.

(2) The Commissioner shall have jurisdiction over the whole of the State, the Special Commissioner and an Additional Commissioner in respect of all or any of the functions assigned to them, shall have jurisdiction over the whole of the State or where the State Government so directs, over any local area thereof, and all other officers shall, subject to such conditions as may be specified, have jurisdiction over the whole of the State or over such local areas as the Commissioner may, by order, specify.

5. (1) Subject to such conditions and limitations as the Commissioner may impose, an officer of State tax may exercise the powers and discharge the duties conferred or imposed on him underthis Act.

(2) An officer of State tax may exercise the powers and discharge the duties conferred or imposed. under this Act on any other officer of State tax whois subordinate to him.

(3) The Commissioner may, subject to such conditions and limitations as may be specified in this behalf by him, delegate his powers to any other officer who is subordinate to him.

(4) Notwithstanding anything contained in __

this

section, an Appellate Authority shall not exercise the powers and discharge the duties conferred or imposed on any otherofficer of State tax.

528 (143)

Appointmentof officers. Powersofofficers.

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6. (1) Without prejudice to the provisions of this Act, the officers appointed under the Central Goods and Services Tax Act are authorised to be the proper officers for the purpdses of this Act, subject to such conditions as the Government shall, on the recommendations of the Council, by notification, specify.

(2) Subject to the conditions specified in the notification issued under sub-section (1),-

(a) where any properofficer issues an order under this Act, he shall also issue an order under the Central Goods and Services Tax Act, as authorised by the said Act under intimation to the jurisdictional officer of central tax;

(b) where a proper officer under the Central Goods and Services Tax Act has initiated any proceedings on a subject matter, no proceedings shall be initiated by the proper officer under this Act on the same subject matter.

(3) Any proceedings for rectification, appeal and revision, wherever applicable, of any order passed by an officer appointed under this Act, shall not lie before an officer appointed under the Central Goods and Services Tax Act. ,

CHAPTERIII

LEVY AND COLLECTION OF TAX

7. (1) For the purposes of this Act, the expression

"supply" includes—

(a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;

(b) import of services for a consideration whether or not in the course or furtherance of business;

(c) the activities specified in Schedule I, made or agreed to be made withouta consideration; and

(d) the activities to be treated as supply of goods or supply ofservices as referred to in ScheduleII. Authorisation of

officers of central tax as

properofficer in certain

circumstances.

Scope of supply.

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(2) Notwithstanding anything contained in sub-section (1),—

(a) activities or transactions specified in ScheduleIII; or

(b) such activities or transactions undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities, as may be notified by the Government on the recommendationsofthe Council,

shall be treated neither as a supply of goods nor a supply ofservices.

(3) Subject to the provisions of sub-sections (1) and (2), the Government may, on the recommendations of the Council, specify, by notification, the transactions that are to be treated as—

(a) a supply of goods and not as a supply ofservices; or

(b) a supply of services and not as a supply of goods.

8. The tax liability on a composite or a mixed supply shall be determined in the following manner, namely: —

(a) a composite supply comprising two or more supplies, one of which is a principal supply, shall be treated as a supply of such principal supply; and

(b) a mixed supply comprising two or more supplies shall be treated as a supply of that particular supply which attracts the highestrate oftax.

9. (1) Subject tothe provisions of sub-section (2), there shall be levied a tax called the Madhya Pradesh goods and services tax on all intra-State supplies of goods or services or both, exceptomthe supply of alcoholic liquor for human consumption, on the value determined under section 15 and at such rates, not exceeding twenty per cent., as may be notified by the Government on the recommendations of the Council and collected in such manner as may be prescribed and shal] be paid by the taxable person.

528 (145)

Taxliability on composite and mixed supplies.

Levy andcollection.

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528 (146) Heqges wstya, feaie 12 YA 2017

(2) The State tax on the supply of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel, shall be levied with effect from such date as may be notified by the Government on_ the recommendations of the Council.

(3) The Government may, on the recommendations of the Council, by notification, specify categories of supply of goods or services or both, the tax on which shall be paid on reverse charge basis by the recipient of such goodsorservices or both andall the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both.

(4) The State tax in respect of the supply of taxable goodsorservices or both by a supplier, whois not registered, to a registered person shall be paid by such person on reverse charge basis as_ the recipient and all the provisions of this Act shall apply to such recipientas if he is the person liable 'for paying the tax in relation to the supply of such goodsorservices or both.

(5) The Government may, on the recommendations of the Council, by notification, specify categories of services the tax on_intra-Statesupplies of which shall be paid by the electronic commerce operator if such services are supplied throughit, and all the provisions of this Act shall apply to such electronic commerce operator as if he is the supplier liable for paying the tax in relation to the supply of such services:

Provided that where an electronic commerce operator does not have a physical presence in the taxable territory, any person representing such electronic commerce operator for any purpose in the taxableterritory shall be liable to pay tax:

148

eae wera, feria 12 FA 2017 Provided further that where an_ electronic commerce operator does not have a physical presence in the taxable territory and also he does not have a representative in the said territory, such electronic commerce operator shall appoint a person in the taxable territory for the purpose of paying tax and such person shall be liable to pay tax. 10.(1) Notwithstanding anything to the contrary contained in this Act but subject to the provisions of sub-sections (3) and (4) of section 9, a registered person, whose aggregate turnover in the preceding financial year did not exceed fifty lakh rupees may opt to pay, in lieu of the tax payable by him, an amount calculated at such rate as may be prescribed, but not exceeding,-

(a) one per cent of the turnover in State in case of a manufacturer,

(b) two and a half per cent of the turnover in State in case of persons engaged in making supplies referred to in clause (b) of paragraph 6 of Schedule II, and .

(c) half per cent of the turnoverin State in case of other suppliers,

subject to such conditions and restrictions as may be prescribed:

Provided that the Government may, by notification, increase the said limit of fifty lakh rupees to such higher amount, not exceeding one crore rupees, as may be recommendedby the Council.

(2) The registered person shall be eligible to opt under sub-section (1), if—

(a) heis not engagedin the supply of services other than supplies referred to in clause (b) of paragraph 6 of Schedule IT;

(b) he is not engaged in making any supply of goods whichare not leviable to tax under this Act;

(c) he is not engaged in making any inter-State outward supplies of goods;

528 (147)

Composition levy.

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528 (148)

Reamer wera, feats^12A2017 43 of 1961

(d) he is not engaged in making any supply of goods through an electronic commerce operator who is required to collect tax at source under section 52; and

(e) he is not a manufacturer of such goods as may be notified by the Government on the recommendations of the Council:

Provided that where more than one registered person are having the same Permanent Account Number (issued under the Income-tax Act, 1961), the registered person shall not -be eligible to opt for the scheme undersub-section (1) unless all such registered personsoptto pay tax underthat sub-section.

(3) The option availed of by a registered person under sub-section (1) shall lapse with effect from the day on which his aggregate turnover during a financial year exceeds the limit specified under sub-section (1).

(4) A taxable person to whom the provisions of sub- section (1) apply shall not collect any tax from the recipient on supplies made by him norshall he be entitled to any credit of input tax.

(5) If the proper officer has reasons to believe that a

11.

taxable person has paid tax under sub-section (1) despite not being eligible, such person shall, in addition to any tax that may be payable by him under any other provisionsofthis Act, be liable to a penalty and the provisions of section 73 or section 74 shall, mutatis mutandis, apply for determination of tax and penalty.

(1) Where the Government is satisfied that it is necessary in.the public interest so to do, it may, on the recommendations of the Council, by notification, exempt generally, either absolutelyor subject to such conditions as may be specified therein, goods or services or both of any specified description from the whole or any part of the tax leviable thereon with effect from such date as may be specified in such notification.

Powerto grant

exemption from tax.

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(2) Where the Government is satisfied that it is necessary in the public interest so to do, it may, on the recommendations of the Council, by special order in each case, under circumstances of an exceptional nature to be stated in such order, exempt from paymentoftax any goods or services or both on whichtax is leviable.

(3) The Government may,if it considers necessary or expedient so to do for the purposeofclarifying the scope or applicability of any notification issued under sub-section (1) or order issued under sub- section (2), insert an explanation in such notification or order, as the case may be, by notification at any time within one year of issue of the notification under sub-section (1) or order under sub-section (2), and every such explanation shall have effect as if it had always been the part of the first such notification or order, as the case may be.

(4) Any notification issued by the Central Government, on the recommendations of the Council, under sub-section (1) of section 11 or order issued under sub-section (2) of the said section of the Central Goods and Services Tax Act shall be deemedto be a notification or, as the case may be, an order issued underthis Act. Explanation.—Forthe purposes ofthis section, where an exemption in respect of any goods or services or both from the whole orpart of the tax leviable thereon has been granted absolutely, the registered person supplying such goods or services or both shall not collect the. tax, in excess of the effective rate, on such supply of goods or

. services or both.

CHAPTERIV

TIME AND VALUEOF SUPPLY

528 (149)

12. (1) The liability to pay tax on goodsshall arise at the Time of supply of time of supply, as determined in accordance with the goods. provisionsofthis section.

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528 (150) Here Us, frie 12 YA 2017

(2) The time of supply of goods shall be the earlier of the following dates, namely:-

_ (a) the date of issue of invoice by the supplier or the last date on whichheis required, under sub-section

(1) of section 31, to issue the invoice with respect to the supply; or

(b) the date on which the supplier receives the paymentwith respect to the supply:

Provided that where the supplier of taxable goods receives an amount up to one thousand rupees in excess of the amount indicated in the tax invoice, the time of supply to the extent of such excess amount shall, at the option of the said supplier, be the date of issue of invoice in respect of such excess amount. Explanation 1.—For the purposes of clauses (a) and (b), "supply" shall be deemed to have been made to 'the extent it is covered by the invoice or, as the case maybe, the payment.

Explanation 2.—For the purposes of clause (b), "the date on which the supplier receives the payment"shall be the date on which the paymentis entered in his books of account or the date on which the paymentis credited to his bank account, whicheveris earlier.

(3) In case of supplies in respect of which tax is paid or liable to be paid on reverse charge basis, the time of supply shall be the earliest of the following dates, namely:—

(a) the date ofthe receipt of goods; or

(b) the date of payment as entered in the books of account of the recipient or the date on which the paymentis debited in his bank account, whichever is earlier; or

(c) the date immediately following thirty days from the date of issue of invoice or any other document, by whatever namecalled, in lieu thereof by the supplier:

152

Ae Usa, fee 12 YA 2017 Provided that where it is not possible to determine the time of supply under clause (a) or clause (b) or clause (c), the time of supply shall be the date of entry in the books of account ofthe recipient of supply.

(4) In case of supply of vouchers by a supplier, the time of supply shall be-

(a) the date of issue of voucher, if the supplyis identifiable at that point; or

(b) the date of redemption of voucher, in all other cases.

(5) Whereit is not possible to determine the time of supply under the provisions of sub-section (2) or | sub-section (3) or sub-section (4), the time of supply shall—

(a) in a case where a periodical return has to be filed, be the date on which suchreturn is to be filed; or

(b) in any other case, be the date on which the tax

"is paid.

(6) The time of supply to the extent it relates to an addition in the value of supply by wayofinterest, late fee or penalty for delayed payment of any consideration shall be the date on which the supplier receives such addition in value.

13. (1) The liability to pay tax on services shall arise at the time of supply, as determined in accordance with the provisions ofthis section..

(2) The time of supply ofservices shall be the earliest of the following dates, namely :—

(a) the date of issue of invoice by the supplier, if the invoice is issued within the period prescribed under ' sub-section (2) of section 31 or the date of receipt of payment, whicheveris earlier; or

(b) . the date of provision of service, if the invoice is not issued within the period prescribed under sub- section (2) of section 31 or the date of receipt of payment, whicheveris earlier; or

528 (151)

Time of supply of services.

153

528 (152) Hee wstaa, faa 12 VA 2017 (c)the date on which the recipient shows the receipt of services in his books of account, in a case where the provisionsofclause (a) or clause (b) do notapply:

Provided that where the supplier of taxable service receives an amount upto one thousand rupees in excess of the amount indicated in the tax invoice, the time of supply to the extent of such excess amountshall, at the option of the said supplier, be the date of issue of"

invoice relating to such excess amount. Explanation.—Forthe purposes of clauses (a) and (b)-

(i) the supply shall be deemed to have been made to the extent it is covered by the invoice or, as the case maybe, the payment;

(ii) "the date of receipt of payment" shall bethe date on which the paymentis entered in the books of account of the supplier or the date on which the payment is credited to his bank account, whicheveris earlier.

(3) In case of supplies in respect of which tax is paid or liable to be paid on reverse charge basis, the time of supply shall be the earlier of the following dates, namely:—

(a) the date of payment as entered in the books of account of the recipient or the date on which the payment is debited in his bank account, whicheveris earlier; or

(b) the date immediately following sixty days from the date of issue of invoice or any other document, by whatever namecalled,in lieu thereof by the supplier:

Provided that whereit is not possible to determine the time of supply under clause (a) or clause (b), the time of | supply shall be the date of entry in the books of account of the recipient of supply:

Provided further that in case of supply by associated . enterprises, where the supplier of service is located outside India, the time of supply shall be the date of entry in the books of account of the recipient of supply or the date of payment, whicheverisearlier.

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AeaIe Usa, feiss 12 YA 2017

(4) In case of supply of vouchers by a supplier, the time of supply shall be—

(a) the date of issue of voucher, if the supply is identifiable at that point; or

(b) the date of redemption of voucher, in all other cases.

(5) Whereit is not possible to determine the time of supply under the provisions of sub-section (2) or sub-section (3) or sub-section (4), the time of supply shall—

(a) in a case where a periodical return has to be filed, be the date on which suchreturn is to be filed; or

(b) in any other case, be the date on which the tax is paid.

(6) The time of supply to the extent it relates to an addition in the value of supply by wayofinterest, late fee or penalty for delayed payment of any consideration shall be the date on which the supplier receives such addition in value.

14. Notwithstanding anything contained in section 12 or section 13, the time of supply, where there is a change in the rate of tax in respect of goods or services or both, shall be determined in the following manner, namely:—

(a) in case the goods or services or both have been supplied before the change in rate of tax,—

(i) where the invoice for the same has been issued and the paymentis also received after the changeinrate oftax, the time of supply shail be the date of receipt of payment or the date of issue of invoice, whicheveris earlier; or

(ii) where the invoice has been issued prior to the change in rate of tax but payment is received after the change in rate of tax, the time of supply shall be the date of issue of invoice; or

528 (153)

Changein rate of tax in respect of supply of goodsorservices.

155

528 (154) ^AHIUTA,fears^12AA2017

(iii) where the payment has been received before the change in rate of tax, but the invoice for the same is issued after the change in rate oftax, the time of supply shall be the date of receipt of payment;

(b) in case the goodsor services or both have been supplied after the change in rate of tax,—

(i) where the payment is received after the change in rate of tax but the invoice has been issued prior to the change in rate of tax, the time of supply shall be the date of receipt of payment; or

(ii) where the invoice has been issued and payment is received before the change in rate of tax, the time of supply shall be the date of receipt of paymentor date of issue of invoice, whicheveris earlier; or

(iii) where the invoice has beenissued after the change in rate of tax but the paymentis received before the changein rate oftax, the time of supply shall be the date of issue of invoice:

Provided that the date of receipt of paymentshall be the date of credit in the bank accountif such credit in the bank account is after four working days from the date of changein the rate of tax.

Explanation.—For the purposes of this section, "the date of receipt of payment"shall be the date on whichthe paymentis entered in the books of account ofthe supplier or the date on which the paymentis credited to his bank account, whicheveris earlier.

15. (1) The value of a supply of goods or services or both shall be the transaction. value, which is the price actually paid or payable for the said supply of goods or services or both where the supplier and the recipient of the supply are not related and theprice is the sole consideration for the supply.

(2) The value of supply shall include— Value of taxable

supply.

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(a) any taxes, duties, cesses, fees and charges levied under any law for the time being in force other than this Act, the Central Goods and Services Tax Act and the Goods and Services Tax (Compensation to States) Act, if charged separately by the supplier;

(b) any amount that the supplier is liable to pay in relation to such supply but which has been incurred by the recipient of the supply and not included in the price actually paid or payable for the goods or services or both;

(c) incidental expenses, including commission and packing, charged by the supplier to the recipient of a supply and anyamount charged for anything done by the supplier in respect of the supply of goods or services or bothat the time of, or before delivery of goods or supply of services;

(d) interest or late fee or penalty for delayed paymentofany consideration for any supply; and

(e) subsidies directly linked to the price excluding subsidies provided by the Central Government and State Governments.

Explanation.—For the purposes of this sub-section, the amount of subsidy shall be includedin the value of supply of the supplier who receives the subsidy.

(3) The value of the supply shall not include any discount which is given—

(a) before or at the time of the supply if such discount has been duly recorded in the invoice issued in respect of such supply; and

(b) after the supply has been effected,if -

(i) such discount is established in terms of an agreemententeredinto at or before the time of such supply and specifically linked to relevant invoices, and

528 (155)

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528 (156) AeagIeN watTA, Fae 12 FA 2017

(ii) input tax credit as is attributable to the discount on the basis of document issued by the supplier has been reversed by the recipient of the supply.

(4) Where the value of the supply of goods or services or both cannot be determined under sub-section (1), the same shall be determined in such manner as maybe prescribed.

(5) Notwithstanding anything contained in sub- section (1) or sub-section (4), the value of such supplies as may be notified by the Government on the recommendations of the Council shall be determined in such manneras maybeprescribed. Explanation.- For the purposes of this Act,-

(a) persons shall be deemedto be "related persons'"' if -

(i) such persons are officers or directors of one another's businesses;

(ii) such persons are legally recognised partners in business;

(iii) such persons are employer and employee;

(iv) any person directly or indirectly owns, controls or holds twenty-five per cent. or more of the outstanding voting stock or shares of both ofthem;

(v) one of them directly or indirectly controls the other;

(vi) both of them are directly or indirectly controlled by a third person;

(vii) together they directly or indirectly control a third person; or

(viii) _they are members of the same family;

(b) the term "person"also includeslegal persons.

(c) persons who are associated in the business of one another in that one is the sole agent or sole distributor or sole concessionaire, howsoever described, of the other, shall be deemedto berelated.

158

eager usta, fetish 12 YA 2017 528 (157)

CHAPTER V

INPUT TAX CREDIT

16.(1) Every registered person shall, subject to such Eligibility and conditions and restrictions as may be prescribed and conditions for taking in the manner specified in section 49, be entitled to input tax credit. take credit of input tax charged on any supply of

goods or services or both to him which are used or

intended to be used in the course or furtherance ofhis business and the said amountshall be credited to the electronic credit ledger of such person.

(2) Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goodsor services or both to him unless,—

(a) he is in possession ofa tax invoice or debit note _ issued by a supplier registered under this Act, or such other tax paying documents as maybeprescribed;

(b) he has received the goodsorservices or both. Explanation—For the purposes of this clause, it shall be deemed that the registered person has received the goods where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documentsoftitle to goods or otherwise;

(c) subject to the provisions of section 41, the tax charged in respect of such supply has been actually paid to the Government, either in cash or through utilisation of input tax credit admissible in respect of the said supply; and

(d) he has furnished the returnundersection 39:

Provided that where the goods against an invoice are received in lots or instalments, the registered person shall be entitled to take credit upon receipt of the last lot or instalment:

159

528

(

(158)

43 of 1961. Reape asa, feat 12 FA 2017 Provided further that where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the amount towards the value ofsupply along with tax payable thereon within a period of one hundred and eighty days from the date of issue of invoice by the supplier, an amount equal to the input tax credit availed by the recipient shall be added to his outputtax liability, along with interest thereon, in such manneras maybeprescribed:

Provided also that the recipient shall be entitled to avail of the credit of input tax on payment made by him of the amount towards the value of supply of goods or services or both along with tax .payable thereon.

(3) Where the registered person has claimed depreciation on the tax componentof the cost of capital goods and plant and machinery under the provisions of the Income-tax Act, 1961, the input tax credit on the said tax componentshall not be allowed.

(4) A registered person shall not be entitled to take

17,

input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or invoice relating to such debit note pertains or furnishing of the relevant annual return, whicheveris earlier.

(1) Where the goodsor services or both are used by the registered person partly for the purpose of any business and partly for other purposes, the amount of credit shall be restricted to so much ofthe input tax as is attributable to the purposesof his business.

(2) Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be Apportionment of

credit and blocked

credits.

HAIN wT, feat 12 FA 2017 restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies.

(3) The value of exempt supply under sub-section (2) shall be such as may be prescribed, and shall include supplies on which the recipient is liable to pay tax on reverse charge basis, transactions. in securities, sale of land and, subject to clause (b) of paragraph 5 of ScheduleII, sale of building. (4)A banking company or afinancial institution including a non-banking financial company, engaged in supplying services by way of accepting deposits, extending loans or advances shall have the option to either comply with the provisions of sub-section (2), or avail of, every month, an amount equal to fifty per cent of the eligible input tax credit on inputs, capital goods and input services in that month and the rest shall lapse:

Provided that the option once exercised shall not be withdrawn during the remainingpart ofthe financial year:

Provided further that the restriction of fifty per cent shall not apply to the tax paid on supplies made by one registered person to another registered person having the same Permanent Account Number.

(5) Notwithstanding anything contained in sub- section (1) of section 16 and sub-section (1) of section 18; input tax credit shall not be available in respect of the following, namely:-

(a) motor vehicles and other conveyances except whenthey are used—

(i) for making the following taxable supplies, namely:—

(A) further supply of such vehicles or conveyances; or

(B) transportation of passengers; or

528 (159)

161

528 (160) Hee weatra, feat 12 FA 2017

(C) imparting training on driving, flying, navigating such vehicles or conveyances;

(ii) for transportation of goods;

(b) the following supply of goods or services or both:-

(i) food and beverages, outdoor catering, beauty treatment, health services, cosmetic and plastic surgery except where an inward supply of goodsorservices or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply;

' Gi) membership of a club, health and fitness centre;

(iti) rent-a-cab, life insurance and health insurance except where-

(A) the Governmentnotifies the services which are obligatory for an employer to provide to its employees under any law for the time being in force;or .

(B) such inward supply of goods or services or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as part of a taxable composite or mixed supply; and

(iv) travel benefits extended to employees on vacation such as leave or hometravel concession.

(c) works contract services when supplied for construction of an immovable property (other than plant and machinery) except where it is an input service for further supply of works contract service;

(d) goods or services or both received by a taxable person for construction of an immovable property (other than plant or machinery) on his own account including when such goodsorservices or both are used in the course or furtherance of business.

162

Ree Usa, frie 12 YA 2017 Explanation.—For the purposes of clauses (c) and (d), the expression "construction" includes re- construction, renovation, additions or alterations or repairs, to the extent of capitalisation, to the said immovable property;

(e) goods or services or both on which tax has been paid undersection 10;

(f) goods or services or both received by a non- resident taxable person except on goods imported by him;

(g) goods orservices or both used for personal consumption;

(h) goods lost, stolen, destroyed, written off or disposed of by wayofgift or free samples; and

(i) any tax paid in accordance with the provisions of sections 74, 129 and 130.

(6) The Government may prescribe the manner in which the credit referred to in sub-sections (1) and

(2) maybeattributed. Explanation.— For the purposes of this Chapter and Chapter VI, the expression "plant and machinery" means apparatus, equipment, and machinery fixed to earth by foundation or structural support that are used for making outward supply of goods or services or both and includes such foundation and structural supports but excludes-

(i) land, building or any othercivil structures;

(ii) telecommunication towers; and

(iii) pipelines laid outside the factory premises.

18. (1) Subject to such conditions andrestrictions as may be prescribed—

(a) a person whohasapplied for registration under this Act within thirty days from the date on which he - becomes liable to registration and has been granted such registration shall be entitled to take credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the day immediately preceding the date from

528 (161)

Availability ofcredit in _special circumstances.

163

528 (162) ^{FEAUTI,fea12FA2017} which he becomes liable to pay tax under the provisionsofthis Act;

(b) a person who takes registration under sub- section (3) of section 25 shall be entitled to take credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the day immediately preceding the date of grant of registration;

(c) where any registered person ceases to pay tax under section 10, he shall be entitled to take credit of input tax in respect of inputs held in stock, inputs contained in semi-finished or finished goods held in Stock and on capital goods on the day immediately preceding the date from which he becomesliable to pay tax undersection 9:

Provided that the credit on capital goods shall be reduced by such percentage points as may be prescribed;

(d) where an exempt supply of goods or services or both by a registered person becomesa taxable supply, such person shall be entitled to take credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock relatable to such exempt supply and on capital goods exclusively used for such exempt supply on the day immediately preceding the date from which such supply becomestaxable:

Provided that the credit on capital goods shall be reduced by such percentage points as may be prescribed.

(2) A registered person shall not be entitled to take input tax credit under sub-section (1) in respect of any supply of goods or services or both to him after the expiry of one year from the date of issue of tax invoice relating to such supply.

(3) Where there is a change in the constitution of a registered person on account of sale, merger, demerger, amalgamation, lease or transfer of the business with the specific provisions for transfer of liabilities, the said registered person shall be allowed to transfer the input tax credit which remains unutilised in his electronic credit ledger to

164

ewe wera, fete 12 FA 2017 528 (163) such sold, merged, demerged, amalgamated, leased or transferred business in such manner as may be prescribed.

(4) Where any registered person who hasavailed of input tax credit opts to pay tax under section 10 or, where the goods or services or both supplied by him become wholly exempt, he shall pay an amount, by way of debit in the electronic credit ledger or electronic cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock and on capital goods, reduced by such percentage points as may be prescribed, on the day immediately preceding the date of exercising of such option or, as the case may be, the date of such exemption:

Provided that after payment of such amount, the balance of input tax credit, if any, lying in his electronic credit ledger shall lapse.

(5) The amount of credit under sub-section (1) and the amount payable under sub-section (4) shall be calculated in such.manner as may beprescribed.

(6) In case of supply of capital goods or plant and machinery, on which input tax credit has been taken, the registered person shall pay an amount equal to the input tax credit taken on the said capital goods or plant and machinery reduced by such percentage points as may be prescribed or the tax on the transaction value of such capital goods or plant and machinery determined under section15, whicheveris higher:

Provided that where refractory bricks, moulds and dies, jigs and fixtures are supplied as scrap, the taxable person maypaytax onthe transaction value of such goods determined undersection 15.

19. (1) The principal shall, subject to such conditions and Taking inputtax credit restrictions as may be prescribed, be allowed input tax in respect of inputs and credit on inputs sent to a job workerforjob work. capital goods sent for job work.

165

528 (164) Reger uss, feat 12 FA 2017

(2) Notwithstanding anything contained in clause (b) of sub-section (2) of section 16, the principal shall be entitled to take credit of input tax on inputs evenif the inputs are directly sent to a job worker for job work without being first brought to his place of business.

(3) Where the inputs sent for job work are not received back bythe principal after completion of job work or otherwise or are not supplied from the place of business of the job worker in accordance with clause (a) or clause (b) of sub-section (1) of section 143 within one year of being sent out, it shall be deemed that such inputs had been supplied by the principal to the job worker on the day whenthe said inputs were sent out:

Provided that where the inputs are sent directly to a job worker, the period of one year shall be counted from the date of receipt of inputs by the job worker.

(4) The principal shall, subject to such conditions and restrictions as may be prescribed, be allowed input tax credit on capital goods sent to a job worker for job work.

(5) Notwithstanding anything contained in clause (b) of sub-section (2) of section 16, the principal shall be entitled to take credit of input tax on capital goodsevenifthe capital goodsare directly sent to a job worker for job work without being first broughtto his place of business.

(6) Where the capital goods sent for job work are not received back by the principal within a period of three years of being sent out, it shall be deemed that such capital goods had been supplied by the principal to the job worker on the day when the said capital goods were sent out:

Provided that where the capital goods are sent directly to a job worker,the period of three years shall be counted from the date of receipt of capital goods by the job worker.

166

Fegges wera, fea 12 FA 2017 528 (165)

(7) Nothing contained in sub-section (3) or sub- section (6) shall apply to mouldsanddies, jigs and fixtures, or tools sent out to a job worker for job work.

Explanation.- For the purpose of this section,

"principal" means the person referred to in section

143.

20. (1) The Input Service Distributor shall distribute the Manner ofdistribution credit of State tax as State tax or integrated tax and ofcredit by Input integrated tax as integrated tax or State tax, by way of Service Distributor. issue of document containing the amount of input tax

credit being distributed in such manner as may be

prescribed.

(2) The Input Service Distributor may distribute the credit subject to the following conditions, namely:—

(a) the credit can be distributed to the recipients of credit against a document containing such details as maybeprescribed;

(b) the amount of the credit distributed shall not exceed the amountofcredit available for distribution;

(c) the credit of tax paid on input services attributable to a recipient of credit shall be distributed only to that recipient;

(d) the credit of tax paid on input services attributable to more than one recipient of credit shall be distributed amongst such recipients to whom the input service is attributable and such distribution shall be pro rata on the basis of the turnoverin a State or turnover in a Unionterritory of such recipient, during the relevantperiod, to the aggregate of the turnover of all such recipients to whom such input service is attributable and which are operational in the current - year, duringthe said relevant period;

(e) the credit of tax paid on input services attributable to all recipients of credit shall be distributed amongst such recipients and such distribution shall be pro rata on the basis of the

167

528 (166) ^{FeeUTA,fear12FA2017} turnover in a State or turnover in a Unionterritory of such recipient, during the relevant period, to the aggregate of the turnover of all recipients and which are operational in the current year, during the said relevant period.

Explanation.—Forthe purposesofthis section,—

(a) the "relevant period" shall be—

(i) if the recipients of credit have turnover in their States or Union territories in the financial year preceding the year during which credit is to be distributed, the said financial year; or

(ii) if someorall recipients of the credit do not have any turnoverin their States or Union territories in the financial year preceding the year during whichthecredit is to be distributed, the last quarter for which details of such turnover of all the recipients are available, previous to the month during whichcredit is to be distributed;

(b) the expression "recipient of credit" means the supplier of goods or services or both having the same Permanent Account Numberas that of the Input Service Distributor;

(c) the term "turnover", in relation to any registered person engaged in the supply of taxable goods as well as goods not taxable under this Act, means the value of turnover, reduced by the amount of any duty or tax levied under entry 84 of List I of the Seventh Schedule to the Constitution and entry 51 and 54 ofList II ofthe said Schedule. 21, Where the Input Service Distributor distributes the credit in contravention of the provisions contained in section 20 resulting in excess distribution of credit to one or morerecipients of credit, the excess credit so distributed shall be recovered from such recipients along with interest, and the provisions of section 73 or section 74, as the case may be, shall, mutatis mutandis, apply for determination of amount to be recovered.

Mannerofrecovery of

credit distributed in

excess.

168

eI UsTA, fai 12 FA 2017

CHAPTER VI

REGISTRATION

528 (167)

22. (1) Every supplier making a taxable supply of goods Personsliable for or services or both in the State shall be liable to be registration. registered under this Act if his aggregate turnover in a financial year exceeds twenty lakh rupees:

Provided that where such person makes taxable

supplies of goods or services or both from any of the special category States, he shall be liable to be registered if his aggregate turnover in a financial year exceeds ten lakh rupees.

(2) Every person who, on the day immediately preceding the appointed day, is registered or holds a license under an existing law, shall be liable to be registered under this Act with effect from the appointed day.

(3) Where a business carried on by a taxable person registered under this Act is transferred, whether on account of succession or otherwise, to another person as a going concern, the transferee or the successor, as the case may be, shall be liable to be registered with effect from the date of such transfer or succession.

(4) Notwithstanding anything contained in sub- sections (1) and (3), in a case of transfer pursuant to sanction of a scheme or an arrangement for amalgamation or, as the case may be, de-merger of two or more companies pursuant to an order of a High Court, Tribunal or otherwise, the transferee shall be liable to be registered, with effect from the date on which the Registrar of Companies issues a certificate of incorporation giving effect to such order of the High Court or Tribunal. Explanation.—Forthe purposesofthis section,—

(i) the expression "aggregate turnover" shall include all supplies made by the taxable person, whether on his own account or made on behalfofall his principals;

(ii) the supply of goods, after completion of job work, by a registered job worker shall be treated as the supply of

169

528 (168) Feagey wera, feat 12 FA 2017 goods by the principal referred to in section 143, and the value of such goodsshall not be included in the aggregate turnoverofthe registered jobworker,;

(iii) the expression "special category States" shall mean the States as specified in sub-clause (g) of clause (4) of article 279A of the Constitution.

23.(1) The following persons shall not be liable to Persons notliable for registration, namely:— registration.

(a) any person engaged exclusively in the business of supplying goodsor services or both that are notliable to tax or wholly exempt from tax under this Act or under the Integrated Goods and Services Tax Act;

(b) an agriculturist, to the extent of supply of produce out of cultivation of land.

(2) The Government may, on the recommendations of the Council, by notification, specify the category of persons who may be exempted from obtaining registration underthis Act.

24. Notwithstanding anything contained in sub-section (1) Compulsory of section 22, the following categories of persons shall registration in certain be required to be registered under this Act,- cases.

(i) persons making any inter-State taxable supply;

(ii) casual taxable persons making taxable supply;

(iii) persons who are required to pay tax under reverse charge; ,

(iv) person who are required to pay tax under sub-section

(5) of section 9;

(v) non-resident taxable persons making taxable supply;

(vi) persons who are required to deduct tax under section 51, whether or not separately registered under this Act;

(vii) persons who make taxable supply of goods or services or both on behalf of other taxable persons whetheras an agent or otherwise;

(viii) Input Service Distributor, whether or not separately registered underthis Act;

(ix) persons who supply goodsor services or both, other than supplies specified under sub-section (5) of section 9,

170

Hee UsT, fee 12 YA 2017 through such electronic commerce operator who is required to collect tax at source under section 52;

(x) every electronic commerceoperator;

(xi) every person supplying online information and data base accessorretrieval services from a place outside India to a person in India, other than a registered person; and

(xii) such other person or class of persons as may be notified by the Government on the recommendations of . the Council.

25. (1) Every person whois liable to be registered under section 22 or section 24 shall apply for registration within thirty days from the date on which he becomes liable to registration, in such manner and subject to such conditions as may be prescribed:

Provided that a casual taxable person or a non-resident taxable person shall apply for registration at least five days prior to the commencementofbusiness. Explanation.- Every person who makes a supply from the territorial waters of India shall obtain registration in the State where the nearest point of the appropriate baselineis located.

. (2) A person seeking registration under this Act shall be granted a single registration:

Provided that a person having multiple business verticals in the State may be granted a separate registration for each business vertical, subject to such conditions as may be prescribed.

(3) A person, though notliable to be registered under section 22 or section 24 may get himself registered voluntarily, and all provisions of this Act, as are applicable to a registered person, shall apply to such person.

(4) A person whohasobtainedoris required to obtain more than oneregistration, whether in one State or Union territory or more than one State or Union territory shall, in respect of each such registration, be treated as distinct persons for the purposes of this Act.

Procedure for

registration.

528 (169)

171

528 (170)

43.of 1961. 46 of 1947. Heage wera, feat 12 A 2017

(5) Where a person whohasobtained oris required to obtain registration in a State or Unionterritory in respect of an establishment, has an establishment. in another State or Union territory, then such establishments shall be treated as establishments of distinct persons for the purposesofthis Act.

(6) Every person shall have a Permanent Account Numberissued under the Income-tax Act, 1961 in order to be eligible for grant of registration:

Provided that a person required to deduct tax under section 51 may have, in lieu of a Permanent Account Number, a Tax Deduction and Collection Account Number issued under the said Act in order to be eligible for grant ofregistration.

(7) Notwithstanding anything contained in sub- section (6), a non-resident taxable person may be granted registration under sub-section (1) on the basis of such other documents as may be prescribed.

(8) Where a person who is liable to be registered under this Act fails to obtain registration, the proper officer may, without prejudice to any action which may betaken under this Act or under any other law for the time being in force, proceed to register such person in such manner as may be prescribed.

(9) Notwithstanding anything contained in sub- section (1),—

(a) any specialised agency of the United Nations Organisation or any Multilateral Financial Institution and Organisation notified under the United Nations (Privileges and Immunities) Act, 1947, Consulate or Embassyof foreign countries; and

(b) any other person or class of persons, as may be notified by the Commissioner,

shall be granted a Unique Identity Number in such manner and for such purposes, including refund of taxes on the notified supplies of goods or services or. both received by them, as maybe prescribed.

172

Feagge wsrsa, fetie 12 FA 2017 528 (171)

(10) The registration or the Unique Identity Number shall be granted or rejected after due verification in such manner and within such period as may be prescribed.

(11) A certificate of registration shall be issued in such form and with effect from such date as may be prescribed.

(12) A registration or a Unique Identity Number shall be deemed to have been granted after the expiry of the period prescribed under sub-section (10), if no deficiency has been communicated to the applicant within that period.

26.(1) The grant of registration or the Unique Identity Number under the Central Goods and Services Tax Act shall be deemedto be a grantofregistration or the Unique Identity Number under this Act subject to the condition that the application for registration or the Unique Identity Number has not been rejected under this Act within the time specified in sub-section (10) of section 25. _ ,

(2) Notwithstanding anything contained in sub- section (10) of section 25, any rejection of application for registration or the Unique Identity Number under the Central Goods and Services Tax Act shall be deemed to be a rejection of application for registration under this Act.

27. (1) The certificate of registration issued to a casual taxable person or a non-resident taxable person shall be valid for the period specified in the application for registration or ninety days from the effective date of registration, whicheveris earlier and such person shall - make taxable supplies only after the issuance of the certificate of registration:

Provided that the proper officer may, on sufficient cause being shown bythesaid taxable person, extend the said period of ninety days by a further period not exceeding ninety days.

(2) A casual taxable person or a non-resident taxable person shall, at the time of submission of Deemedregistration.

Special provisions

relating to casual

taxable person and non-

resident taxable person.

173

528 (172) eae UTA, fers 12 VA 2017 application for registration under sub-section (1) of section 25, make an advance deposit of tax in an amount equivalent to the estimated tax liability of such person for the period for which the registration is sought:

Provided that where any extension of time is sought -under sub-section (1), such taxable person shall deposit an additional amount of tax equivalent to the estimated tax liability of such person for the period for which the extension is sought.

(3) The amount deposited under sub-section (2) shall be credited to the electronic cash ledger of such person and shall be utilised in the manner provided undersection 49.

28. (1) Every registered person and a person to whom a Amendment of Unique Identity Number has been assigned shall registration. inform the proper officer of any changes in' the information furnished at the time of registration or subsequent thereto, in such form and manner and within such period as maybe prescribed.

(2) The proper officer may, on the basis of information furnished under sub-section (1) or as ascertained by him, approve or reject amendments in the registration particulars in such manner and within such period as maybe prescribed:

Provided that approval of the proper officer shall not be required in respect of amendment of such particulars as may be prescribed:

Provided further that the proper officer shall not reject the application for amendment in the registration particulars without giving the person an opportunity of being heard.

(3) Any rejection or approval of amendments under the Central Goods and Services Tax Act shall be deemed to be a rejection or approval under this Act.

29. (1) The proper officer may, either on his own motion Cancellation of or on an application filed by the registered person or registration.

174

Heager usraa, feat 12 FA 2017 528 (173) by his legal heirs, in case of death of such person, cancel the registration, in such manner and within such period as may be prescribed, having regard to the circumstances where,—

(a) the business has been discontinued, transferred fully for any reason including death of the proprietor, amalgamated with other legal entity, demerged or otherwise disposedof; or

(b) there is any change in the constitution of the business; or

(c) the taxable person, other than the person registered under sub-section (3) of section 25, is no longer liable to be registered under section 22 or section 24.

(2) The proper officer may cancel the registration of a person from such date, including any retrospective date, as he may deem fit, where,—

(a) a registered person has contravened such provisions of the Act or the rules made thereunder as maybeprescribed; or

(b) a person paying tax under section 10 has not furnished returns for three consecutive tax periods; or

(c) any registered person, other than a person specified in clause (b), has not furnished returns for a continuousperiod of six months; or

(d) any person whohas taken voluntary registration under sub-section (3) of section 25 has not commenced business within six months from the date of registration; or

(e) registration has been obtained by means of fraud, wilful misstatement or suppression offacts:

Provided that the proper officer shall not cancel the registration without giving the person an opportunity of being heard.

175

528 (174) eager wes, feat 12 FA 2017

(3) The cancellation of registration under this section shall not affect the liability of the person to pay tax and other dues under this Act or to discharge any obligation under this Act or the rules made thereunder for any period prior to the date of cancellation whether or not such tax and other dues are determined before or after the date of cancellation.

(4) The cancellation of registration under the Central Goods and Services Tax Act shall be deemed to be a cancellation of registration underthis Act.

(5) Every registered person whose registration is cancelled shall pay an amount, by way of debit in- the electronic credit ledger or electronic cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs | contained in semi-finished or finished goods held in stock or capital goods or plant and machinery on the day immediately preceding the date of such cancellation or the output tax payable on such goods, whichever is higher, calculated in such manneras maybeprescribed:

Provided that in case of capital goods or plant and machinery, the taxable person shall pay an amount equal to the input tax credit taken on the said capital goods or plant and machinery, reduced by such percentage points as may be prescribedorthe tax on the transaction value of such capital goods or plant and machinery under section 15, whicheveris higher.

(6) The amount payable under sub-section (5) shall be calculated in such manneras maybeprescribed.

30. (1) Subject to such conditions as may be prescribed, Revocation of any registered person, whoseregistration is cancelled cancellation of by the proper officer on his own motion, may apply to registration. such officer for revocation of cancellation of the registration in the prescribed manner within thirty days from thedate ofservice of the cancellation order.

(2) The proper officer may, in such manner and within such period as may be prescribed, by order,

176

Hee watts, fei 12 A 2017 ⁵²⁸(175) either revoke cancellation of the registration or reject the application:

Provided that the application for revocation of cancellation of registration shall not be rejected unless the _applicant has been given an opportunity of being heard.

(3) The revocation of cancellation of registration under the Central Goods and Services Tax Act shall be deemed to be a revocation of cancellation of registration under this Act.

CHAPTERVII

TAX INVOICE, CREDIT AND DEBIT NOTES

31. (1) A registered person supplying taxablegoodsshall, before orat the time of-

(a) removal of goods for supply to the recipient, where the supply involves movementofgoods; or

(b) delivery of goods or making available thereof to the recipient, in any other case, issue a tax invoice showing the description, quantity and value of goods, the tax charged thereon and such other particulars as may be prescribed:

Provided that the Government may, on_ the recommendations of the Council, by notification, specify the categories of goods or supplies in respect of which a tax invoice shall be issued, within such time and in such manner as may be prescribed.

(2) A registered person supplying taxable services shall, before or after the provision of service but within a prescribed period, issue a tax invoice, showing the description, value, tax charged thereon and such other particulars as may be prescribed:

Provided that the Government may, on the recommendations of the Council, by notification and subject to such conditions as may be mentioned therein, specify the categories of services in respect of which— Tax invoice.

177

528 (176) HeAIe UAT, Pea 12 YA 2017

(a) any other document issued in relation to the supply shall be deemedto be a tax invoice; or

(b) tax invoice may not be issued.

(3) Notwithstanding anything contained in sub- sections (1) and (2)}—

(a) a registered person may, within one month from the date of issuanceofcertificate of registration and in such manner as may be prescribed, issue a revised invoice against the invoice already issued during the period beginning with the effective date of registration till the date of issuance of certificate of registration to him;

(b) a registered person may notissue a tax invoice if the value of the goods or services or both supplied is less than two hundred rupees subject to such conditions and in such manneras may be prescribed;

(c) a registered person supplying exempted goods or services or both or paying tax under the provisions of section 10 shall issue, instead of a tax invoice,a bill of supply containing such particulars and in such manner as maybeprescribed:

Provided that the registered person may not issue a bill of supply if the value of the goods or services or both supplied is less than two hundred rupees subject to such conditions and in such manner as may be prescribed;

(d) a registered person shall, on receipt of advance payment with respect to any supply of goods or services or both, issue a receipt voucher or any other document, containing such particulars as may be prescribed, evidencing receipt of such payment,

(e) where, on receipt of advance payment with respect to any supply of goodsor services or both the registered person issues a receipt voucher, but subsequently no supply is made and no tax invoice is issued in pursuance thereof, the said registered person may issue to the person who. had made the payment, a refund voucher against such payment,

178

Heer Usa, fetta 12 YA 2017

528 (177)

(f) a registered person who is liable to pay tax under sub-section (3) or sub-section (4) of section 9 shall issue an invoice in respect of goods or services or both received by him from the supplier who is not registered on the date ofreceipt of goods or services or both;

(g) a registered person whoisliable to pay tax under sub- section (3) or sub-section (4) of section 9 shall issue a payment voucher at the time of making payment to the supplier.

(4)In case of continuous supply of goods, where successive statements of accounts or successive payments are involved,the invoice shall be issued before or at the time each such statementis issued or, as the case may be, each such payment is received.

(5) Subject to the provisions of clause (d) of sub- section (3), in case of continuous supply of services,—

(a) where the due date of paymentis ascertainable from the contract, the invoice shall be issued on or before the due date ofpayment,

(b) where the due date of payment is not ascertainable from the contract, the invoice shall be issued before or at the time when the supplier of service receives the payment,

(c) where the paymentis linked to the completion of an event, the invoice shall be issued on or before the date of completion of that event.

(6) In a case where the supply of services ceases under a contract before the completion of the supply, the invoice shall be issued at the time whenthe supply ceases and such invoice shall be issued to the extent of the supply made before such cessation.

(7) Notwithstanding anything contained in sub- section (1), where the goods being sent or taken on approval for sale or return are removed before the supply takes place, the invoice shall be issued before or at the time of supply or six months from the date of removal, whicheveris earlier.

179

528 (178) Heqggmey wera, fete 12 SA 2017 Explanation.—For the purposes of this section, the expression "tax invoice"shall include any revised invoice issued by the supplier in respect of a supply madeearlier.

32. (1) A person whois not a registered person shall not collect in respect of any supply of goodsorservices or both any amount by way oftax under this Act.

(2) No registered person shall collect tax except in

33.

34.

accordance with the provisions of this Act or the rules made thereunder.

Notwithstanding anything contained in this Act or any other law for the time being in force, where any supply is made for a consideration, every person who is liable to pay tax for such supply shall prominently indicate in all documents relating to assessment, tax invoice and other like documents, the amount of tax which shall form part of the price at which such supply is made.

(1) Where a tax invoice has been issued for supply of any goodsor services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goodsor services or both, may issue to the recipient a credit note containing such particulars as may be prescribed.

(2) Any registered person whoissues a credit note in relation to a supply of goods or services or both shall declare the details of such credit note in the return for the month during which suchcredit note has been issued but not later than September following the end ofthe financial year in which such supply was made,or the date of furnishing of the relevant annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as may beprescribed:

Provided that no reduction in output tax liability of the supplier shall be permitted, if the incidence of tax and interest on such supply has been passed on to any other person.

Prohibition of

unauthorised collection —

of tax

Amount of tax to be

indicated in tax invoice

and other documents.

Credit and debit notes.

180

Heme usta, fel 12 YA 2017 528 (179)

(3) Where a tax invoice has been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to be less than the taxable value or tax payable in respect of such supply, the registered person, who has supplied such goodsorservices or both, shall issue to the recipient a debit note containing such particulars as may be prescribed.

(4) Any registered person whoissues a debit note in relation to a supply of goods or services or both shall declare the details of such debit note in the return for the month during which such debit note has been issued and the tax liability shall be adjusted in such manrier as may be prescribed. Explanation.—For the purposes of this Act, the - expression "debit note" shall include a supplementary invoice.

CHAPTERVIII

ACCOUNTS AND RECORDS

35, (1) Every registered person shall keep and maintain, at his principal place of business, as mentioned in the certificate of registration, a true and correct account of-

(a) production or manufacture of goods;

(b) inward and outward supply of goods or services or both;

(c) stock of goods;

(d) inputtax credit availed,

(e) output tax payable.and paid; and

(f) such otherparticulars as may be prescribed:

Provided that where morethan one place of businessis specified in the certificate of registration, the accounts, relating to each place of business shall be kept at such places of business:

Provided further that the registered person may keep and maintain such accounts and other particulars in electronic form in such manner as may beprescribed.

(2) Every owneror operator of warehouse or godown or any other place used for storage of goods and Accounts and other

records.

181

528 (180) Ree Usa, fer 12 YA 2017 every transporter, irrespective of whether he is a registered person or not, shall maintain records of the consigner, consignee and other relevant details of the goods in such manneras may beprescribed.

(3) The Commissioner may notify a class of taxable persons to maintain additional accounts or documents for such purpose as may be specified therein.

(4) Where the Commissioner considers that any class of taxable persons is not in a position to keep and maintain accounts in accordance with the provisionsof this section, he may, for reasons to be recorded in writing, permit such class of . taxable persons to maintain accounts in such

. Manneras maybe prescribed.

(5) Every registered person whose turnover during a financial year exceeds the prescribed limit shall get his accounts audited by a chartered accountant or a cost accountant and shall submit a copy of the audited annual accounts, the reconciliation statement under sub-section (2) of section 44 and such other documents in such form and manneras maybe prescribed.

(6) Subject to the provisions of clause (h) of sub- section (5) of section 17, where the registered person fails to account for the goodsor services or both in accordance with the provisions of sub- section (1), the proper officer shall determine the amount of tax payable on the goods orservices or both that are not accounted for, as if such goods or services or both had been supplied by such person and the provisions of section 73 or section 74, as the case may be, shall, mutatis mutandis, apply for determination of such tax.

36. Every registered person required to keep and maintain books of account or other records in accordance with the provisions of sub-section (1) of section 35 shall 'retain them until the expiry of seventy two months from. the due date of furnishing of annual return for . the year pertaining to such accounts andrecords:

Provided that a registered person, whois a party to an appeal or revision or any other proceedings before any Period. of retention of

accounts.

182

Hea usta, feria 12 FA 2017 528 (181) Appellate Authority or Revisional Authority or Appellate Tribunal or court, whether filed by him or by the Commissioner, or is under investigation for an offence under Chapter XIX, shall retain the books of account and other records pertaining to the subject matter of such appeal or revision or proceedings or investigation for a period of one year after final disposal of such appeal or revision or proceedingsor investigation, or for the. period specified above, whicheveris later.

CHAPTER IX

RETURNS

37.(1) Every registered person, other than an Input Service Distributor, a non-resident taxable person and a person paying tax underthe provisions ofsection 10 or section 51 or section 52, shall furnish, electronically, in such form and manner as may be prescribed, the details of outward supplies of goodsor services or both effected during a tax period on or before the tenth day of the month succeeding the said tax period and such details shall be communicated to the recipient of the said supplies within such time and in such manner as may be prescribed:

Provided that the registered person shall not be allowed to furnish the details of outward supplies during the period from the eleventh day to the fifteenth day of the month succeeding the tax period:

Provided further that the Commissioner may,for reasons to be recorded in writing, by notification, extend the time limit for furnishing such details for such class of taxable persons as may be specified therein:

Provided also that any extension of time limit notified by the Commissioner of central tax shall be deemedto be notified by the Commissioner. (2)Every registered person who has-been communicated the details under sub-section (3) of section 38 or the details pertaining to inward supplies of Input Service Distributor under sub- section (4) of section 38, shall either accept or Furnishing details of

outward supplies.

183

528 (182) ^HemeUsa,fetish^12YA2017| reject the details so communicated, on or before the seventeenth day, but not before the fifteenth day, of the month succeeding the tax period and the details furnished by him under sub-section (1) shall stand amended accordingly.

(3) Any registered person, who has furnished the details under sub-section (1) for any tax period and which have remained unmatched under section 42 or section 43, shall, upon discovery of any error or omission therein, rectify such error or omission in such manner as may be prescribed, and shall pay the tax and interest, if any, in case there is a short paymentof tax on account of such error or omission, in the return to be furnished for such tax period:

Provided that no rectification of error or omission in respect ofthe details furnished under sub- section (1) shall be allowed after furnishing of the return under section 39 for the month of September following the end ofthe financial year to which such details pertain, or furnishing of the relevant annual return, whicheveris earlier.

Explanation.—For the purposes of this Chapter, the expression "details of outward supplies" shall include details of invoices, debit notes, credit notes and revised invoices issued in relation to outward supplies made during any tax period.

38. (1) Every registered person, other than an Input Service Distributor or a non-resident taxable person or a person paying tax underthe provisions of section 10 or section 51 or section 52, shall verify, validate, -modify or delete, if required, the details relating to outward supplies and credit or debit notes communicated under sub-section (1) of section 37 to prepare the details ofhis inward supplies and credit or debit notes and may include therein, the details of inward supplies and credit or debit notes received by him in respect of such supplies that have not been declared by the supplier under sub-section (1) of section 37.

(2) Every registered person, other than an Input Service Distributor or a non-resident taxable Furnishing details of

inward supplies.

5lof 1975

184

Aeqge Ustaa, fetim 12 YA 2017 528 (183) person or a person paying tax under the provisions of section 10 or section 51 or section 52, shall furnish, electronically, the details of inward supplies of taxable goods or services or both, including inward supplies of goods or services or both on which the tax is payable on reverse charge basis under this Act and inward supplies of goods or services or both taxable under the Integrated Goods and Services Tax Act or on which integrated goods and services tax is payable under section 3 of the Customs Tariff Act, 1975, and credit or debit notes received in respect of such supplies during a tax period after the tenth day but on or before the fifteenth day of the month — succeeding the tax period in such form and manneras maybe prescribed:

Provided that the Commissioner may, for reasons to be recorded in writing, by notification, extend the timelimit for furnishing such details for such class of taxable persons as may bespecified therein:

Provided further that any extension of time limit notified by the Commissioner of central tax shall be _ deemedto benotified by the Commissioner.

(3) The details of supplies modified, deleted or included by the recipient and furnished under sub- section (2) shall be communicated to the supplier concerned in such manner and within such time as may beprescribed.

(4) The details of supplies modified, deleted or included by the recipient in the return furnished under sub-section (2) or sub-section (4) of section 39 shall be communicated to the supplier concerned in such manner and within such time as maybeprescribed.

(5) Any registered person, who has furnished the details under sub-section (2) for any tax period and which have remained unmatched under section 42 or section 43, shall, upon discovery of any error or omission therein, rectify such error or omission in the tax period during which such error or omission is noticed in such manner as may be prescribed, and shall pay the tax and interest, if

185

528 (184) Hee WITS, feat 12 FA 2017 any, in case there is a short payment of tax on account of such error or omission, in the return to be furnished for such tax period:

Provided that no rectification of error or omission in respect of the details furnished under sub-section (2) shall be allowed after furnishing of the return under section 39 for the month of September following the end of the financial year to which such details pertain, or furnishing ofthe relevant annual return, whicheveris earlier.

39. (1) Every registered person, other than an Input Service Distributor or a non-resident taxable person or a person paying tax underthe provisions of section 10 or section 51 or section 52 shall, for every calendar month or part thereof, furnish, in such form and manner as may beprescribed, a return, electronically, of inward and outward supplies of goods or services or both, input tax credit availed, tax payable, tax paid and such otherparticulars as may be prescribed on or before the twentieth day of the month succeeding such calendar month orpart thereof.

(2)A registered person paying tax under the provisions of section 10 shall, for each quarter or part thereof, furnish, in such form and manneras may be prescribed, a return, electronically, of turnover in the State, inward supplies of goods or services or both, tax payable and tax paid within eighteen days after the end of such quarter.

(3) Every registered person required to deduct tax at _ source under the provisions of section 51 shall furnish, in such form and manner as may be prescribed, a return, electronically, for the month in which such deductions have been made within ten days after the end of such month.

(4) Every taxable person registered as an Input Service Distributor shall, for every calendar month or part thereof, furnish, in such form and manner as may be prescribed, a_ return, electronically, within thirteen days after the end of such month.

(5) Every registered non-resident taxable person shall, for every calendar month or part thereof, furnish, Furnishing of returns.

186

Heer wad, fete 12 FA 2017 528 (185) in such form and manner as may beprescribed, a return, electronically, within twenty days after the end of a calendar month or within seven daysafter the last day of the period of registration specified under sub-section (1) of section 27, whichever is earlier.

(6) The Commissioner may, for reasons to be recorded in writing, by notification, extend the time limit for furnishing the returns under this section for such class of registered persons as may be specified therein:

Provided that any extension of time limit notified by the Commissioner of central tax shall be deemed to be notified by the Commissioner.

(7) Every registered person, who is required to furnish a return under sub-section (1) or sub- section (2) or sub-section (3) or sub-section (5), shall pay to the Government the tax due as per such return notlater than the last date onwhich he is required to furnish such return.

(8) Every registered person whois required to furnish a return under sub-section (1) or sub-section (2) shall furnish a return for every tax period whether or not any supplies of goods or services or both have been made during such tax period.

(9) Subject to the provisions of sections 37 and 38, if any registered person after furnishing a return under sub-section (1) or sub-section (2) sub- section (3) or sub-section (4) or sub-section (5) discovers any omission or incorrect particulars therein, other than as a result of scrutiny, audit, inspection or enforcement activity by the tax authorities, he shall rectify such omission or incorrect particulars in the return to be furnished for the month or quarter during which such omission or incorrect particulars are noticed, subject to paymentof interest under this Act:

Provided that no suchrectification of any omission or incorrect particulars shall be allowed after the due date for

187

528 (186)

51 of 1975. Fee Usa, FeAl 12 FA 2017 furnishing of return for the month of September or second quarter following the end of the financial year, or the actual date of furnishing of relevant annual return, whicheveris earlier.

(10) A registered person shall not be allowed to

40.

41.

42.

furnish a return for a tax period if the return for any of the previous tax periods has not been _ furnished by him:

Every registered person who has made outward supplies in the period between the date on which he became liable to registration till the date on which registration has been granted shall declare the same in the first return furnished by him after grant of registration.

(1) Every registered person shall, subject to such conditions and restrictions as may be prescribed, be entitled to take the credit of eligible input tax, as self- assessed, in his return and such amount shall be credited on a provisional basis to his electronic credit ledger.

(2) The credit referred to in sub-section (1) shall be utilised only for payment of self-assessed output tax as per the return referred to in the said sub-section.

(1) The details of every inward supply furnished by a registered person (hereafter in this section referred to as the "recipient") for a tax period shall, in such manner and within such time as may be prescribed, be matched—

(a) with the corresponding details of outward supply furnished by the corresponding registered person (hereafter in this section referred to as the

"supplier") in his valid return for the same tax period or any preceding tax period;

(b) with the integrated goods and services tax paid under section 3 of the Customs Tariff Act, 1975 in respect of goods imported by him; and First Return.

Claim of input tax ©

credit and provisional

acceptancethereof.

Matching, reversal and

reclaim of input tax

. \ credit.

188

meagee Ustaa, fee 12 YA 2017 528 (187) 51 of 1975

(c) for duplication of claimsofinput tax credit.

(2) The claim ofinput tax credit in respect of invoices or debit notes relating to inward supply that match with the details of corresponding outward supply or with the integrated goods and services tax paid under section 3 of the CustomsTariff Act, 1975 in respect of goods imported by him shall befinally accepted and such acceptance shall be

communicated, in such manner as may be prescribed, to the recipient.

(3) Where the input tax credit claimed by a recipient in respect of an inward supply is in excess of the tax declared by the supplier for the same supply or the outward supply is not declared by the supplier in his valid returns, the discrepancy shail be communicated to both such persons in such manner as maybe prescribed.

(4) The duplication of claims of input tax credit shall be communicated to the recipient in such manner as may beprescribed.

(5) The amount in respect of which any discrepancy is communicated under sub-section (3) and which is not rectified by the supplier in his valid return for .the 'month in which discrepancy is communicated shall be added to the output tax liability of the recipient, in such manner as may be prescribed, in his return for the month succeeding the month in which the discrepancy is communicated.

(6) The amount claimed as input tax credit that is found to be in excess on accountof duplication of claims shall be added to the output tax liability of the recipient in his return for the month in which the duplication is communicated.

(7) The recipient shall be eligible to reduce, from his output tax liability, the amount added under sub- section (5), if the supplier declares the details of the invoice or debit note in his valid return within the time specified in sub-section (9) of section 39.

189

528 (188) Heme Usa, fear 12 FA 2017

(8) A recipient in whose output tax liability any amount has been added under sub-section (5) or sub-section (6), shall be liable to pay interest at the rate specified under sub-section (1) of section 50 on the amount so added from the date of availing of credit till the corresponding additions are made underthe said sub-sections.

(9) Where any reduction in output tax liability is accepted under sub-section (7), the interest paid under sub-section (8) shall be refunded to the recipient by crediting the amount in the corresponding head ofhis electronic cash ledger in such manneras maybeprescribed:

Provided that the amount of interest to be credited in any case shall not exceed the amount of interest paid by the supplier.

(10) The amount reduced from the output tax

43.

liability in contravention of the provisions of sub- section (7) shall be added to the output tax liability of the recipient in his return for the month in which such contravention takes place and such recipient shall be liable to pay interest on the amount so added at the rate specified in sub- section (3) of section 50.

(1) The details of every credit note relating to outward supply furnished by a registered person (hereafter in this section referred to as the "supplier") for a tax period shall, in such manner and within such time as maybe prescribed, be matched—

(a) with the corresponding reduction in the claim for input tax credit by the corresponding registered person (hereafter in this section referred to as the

"recipient") in his valid return for the same tax period or any subsequenttax period; and

(b) for duplication of claims for reduction in output tax liability. ~

(2) The claim for reduction in output tax liability by the supplier that matches with the corresponding Matching, reversal and -

reclaim of reduction in

outputtax liability.

190

Hep usa, fetis 12 YA 2017 528 (189) reduction in the claim for input tax credit by the recipient shall be finally accepted and communicated, in such manner as may be prescribed, to the supplier.

(3) Where the reduction of output tax liability in respect of outward supplies exceeds the corresponding reduction in the claim for input tax credit or the corresponding credit note is not declared by the recipient in his valid returns, the discrepancy shall be communicated to both such persons in such manneras maybeprescribed.

(4) The duplication of claims for reduction in output tax liability shall be communicated to the supplier in such manneras maybe prescribed.

(5) The amount in respect of which any discrepancy is communicated under sub-section (3) and which is not rectified by the recipient in his valid return for the month in which discrepancy is communicated shall be added to the output tax liability of the supplier, in such manner as may be prescribed, in his return for the month succeeding the month in which the discrepancy is communicated.

(6) The amount in respect of any reduction in output tax liability that is found to be on account of duplication of claims shall be added to the output tax liability of the supplier in his return for the month in which such duplication is

communicated.

(7) The supplier shall be eligible to reduce, from his output tax liability, the amount added under sub- section (5) if the recipient declares the details of the credit note in his valid return within the time specified in sub-section (9) of section 39,

(8) A supplier in whose output tax liability any amount has been added under sub-section (5) or sub-section (6), shall be liable to pay interest at the rate specified under sub-section (1) of section 50 in respect of the amount so added from the date of such claim for reduction in the output tax _

191

528 (190) Hee UIT, fea 12 FA 2017 liability till the corresponding additions are made underthe said sub-sections.

(9) Where any reduction in output tax liability is accepted under sub-section (7), the interest paid under sub-section (8) shall be refunded to the supplier by crediting the amount in the corresponding head ofhis electronic cash ledger in such manneras maybeprescribed:

Provided that the amount of interest to be credited in any case shall not exceed the amountofinterest paid by the recipient.

(10) The amount reduced from output tax liability

44,

in contravention of the provisions of sub-section

(7) shall be added to the output tax liability of the supplier in his return for the month in which such contravention takes place and such suppliershall be liable to pay interest on the amount so added at the rate specified in sub-section (3) of section 50.

(1) Every registered person, other than an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and a non- resident taxable person, shall furnish an annual return for every financial year electronically in such form and manner as may be prescribed on or before the thirty-first day of December following the end of such financial year.

(2) Every registered person whois required to get his

45.

accounts audited in accordance with the provisions of sub-section (5) of section 35 shall furnish, electronically, the annual return under sub-section (1) along with a copy of the audited annual accounts and a reconciliation statement, reconciling the value of supplies declared in the return furnished for the financial year with the audited annual financial statement, and such other particulars as may be prescribed.

Every registered person who is required to furnish a return under sub-section (1) of section 39 and whose registration has been cancelled shall furnish a final return within three months ofthe date of cancellation Annual return.

Final return.

192

46.

47.

Hee Us, feals 12 YA 2017 or date of order of cancellation, whichever is later, in such form and manneras maybeprescribed. Where a registered person fails to furnish a return under section 39 or section 44 or section 45, a notice shall be issued requiring him to furnish such return within fifteen days in such form and manner as may be prescribed.

(1) Any registered person who fails to furnish the details of outward or inward supplies required under section 37 or section 38 or returns required under section 39 or section 45 by the due date shall pay a late fee of one hundred rupees for every day during which such failure continues subject to a maximum amountof five thousand rupees. |

(2) Any registered person who fails to furnish the

48.

return required under section 44 by the due date shall be liable to pay a late fee of one hundred rupees for every day during which such failure continues subject to a maximum of an amount calculated at a quarter per cent of his turnover in the State.

(1) The manner of approval of goods and services tax practitioners, their eligibility conditions, duties and obligations, manner of removal and other conditions relevant for their functioning shall be such as may be. prescribed.

(2) A registered person may authorise an approved goods and services tax practitioner to furnish the details of outward supplies under section 37, the details of inward supplies under section 38 and the return under section 39 or section 44 or section 45 in such manneras maybeprescribed.

(GB) Notwithstanding anything contained in sub- section (2), the responsibility for correctness of any particulars furnished in the return or other details filed by the goods and services tax practitioners shall continue to rest with the registered person on whose behalf such return and details are furnished.

528 (191)

Notice to return defaulters.

Levyoflate fee. Goodsand services tax practitioners.

193

528 (192) Hee Usa, fee 12 FA 2017

CHAPTER X

PAYMENTOF TAX

49. (1) Every deposit made towards tax, interest, penalty, Payment ^oftax, fee or any other amount by a person by internet interest, penalty and banking or by using credit or debit cards or National other amounts. Electronic Fund Transfer or Real Time Gross

Settlement or by such other mode and subject to such conditions and restrictions as may be prescribed, shall. be credited to the electronic cash ledger of such

person to be maintained in such manner as may be

prescribed.

(2) The input tax credit as self-assessed in the return of a registered person shall be credited to his electronic credit ledger, in accordance with section 41, to be maintained in such manner as may beprescribed.

(3) The amount available in the electronic cash ledger may be used for making any payment towards tax, interest, penalty, fees or any other amount payable underthe provisions of this Act or the rules made thereunder in such manner and subject to such conditions and within such time as may be prescribed.

(4) The amount available in the electronic credit ledger may be used for making any payment towards output tax under this Act or under the Integrated Goods and Services Tax Act in such mannerand subject to such conditions and within such time as maybe prescribed.

(5) The amount of input tax credit available in the electronic credit ledger of the registered person on account of—

(a) integrated tax shall first be utilised towards payment of integrated tax and the amount remaining, if any, may be utilised towards the paymentofcentral tax and State tax, or as the case maybe, Unionterritory tax, in that order;

(b) the central tax shall first be utilised towards paymentofcentral tax and the amount remaining, if any, may be utilised towards the payment of integrated tax;

194

Fee usta, fer 12 FA 2017 528 (193)

(c) the State tax shall first be utilised towards payment of State tax and the amount remaining, if any, may be utilised towards the payment of integrated tax;

(d) the Union territory tax shall first be utilised towards payment of Unionterritory tax and the amount remaining, if any, may beutilised towards the paymentofintegrated tax;

(e) the central tax shall not be utilised towards paymentofState tax or Unionterritory tax; and

(f) the State tax or Union territory tax shail not be utilised towards paymentof central tax.

(6) The balance in the electronic cash ledger or electronic credit ledger after payment of tax, interest, penalty, fee or any other amount payable under this Act or the rules made thereunder may be refunded in accordance with the provisions of section 54.

(7) All liabilities of a taxable person under this Act shall be recorded and maintained in an electronic liability register in such manner as may be prescribed.

(8) Every taxable person shall discharge his tax and other dues under this Act or the rules made thereunderin the following order, namely:—

(a) self-assessed tax, and other dues related to returns of previous tax periods;

(b) self-assessed tax, and other dues related to the return of the current tax period;

(c) any other amountpayable underthis Actor t he

rules made thereunder including the demand determined undersection 73 or section 74.

(9) Every person who has paid the tax on go ods or

services or both under this Act shall, unles s the

contrary is proved by him, be deemed to have

passed on the full incidence of such tax to the

recipient of such goodsorservices or both.

195

528 (194) HEA Usa, fei 12 FA 2017 Explanation.—Forthe purposesofthis section,

(a) the date of credit to the account of the Government in the authorised bank shall be deemed to be the date of deposit in the electronic cash ledger;

(b) the expression,-

(i) "tax dues" means the tax payable under this Act and doesnotinclude interest, fee and penalty; and

(ii) "other dues" meansinterest, penalty, fee or any other amount payable under this Act or the rules madethereunder.

50.(1) Every person who is liable to pay tax in

(2) The interest under sub-section (1) shall be calculated, in such manner as may be prescribed, _ accordance with the provisions of this Act or the rules made thereunder, but fails to pay the tax or any part thereof to the Government within the period prescribed, shall for the period for which the tax or any part thereof remains unpaid, pay, on his own, interest at such rate, not exceeding eighteen per cent., as may be notified by the Government on the recommendationsofthe Council.

from the day succeeding the day on which such tax was due to be paid.

GB) A taxable person who makes an undueor excess

51.

claim of input tax credit under sub-section (10) of section 42 or undue or excess reduction in output tax liability under sub-section (10) of section 43, shall pay interest on such undue or excess claim or on such undue or excess reduction, as the case maybe,at such rate not exceedingtwenty-four per cent, as may be notified by the Governmenton the recommendations of the Council.

(1) Notwithstanding anything to the contrary contained in this Act, the Government may mandate-

(a) a department or establishment of the Central Government or State Government; or

(b) local authority; or Interest on delayed paymentoftax.

Tax deduction at source.

196

Heer usa, feat 12 Ft 2017

(c) Governmental agencies; or

(d) such persons or category of persons as may be notified by the Government on the recommendations of the Council,

(hereafter in this section referred to as "the deductor"), to deduct tax at the rate of one per cent from the payment made or credited to the supplier (hereafter in this section referred to as "the deductee") of taxable goodsor services or both, where the total value of such supply, under a contract, exceeds two lakh and fifty thousand rupees:

Provided that no deduction shall be made if the location of the supplier and the place of supply is in a State or Union territory which is different from the State or, as the case may be, Unionterritory of registration of the recipient.

Explanation.—For the purpose of deduction of tax specified above, the valueof supply shall be taken as the amount excluding the central tax, State tax, integrated tax and cessindicated in the invoice.

(2) The amount deducted as tax under this section shall be paid to the Government by the deductor within ten days after the end of the month in which such deduction is made, in such manner as may beprescribed.

(3) The deductor shall furnish to the deductee a certificate mentioning therein the contract value, rate of deduction, amount deducted, amount paid to the Government and such other particularsin such manneras maybe prescribed.

(4) If any deductor fails to furnish to the deductee the certificate, after deducting the tax at source, within five days of crediting the amount so deducted to the Government, the deductor shall pay, by wayofa late fee, a sum of one hundred rupees per day from the day after the expiry of such five day period until the failure is rectified, subject to a maximum amountoffive thousand rupees.

528 (195)

197

528 (196)

Ree wea, feaie 12 FA 2017

(5) The deductee shall claim credit, in his electroni c

cash ledger, of the tax deducted and reflected in the return of the deductor furnished under sub- section (3) of section 39, in such manner as may be prescribed.

(6) If any deductorfails to pay to the Government the amount deducted as tax under sub-section (1), he shall pay interest in accordance with the provisions of sub-section (1) of section 50, in addition to the amountoftax deducted.

(7) The determination of the amount in default under this section shall be made in the mannerspecified in section 73 or section 74.

(8) The refund to the deductor or the deductee arising on account of excess or erroneous deduction shall be dealt with in accordance with the provisions of section 54: .

Provided that no refund to the deductor shall be granted, if the amount deducted has been credited to the electronic cash ledgerofthe deductee.

52.(1) Notwithstanding anything to the contrary contained in this Act, every electronic commerce operator (hereafter in this section referred to as the

"operator"), not being an agent, shall collect an amount calculated at such rate not exceeding one per cent., as may be notified by the Government on the recommendations of the Council, of the net value of taxable supplies made through it by other suppliers where the consideration with respect to such supplies is to be collected by the operator.

Explanation.—-For the purposes of this sub-section , the

expression "net value of taxable supplies" shall mean the

aggregate value of taxable supplies of goods or services or

both, other than services notified under sub-sectio n (5) of

section 9, made during any month by all regis tered

persons through the operator reduced by the a ggregate

value of taxable supplies returned to the suppliers dur ing

the said month.

Collection of tax at

source.

198

Femmes wuss, fea 12 FA 2017 528 (197)

(2) The powerto collect the amount specified in sub- section (1) shall be without prejudice to any other modeofrecovery from the operator.

(3) The amountcollected under sub-section (1) shall be paid to the Government by the operator within ten days after the end of the month in which such collection is made, in such manner as may be prescribed.

(4) Every operator who collects the amount specified in sub-section (1) shall furnish a statement, electronically, containing the details of outward supplies of goods or services or both effected through it, including the supplies of goods or services or both returned through it, and the amount collected under sub-section (1) during a month, in such form and manner as may be prescribed, within ten days after the end of such month.

(5) Every operator who collects the amount specified in sub-section (1) shall furnish an annual statement, electronically, containing the details of outward supplies of goods or services or both effected through it, including the supplies of goodsor services or both returned through it, and the amount collected under the said sub-section during the financialyear, in such form and manner as may be prescribed, before the thirty first day of December following the end of such financial year.

(6) If any operator after furnishing a statement under sub-section (4) discovers any omission or incorrect particulars therein, other than as a result of scrutiny, audit, inspection or enforcement activity by the tax authorities, he shall rectify such omission or incorrect particulars in the statement to be furnished for the month during which such omission or incorrect particulars are noticed, subject to paymentofinterest, as specified in sub- section (1) of section 50:

Provided that no such rectification of any omission or incorrect particulars shall be allowed after the dye date for furnishing of statement for

199

528 (198) Hee Usya, erie 12 FA 2017 the month of September following the end ofthe financial year or the actual date of furnishing of the relevant annual statement, whichever is earlier.

(7) The supplier who has supplied the goods or services or both through the operator shall claim:

credit, in his electronic cash ledger, of the amount collected and reflected in the statement of the operator furnished under sub-section (4), in such manner as maybeprescribed.

(8) The details of supplies furnished by every operator under sub-section (4) shall be matched with the corresponding details of outward supplies furnished by the concerned 'supplier registered under this Act in such manner and within such time as maybeprescribed.

(9) Where the details of outward supplies furnished bythe operator under sub-section (4) do not match with the corresponding details furnished by the supplier under section 37, the discrepancy shall be communicated to both persons in such manner and within such time as may be prescribed.

(10) The amount in respect of which any discrepancy is communicated under sub-section _(9) and whichis notrectified by the supplierin his valid return or the operator in his statementfor the month in which discrepancy is communicated, shall be added to the outputtax liability of the said supplier, where the value of outward supplies furnished by the operator is more than the value of outward supplies furnished by the supplier, in his return for the month succeeding the month in which the discrepancy is communicated in such manneras may beprescribed.

(11) The concerned supplier, in whose output tax liability any amount has been added under sub- section (10), shall pay the tax payable in respect of such supply along with interest, at the rate specified under sub-section (1) of section 50 on the amount so added from the date such tax was duetill the date of its payment. —

200

Hee wat, fee 12 FA 2017 528 (199)

(12) Any authority not below the rank of Deputy Commissioner may servea notice, either before or during the course of any proceedings under this Act, requiring the operator to furnish such details relating to—

(a) supplies of goods or services or both effected through such operator during any period; or

(b) stock of goods held by the suppliers making supplies through such operator in the godownsor warehouses, by whatever namecalled, managed by such operator and declared as additional places of business by such suppliers, as maybespecified in the notice.

(13) Every operator on whom a notice has been served under sub-section (12) shall furnish the required information within fifteen working days of the date of service ofsuch notice.

(14) Any person who fails to furnish the information required by the notice served under sub-section (12) shall, without prejudice to any action that may be taken under section 122, be liable to a penalty which may extend to twenty- five thousand rupees.

Explanation.—For the purposes of this section, the expression "concerned supplier" shall mean the supplier of goods or services or both making supplies through the operator.

53. Onutilisation of input tax credit availed under this Act Transfer of input tax for payment of tax dues under the Integrated Goods credit. and Services Tax Act in accordance with the

provisions of sub-section (5S) of section 49, as

reflected in the valid return furnished under sub-

section (1) of section 39, the amountcollected as State

tax shall stand reduced by an amount equal to such

credit so utilised and the State Government shall

transfer an amount equal to the amount so reduced

from the State tax account to the integrated tax

account in such manner and within such time as may

be prescribed.

*

201

528 (200) Feage Users, fei 12 YA 2017

CHAPTERXI

REFUNDS

54.(1) Any person claiming refund of any tax and Refundoftax. interest, if any, paid on such tax or any other amount paid by him, may make an application before the expiry of two years from the relevant date in such form and manner as maybe prescribed:

Provided that a registered person, claiming refund of any balance in the electronic cash ledger in accordance with the provisions of sub-section (6) of section 49, may claim such refund in the return furnished under section 39 in such manner as may be prescribed,

(2) A specialized agency of the United Nations Organization or any Multilateral Financial Institution and Organization notified under the 46 of 1947. United Nations (Privileges and Immunities) Act, 1947, Consulate or Embassy of foreign countries or any other person or class of persons, as notified under section 55, entitled to a refund of tax paid by it on inward supplies of goods or services or both, may make an application for such refund, in such form and manner as may be prescribed, before the expiry of six months from the last day of the quarter in which such supply was received.

(3) Subject to the provisions of sub-section (10), a registered person may claim refund of any unutilised input tax credit at the end of any tax period:

Provided that no refund of unutilised input tax credit shall be allowed in cases other than- - (i) zero-rated supplies made without payment of tax; .

(ii) where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies (other than nil rated or fully exempt supplies), except supplies of goods or services or both as may be notified by the Government on the recommendations of the Council:

202

Aeage wstaa, feats 12 VA 2017 Provided further that no refund of unutilised input tax credit shall be allowed in cases where the goods exported out of India are subjected to export duty:

Provided also that no refund of input tax credit shall be allowed, if the supplier of goods or services or both claims refund ofthe integrated tax paid on such supplies.

(4) The application shall be accompanied by—

(a) such documentary evidence as maybe prescribed to establish that a refund is due to the applicant; and

(b) such documentary or other evidence (including the documentsreferred to in section 33) as the applicant may | furnish to establish that the amountof tax andinterest, if any, paid on such tax or any other amountpaid in relation to which such refund is claimed was collected from, or paid by, him and the incidence of such tax and interest had not been passed on to any other person: _ Provided that where the amount claimed as refund is less than two lakh rupees,it shall not be necessary for the applicant to furnish any documentary and other evidences but he mayfile a declaration, based on the documentary or other evidences available with him, certifying that the incidence of such tax and interest had not been passed on to any other person.

(5) If, on receipt of any such application, the proper officer is satisfied that the whole or part of the amount claimed as refund is refundable, he may make an order accordingly and the amount so determined shall be credited to the Fund referred to in section 57.

(6) Notwithstanding anything contained in sub- section (5), the proper officer may, in the case of any claim for refund on account of zero-rated supply of goods or services or both made by registered persons, other than such category of registered persons as may be notified by the Government on the recommendations of the Council, refund on a provisional basis, ninety per cent of the total amount so claimed, excluding the

528 (201)

203

528 (202) Reger usa, fete 12 FA 2017 amountof input tax credit provisionally accepted, in such manner and subject to such conditions, limitations and safeguards as may be prescribed and thereafter make an order under sub-section (5) for final settlement of the refund claim after due verification of documents furnished by the applicant.

(7) The properofficer shall issue the order under sub- section (5) within sixty days from the date of receipt of application complete in all respects.

(8) Notwithstanding anything contained in sub- section (5), the refundable amountshall, instead of | being credited to the Fund, be paid to the applicant, if such amountis relatable to —

(a) refund of tax paid on zero-rated supplies of goodsor services or both or on inputs or input services _ used in making such zero-rated supplies;

(b) refund of unutilised input tax credit under sub- section (3);

(c) refund of tax paid on a supply which is not provided, either wholly or partially, and for which invoice has not been issued, or where a refund voucher has been issued;

(d) refund of tax in pursuance of section 77;

(e) the tax and interest, if any, or any other amount paid by the applicant, if he had not passed on the incidence of such tax and interest to any other person; or

(f) the tax or interest borne by such other class of applicants as the Government may, on_ the recommendations of the Council, by notification, specify.

2

(9) Notwithstanding anything to the contrary contained in any judgment, decree, order or direction of the Appellate Tribunal or any court or in any other provisions of this Act or the rules made thereunder or in any other law for the time

204

meager usta, frie 12 4A 2017 528 (203) being in force, no refund shall be made except in accordance with the provisions of sub-section (8).

(10) Where any refund is due under sub-section (3) | to a registered person who has defaulted in furnishing any return or who is required to pay any tax, interest or penalty, which has not been stayed by any court, Tribunal or Appellate Authority by the specified date, the proper officer may—

(a) withhold payment of refund due until the said person has furnished the return or paid the tax, interest or penalty, as the case may be;

(b) deduct from the refund due, any tax, interest, penalty, fee or any other amount which the taxable personis liable to pay but which remains unpaid under this Act or underthe existing law.

_ Explanation.—For the purposesofthis sub-section, the expression "specified date" shall mean the last date for filing an appeal underthis Act.

(11) Where an order giving rise to a refund is the subject matter of an appeal or further proceedings or where any other proceedings under this Act is pending and the Commissioneris of the opinion that grant of such refund is likely to adversely affect the revenue in the said appeal or other proceedings on account of malfeasance or fraud committed, he may, after giving the taxable person an opportunity of being heard, withhold the refundtill such time as he may determine.

(12) Where a refund is withheld under sub-section (11), the taxable person shall, notwithstanding anything contained in section 56, be entitled to interest at such rate not exceeding six per cent as may be notified on the recommendations of the Council, if as a result of the appeal or further proceedings he becomesentitled to refund.

(13) Notwithstanding anything to the contrary contained in this section, the amount of advance tax deposited by a casual taxable person or a non-

205

528 (204) Hee usta, fete 12 YA 2017 resident taxable person under sub-section (2) of section 27, shall not be refunded unless such person has, in respect of the entire period for whichthecertificate of registration granted to him had remained in force, furnished all the returns required undersection 39.

(14) Notwithstanding anything contained in this section, no refund under sub-section (5) or sub- section (6) shall be paid to an applicant, if the amountis less than one thousandrupees. Explanation.—Forthe purposesofthis section,—

(1) "refund" includes refund of tax paid on zero- rated supplies of goods or services or both or on inputs Or input services used in making such zero-rated supplies, or refund of tax on the supply of goods regarded as deemed exports, or refundof unutilised input tax credit as provided under sub-section (3).

(2) "relevant date" means —

(a) in the case of goods exported out of India where a refund oftax paid is available in respect of goods themselvesor, as the case may be, the inputs or input services used in such goods,—

(i) if the goods are exported by sea orair, the date on which the ship ortheaircraft in which such goodsare loaded, leaves India; or

(ii) if the goods are exported by land, the date on which such goodspassthe frontier; or

(iii) if the goods are exported by post, the date of despatch of goods by the Post Office concernedto a place outside India;

(b) in the case of supply of goods regarded as deemed exports where a refund of tax paid is available in respect of the goods, the date on which the return relating to such deemed exports is furnished;

206

Reger wstTs, fer 12 FA 2017 528 (205) 46of 1947.

(c) in the case of services exported out of India where a refund of tax paid is available in respect of services themselves or, as the case may be, the inputs or input services used in such services, the date of—

(i) receipt of payment in convertible foreign exchange, where the supply of services had been completedprior to the receipt of such payment; or

(ii) issue of invoice, where payment for the services had been received in advance prior to the date of issue of the invoice;

(d) in case where the tax becomes refundable as a consequenceofjudgment, decree, order or direction of the Appellate Authority, Appellate Tribunal or any court, the date of communication of such judgment, decree, order or direction;

(e) in the case of refund of unutilised input tax credit under sub-section (3), the end of the financial year in whichsuchclaim for refund arises;

(f) in the case where tax is paid provisionally under this Act or the rules made thereunder, the date of adjustmentoftax after the final assessmentthereof;

(g) in the case of a person, other than the supplier, the date of receipt of goodsor services or both by such person; and

(h) in any other case, the date of paymentoftax.

55. The Government may, on the recommendations of the Council, by notification, specify any specialized agency of the United Nations Organization or any Multilateral Financial Institution and Organization notified under the United Nations (Privileges and Immunities) Act, 1947, Consulate or Embassy of foreign countries and any other person or class of persons as maybe specifiedin this behalf, who shall, subject to such conditions and restrictions as may be prescribed, be entitled to claim a refund of taxes paid on the notified supplies of goods or services or both received by them.

Refund in certain cases.

207

528 (206) HeaeR wera, feat 12 FA 2017

56. If any tax ordered to be refunded under sub-section (5) Interest on delayed of section 54 to any applicant is not refunded within refunds. sixty days from the date of receipt of application

under sub-section (1) of that section, interest at such rate not exceeding six per cent. as may be specified in the notification issued by the Government on the

recommendations of the Council shall be payable in ~

" respect of such refund from the date immediately after the expiry of sixty days from the date of receipt of application under the said sub-sectiontill the date of refund of such tax:

Provided that where any claim of refund arises from an order passed by an adjudicating authority or Appellate Authority or Appellate Tribunal or court which has attained finality and the same is not refunded within sixty days from the date of receipt of application filed consequent to such order, interest at such rate not exceeding nine per cent. as may be notified by the Government on the recommendations of the Council shall be payable in respect of such refund from the date immediately after the expiry of sixty days from the date of receipt of application till the date of refund.

Explanation.—For the purposes of this section, where any order of refund is made by an Appellate Authority, Appellate Tribunal or any court against an order of the proper officer under sub-section (5) of section 54, the order passed by the Appellate Authority, Appellate Tribunal or by the court shall be deemed to be an order passed underthe said sub-section (5).

57. The Governmentshall constitute a Fund, to be called Consumer Welfare the Consumer Welfare Fund and there shall be Fund. credited to the Fund,—

(a) the amount referred to in sub-section (5) of section 54;

(b) any income from investment of the amount credited to the Fund; and

(c) such other monies received byit, in such manner as maybeprescribed.

208

Reape wstya, fea 12 YA 2017 528 (207)

58. (1) All sumscredited to the Fund shall be utilised by Utilisation of Fund. the Government for the welfare of the consumers in

such manner as maybe prescribed.

(2) The Government or the authority specified by it shall maintain proper and separate account and other relevant records in relation to the Fund and prepare an annual statement of accounts in such form as may beprescribed in consultation with the Comptroller and Auditor General of India.

CHAPTERXII

ASSESSMENT

59, Every registered person shall self-assess the taxes Self-assessment. payable under this Act and furnish a return for each tax period as specified under section 39.

60. (1) Subject to the provisions of sub-section (2), where Provisional assessment. the taxable personis unable to determine the value of

goodsor services or both or determine the rate of tax

applicable thereto, he may request the properofficer

in writing giving reasons for payment of tax on a

provisional basis and the proper officer shall pass an

order, within a period not later than ninety days from

the date of receipt of such request, allowing payment

of tax on provisional basis at such rate or on such

value as may be specified by him.

(2) The payment of tax on provisional basis may be allowed, if the taxable person executes a bond in such form as may be prescribed, and with such surety or security as the proper officer may deem fit, binding the taxable person for payment of the difference between the amount of tax as may be finally assessed and the amountoftax provisionally assessed.

(3) The properofficer shall, within a period not exceeding six months from the date of the communication of the order issued under sub-section (1), pass the final assessment order after taking into account such information as may be required for finalizing the assessment:

209

528 (208) Ree Ustaa, fei 12 FA 2017 Provided that the period specified in this sub- section may, on sufficient cause being shown and for reasons to be recorded in writing, be extended by the Joint Commissioner or Additional Commissionerfor a further period not exceeding six months and by the Commissioner for such further period not exceeding four years.

(4) The registered person shall be liable to pay interest on any tax payable on the supply of goodsor services or both under provisional assessment but not paid on the due date specified under sub-section (7) of section 39 or the rules made thereunder, at the rate specified under sub-section (1) of section 50, from the first day after the due date of paymentof tax in respect of the said supply of goods or services or both till the date of actual payment, whether such amountis paid before or after the issuance oforder for final assessment.

(5) Where the registered person is entitled to a refund

61.

consequentto the orderof final assessment under sub- section (3), subject to the provisions of sub-section (8) of section 54, interest shall be paid on such refund as provided in section 56.

(1) The proper officer may scrutinize the return and related particulars furnished by the registered person to verify the correctness of the return and inform him of the discrepancies noticed, if any, in such manner as may be prescribed and seek his explanation thereto.

(2) In case the explanation is found acceptable, the registered person shall be informed accordingly and no further action shall be takenin this regard.

(3) In case no satisfactory explanation is furnished within a period ofthirty days of being informed by the proper officer or such further period as may be permitted by him or where the registered person,after accepting the discrepancies,fails to take the corrective measure in his return for the month in which the discrepancy is accepted, the proper officer may initiate appropriate action including those under section 65 or section 66 or section 67, or proceed to determine the tax and other dues under section 73 or section 74.

Scrutiny of returns.

210

eames Usa, fea 12 FA 2017 528 (209) 62.(1) Notwithstanding anything to the contrary Assessment of non- contained in section 73 or section 74, where a_ filers of returns. registered person fails to furnish the return under section 39 or section 45, even after the service of a notice under section 46, the proper officer may proceed to assess the tax liability of the said person to the best of his judgement taking into accountall the relevant material which is available or which he has gathered and issue an assessment order within a period of five years from the date specified under section 44 for furnishing of the annual return for the financial year to which the tax not paid relates.

(2) Where the registered person furnishes a valid return within thirty days of the service of the assessment order under sub-section (1), the said assessment order shall be deemed to have been withdrawn but the liability for payment of interest under sub-section (1) of section 50 or for paymentof late fee under section 47 shall continue.

63. Notwithstanding anything to the contrary contained in Assessment of section 73 or section 74, where a taxable person fails unregistered persons. to obtain registration even though liable to do so or whose registration has been cancelled under sub-

section (2) of section 29 but who was liable to pay tax, the proper officer may proceed to assess the tax

liability of such taxable person to the best of his

judgement for the relevant tax periods and issue an

assessment order within a period of five years from

the date specified under section 44 for furnishing of the annual return for the financial year to which the tax not paid relates:

Provided that no such assessment order shall be

passed without giving the person an opportunity of

being heard.

64.(1) The proper officer may, on any evidence showing Summary assess mentin

a tax liability of a person comingto his notice, with certain specia l cases.

the previous permission of Additional Commissioner

or Joint Commissioner, proceed to assess the tax

liability of such person to protect the interest of

revenue and issue an assessment order, if he has

sufficient grounds to believe that any delay in doing so may adversely affect the interest of revenue:

211

528 (210) Ree Usa, fet 12 FA 2017 Provided that where the taxable person to whom the liability pertains is not ascertainable and such liability pertains to supply of goods, the person in charge of such goods shall be deemed to be the taxable person liable to be assessed and liable to pay tax and any other amount due underthis section.

(2) On an application made by the taxable person within thirty days from the date of receipt of order passed under sub-section (1) or on his own motion, if the Additional Commissioner or Joint Commissioner considers that such order is erroneous, he may withdraw such order and follow the procedure laid down in section 73 or section 74.

CHAPTER XIII

AUDIT

65. (1) The Commissioner or any officer authorised by him, by way of a general or a specific order, may undertake audit of any registered person for such period, at such frequency and in such manner as may be prescribed.

(2) Theofficers referred to in sub-section (1) may conduct audit at the place of business of the registered person orin their office.

(3) The registered person shall be informed by way of a notice not less than fifteen working daysprior to the conduct of audit in such manner as may be prescribed.

(4) The audit under sub-section (1) shall be completed within a period of three months from the date of commencementofthe audit:

Provided that where the Commissioneris satisfied that audit in respect of such registered person cannot be completed within three months, he may, for the reasonsto be recorded in writing, extendthe period by a further - period not exceeding six months.

Audit by tax

authorities.

212

Heare wstaa, fers 12 3 2017 $28 (211) Explanation.—For the purposesofthis sub-section, the expression "commencementof audit" shall mean the date on which the records and other documents, called for by the tax authorities, are made available by the registered person or the actual institution of audit at the place of business, whicheverislater.

(5) During the course of audit, the authorised officer . may require the registered person,—

(i) to afford him the necessary facility to verify the books of account or other documents as he may require;

(ii) to furnish such information as he may require and render assistance for timely completion of the audit.

(6) On conclusion of audit, the proper officer shall, within thirty days, inform the registered person, whoserecords are audited, about the findings, his rights and obligations and the reasons for such findings.

(7) Where the audit conducted under sub-section (1)

66.

results in detection of tax not paid or short paid or erroneously refunded, or input tax credit wrongly availed or utilised, the proper officer may initiate action under section 73 or section 74.

(1) If at any stage of scrutiny, inquiry, investigation or any other proceedings before him, any officer not below the rank of Assistant Commissioner, having regard to the nature and complexity of the case and the interest of revenue, is of the opinion that the value has not been correctly declared or the credit availed is not within the normal limits, he may, with the prior approval of the Commissioner, direct such registered person by a communication in writing to get his records including books of account examined and audited by a chartered accountant or a cost accountant as may be nominated by the Commissioner.

(2) The chartered accountant or cost accountant so nominated shall, within the period of ninety days, submit a report of such audit duly signed and Special audit.

213

528 (212) Fee wT, FAH 12 FA 2017 certified by him to the said Assistant Commissioner mentioning therein such other particulars as may be specified:

Provided that the Assistant Commissioner may, on an application made to him in this behalf by the registered person or the chartered accountant or cost accountant or for any material and sufficient reason, extend the said period by a furtherperiod of ninety days.

(3) The provisions of sub-section (1) shall have effect. notwithstanding that the accounts of the registered person have been audited under any other provisions of this Act or any other law for the time being in force.

(4) The registered person shall be given an opportunity of being heard in respect of any material gathered on the basis of special audit under sub-section (1) which is proposed to be used in any proceedings against him under this Actor-the rules made thereunder.

(5) The expenses of the examination andaudit of records under sub-section (1), including the remuneration of such chartered accountant or cost accountant, shall be determined and paid by the Commissioner and such determination shall be final.

(6) Where the special audit conducted under sub- section (1) results in detection of tax not paid or. short paid or erroneously refunded, or input tax credit wrongly availed or utilised, the proper officer may initiate action under section 73 or section 74.

CHAPTER XIV

INSPECTION, SEARCH, SEIZURE AND ARREST

67. (1) Where the proper officer, not below the rank of Powerof inspection, Joint Commissioner, has reasons to believe that— search and seizure.

(a) a taxable person has suppressed any transaction relating to supply of goods or services or both or the stock of goods in hand,or has claimed input tax credit in excess of his entitlement under this Act or has

214

Hee UsTa, frie 12 FA 2017 528 (213) indulged in contravention of any of the provisions of this Act or the rules made thereunder to evade tax underthis Act; or

(b) any person engaged in the business of transporting goods or an owner or operator of a warehouse or a godown or any otherplace is keeping goods which have escaped paymentoftax or has kept his accounts or goods in such a mannerasis likely to cause evasion of tax payable underthis Act, he may authorise in writing any other officer ofState tax to inspect any places of business of the taxable person or the persons engaged in the business of transporting goods or the owner or the operator of warehouse or godownor any otherplace.

(2) Where the proper officer, not below the rank of Joint Commissioner, either pursuant to an inspection carried out under sub-section (1) or otherwise, has reasons to believe that any goods liable-to confiscation or any documents or books or things, which in his opinion shall be useful for or relevant to any proceedings under this Act, are secreted in any place, he may authorise in writing any other officer of State tax to search and seize or may himself search and seize such goods, documents or booksorthings:

Provided that where it is not practicable to seize any such goods, the properofficer, or any officer authorised by him, may serve on the owneror the custodian of the goods an order that he shall not remove, part with, or otherwise deal with the goods except with the previous permission ofsuchofficer:

Provided further that the documents or booksor things so seized shall be retained by such officer only for so long as may be necessary for their examination and for any inquiry or proceedings underthis Act.

(3) The documents, books or things referred to in sub- section (2) or any other documents, books or things produced by a taxable person or any other person, which have not been relied upon for the issue of notice under this Act or the rules made

215

528 (214) ^Heewa,feats^12FA2017 thereunder, shall be returned to such person within a period not exceedingthirty days of the issue of the said notice.

(4) The officer authorised under sub-section (2) shall have the powerto seal or break open the door of any premises or to break open any almirah, electronic devices, box, receptacle in which any goods, accounts, registers or documents of the person are suspected to be concealed, where access to such premises, almirah, electronic devices, box or receptacle is denied.

(5) The person from whose custody any documents are seized under sub-section (2) shall be entitled to make copies thereof or take extracts therefrom in the presence of an authorised officer at such place and time as such officer may indicate in this behalf except where making such copiesor taking such extracts may, in the opinion of the proper officer, prejudicially affect the investigation. —

(6) The goods so seized under sub-section (2) shall be released, on a provisional basis, upon execution of a bond and furnishing of a security, in such mannerand of such quantum,respectively, as may be prescribed or on payment of applicable tax, interest and penalty payable, as the case may be.

(7) Where any goodsare seized under sub-section (2) and no notice in respect thereofis given within six monthsofthe seizure of the goods, the goodsshall be returned to the person from whose possession they were seized:

Provided that the period of six months may, on sufficient cause being shown, be extended by the proper officer for a further period not exceeding six months.

(8) The Government may, having regard to the _ perishable or hazardous nature of any goods, depreciation in the value of the goods with the passage of time, constraints of storage space for the goods or any other relevant considerations, by notification, specify the goods or class of goods which shall, as soon as may be. after its seizure

216

Hee Usa, fete 12 FA 2017 under sub-section (2), be disposed of by the proper officer in such manner as may be prescribed.

(9) Where any goods, being goods specified under sub-section (8), have been seized by a proper officer, or any officer authorised by him under sub-section (2), he shall prepare an inventory of such goods in such manner as may be prescribed. 2 of 1974. (10) The provisions of the Code of Criminal Procedure, 1973, relating to search and seizure, shall, so faras may be, apply to search and seizure underthis section subject to the modification that sub-section (5) of section 165 of the said Code shall have effect as if for the word "Magistrate", wherever it occurs, the word "Commissioner"

were substituted.

(11) Where the properofficer has reasons to believe that any person has evaded or is attempting to evade the payment of any tax, he may, for reasons to be recorded in writing, seize the accounts, registers or documents of such person produced before him andshall grant a receipt for the same, and shall retain the same for so long as may be -hecessary in connection with any proceedings under this Act or the rules made thereunder for prosecution.

(12) The Commissioneror an officer authorised by

68.

him may cause purchase of any goodsor services or both by any person authorised by him from the business premises of any taxable person, to check the issue of tax invoices or bills of supply by such taxable person, and on return of goods so purchased by such officer, such taxable person or any person in charge of the business premises shall refund the amount so paid towards the goods after cancelling any tax invoice or bill of supply issued earlier.

(1) The Government may require the person in charge of a conveyance carrying any consignment of goods of value exceeding such amount as may bespecified to carry with him such documents and such devices as may beprescribed.

528 (215)

Inspection of goodsin movement.

217

528 (216)

2 of 1974. 5 of 1908 Heeger Ustaa, fei 12 YA 2017

(2) The details of documents required to be carried under sub-section(1) shall be validated in such manner as may beprescribed.

(3) Where any conveyancereferred to in sub-section

69.

' clause (a) or clause (b) or clause (c) or clause (d) of |

(1) is intercepted by the proper officer at any place, he may require the person in charge of the said conveyance to produce the documents prescribed under the said sub-section and devices for verification, and the said person shall be liable to produce the documents and devices and also allow the inspection of goods.

(1) Where the Commissioner has reasons to believe that a person has committed any offence specified in sub-section (1) of section 132 which is punishable under clause (i) or (ii) of sub-section (1), or sub- section (2) of the said section, he may, by order, authorise any officer of State tax to arrest such - person.

(2) Where a person is arrested under sub-section (1) for an offence specified under sub-section (5) of section 132, the officer authorised to arrest the person shall inform such person of the grounds of arrest and produce him before a Magistrate within twenty four hours.

(3) Subject to the provisions of the Code of Criminal Procedure, 1973,--

(a) where a person is arrested under sub-section (1) for any offence specified under sub-section (4) of section 132, he shall be admitted to bail or in default of bail, forwarded to the custody of the Magistrate;

(b) in the case of a non-cognizable and bailable offence, the Deputy Commissioneror the Assistant Commissionershall, for the purpose of releasing an arrested person on bail or otherwise, have the same powers and be subject to the same provisions as an officer-in-charge of a police station

70. (1) The properofficer under this Act shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry in the Powerto arrest.

Power to summon

personsto give

evidence and produce

documents.

218

45 of 1860. 18 of 2013. 43 of 1961. Heme usta, fetie 12 FA 2017 same manner, as provided in the case of a civil court under the provisions of the Code of Civil Procedure,

1908.

(2) Every such inquiry referred to in sub-section (1)

71.

shall be deemed to be a "judicial proceedings"

within the meaning of section 193 and section 228 ofthe Indian Penal Code.

(1) Any officer under this Act, authorised by the proper officer not below the rank of Joint Commissioner, shall have access to any place of business of a registered person to inspect books of account, documents, computers, computer programs, computer software whetherinstalled in a computer or otherwise and such other things as he may require and which may beavailable at such place, for the purposes of carrying out any audit, scrutiny, verification and checks as may be necessary to safeguard theinterest of revenue.

(2) Every person in charge of place referred to in sub- section (1) shall, on demand, make available to the officer authorised under sub-section (1) or the audit party deputed by the proper officer or a cost accountant or chartered accountant nominated under section 66,

(i) such records as prepared or maintained by the registered person and declared to the properofficer - in such manneras maybeprescribed;

(ii) trial balance or its equivalent;

(iii) statements of annual financial accounts, duly audited, wherever required;

(iv) cost audit report, if any, under section 148 of the Companies Act, 2013;

(v) the income-tax audit report, if any, under section 44ABofthe Income-tax Act, 1961; and

(vi) any other relevantrecord,

528 (217)

Access to business premises.

219

528 (218) Heme Uses, fers 12 FA 2017 for the scrutiny by the officer or audit party or the chartered accountant or cost accountant within a period not exceeding fifteen working days from the day when such demand is made, or such further period as may be allowed by the said officer or the audit party or the chartered accountant or cost accountant. 72.(1) Allofficers of Police, Railways, Customs, and Officers to assist proper those officers engaged in the collection of land

revenue, including village officers, officers of central tax and officers of the Unionterritory tax shall assist the proper officers in the implementation of this Act.

(2) The Government may, by notification, empower and require any other class of officers to assist the proper officers in the implementation of this Act when called upon to do so by the Commissioner.

CHAPTER XV

DEMANDS AND RECOVERY

73. (1) Where it appears to the properofficer that any tax has not been paid or short paid or erroneously refunded, or where input tax credit has been wrongly availed or utilised for any reason, other than the reason of fraud or any wilful misstatement or suppression of facts to evade tax, he shall serve notice on the person chargeable with tax which has not been so paid or which has been so short paid or to whom the refund has erroneously been made, or who has wrongly availed or utilised input tax credit, requiring him to show cause as to why he should not pay the amount specified in the notice along with interest payable thereon under section 50 and a penalty leviable under the provisions of this Act or the rules made thereunder.

(2) The proper officer shall issue the notice under sub-section (1) at least three months prior to the time limit specified in sub-section (10) for issuance oforder.

(3) Where a notice has been issued for any period under sub-section (1), the proper officer may serve a statement, containing the details of tax not paid or short paid or erroneously refunded or input officers.

Determination of tax

not paid orshort paid or

erroneously refunded or

input tax credit wrongly

availed or utilised for

any reason other than

fraud or any wilful

misstatement

suppression offacts.

or

220

Hee wT, fei 12 FA 2017 528 (219) tax credit wrongly availed or utilised for such periods other than those covered under sub- section (1), on the person chargeable with tax.

(4) The service of such statement shall be deemed to be service of notice on such person under sub- section (1), subject to the condition that the grounds relied upon for such tax periods other than those covered under sub-section (1) are the same as are mentionedin the earlier notice.

(5) The person chargeable with tax may, before service of notice under sub-section (1) or, as the case may be, the statement under sub-section (3), pay the amount of tax along with interest payable thereon under section 50 on the basis of his own ascertainment of such tax or the tax as ascertained by the proper officer and inform the proper officer in writing of such payment.

(6) The properofficer, on receipt of such information, shall not serve any notice under sub-section (1) or, as the case may be, the statement under sub- section (3), in respect of the tax so paid or any penalty payable under the provisions ofthis Act or the rules made thereunder.

(7) Where the properofficer is of the opinion that the amount paid under sub-section (5) falls short of the amount actually payable, he shall proceed to issue the notice as provided for in sub-section (1) in respect of such amount whichfalls short of the amountactually payable.

(8) Where any person chargeable with tax under sub- section (1) or sub-section (3) pays the said tax along with interest payable under section 50 within thirty days of issue of show cause notice, no penalty shall be payable and all proceedings in respect of the said notice shall be deemed to be concluded.

(9) The proper officer shall, after considering the representation, if any, made by person chargeable with tax, determine the amountoftax, interest and a penalty equivalent to ten per cent. of tax or ten

221

528 (220) Hee Usa, fea 12 FA 2017 thousand rupees, whichever is higher, due from such person and issue anorder.

(10) The properofficer shall issue the order under sub-section (9) within three years from the due date for furnishing of annual return for the financial year to which the tax not paid or short paid or input tax credit wrongly availed orutilised relates to or within three years from the date of erroneousrefund.

(11) Notwithstanding anything contained in sub-

74,

section (6) or sub-section (8), penalty under sub- section (9) shall be payable where any amount of self-assessed tax or any amount collected as tax has not been paid within a period of thirty days from the due date ofpayment of such tax.

(1) Where it appears to the proper officer that any tax has not been paid or short paid or erroneously refunded or where input tax credit has been wrongly availed or utilised by reason of fraud, or any wilful misstatement or suppression of facts to evade tax, he shall serve notice on the person chargeable with tax which has not been so paid or which has been so short paid or to whom the refund has erroneously been made, or who has wrongly availed orutilised input tax credit, requiring him to show cause as to why he should not pay the amount specified in the notice along with interest payable thereon under section 50 and a penalty equivalent to the tax specified in the notice.

(2) The proper officer shall issue the notice under sub-section (1) at least six months prior to the time limit specified in sub-section (10) for issuance of order.

(3) Where a notice has been issued for any period under sub-section (1), the proper officer may serve a statement, containing the details oftax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for such periods other than those covered under sub- section (1), on the person chargeable with tax. Determination of tax

not paid or short paid or

erroneously refunded or

input tax credit wrongly

availed or utilised by

reason of fraud or any

wilful misstatement or

suppression offacts.

222

Hee Usa, fai 12 BA 2017 528 (221)

(4) The service of statement under sub-section (3) shall be deemedto be service of notice under sub- section (1) of section 73, subject to the condition that the groundsrelied upon in the said statement, except the ground of fraud, or any wilful- misstatement or suppression of facts to evade tax, for periods other than those covered under sub- section (1) are the sameas are mentioned in the earlier notice.

(5) The person chargeable with tax may, before service of notice under sub-section (1), pay the amount of tax along with interest payable under section 50 and a penalty equivalent to fifteen per cent of such tax on the basis of his own ascertainment of such tax or the tax as ascertained by the properofficer and inform the properofficer in writing of such payment.

(6) The properofficer, on receipt of such information, shall not serve any notice under sub-section (1), in respect of the tax so paid or any penalty payable underthe provisions of this Act or the rules made thereunder.

(7) Where the properofficer is of the opinion that the amount paid under sub-section (5) falls short of the amount actually payable, he shall proceed to issue the notice as provided for in sub-section Q) in respect of such amount which falls short of the amountactually payable.

(8) Where any person chargeable with tax under sub- section (1) pays the said tax along with interest payable undersection 50 and a penalty equivalent to twenty five per cent of such tax within thirty days of issue of the notice, all proceedings in respect of the said notice shall be deemed to be concluded.

(9) The proper officer shall, after considering the representation, if any, made by the person chargeable with tax, determine the amount of tax, interest and penalty due from such person and issue an order.

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528 (222) HeqIe WaT, fete 12 FA 2017

(10) The proper officer shall issue the order under sub-section (9) within a period of five years from the due date for furnishing of annual return for the financial year to which the tax not paid or short paid or input tax credit wrongly availed orutilised relates to or within five years from the date of erroneous refund.

(11) Where any person served with an order issued under sub-section (9) pays the tax along with interest payable thereon under section 50 and a penalty equivalent to fifty per cent of such. tax within thirty days of communication of the order, all proceedings in respect of the said notice shall be deemed to be concluded.

Explanation 1.— For the purposes of section 73 and this section, ——

(i) the expression "all proceedings in respect of the said notice" shall not include proceedings under section 132;

(ii) where the notice under the same proceedings is issued to the main person liable to paytax and some other persons, and such proceedings against the main person have been concluded under section 73 or section 74, the proceedings against all the persons liable to pay penalty under sections 122, 125, 129 and 130 are deemed to be concluded.

Explanation 2.—For the purposes of this Act, the expression "suppression" shall mean non-declaration of facts or information which a taxable person is required to declare in the return, statement, report or any other document furnished under this Act or the rules made thereunder, or failure to furnish any information on being asked for, in writing, by the proper officer.

75. (1) Where the service of notice or issuance of orderis stayed by an order of a court or Appellate Tribunal, the period of such stay shall be excludedin computing the period specified in sub-sections (2) and (10) of section 73 or sub-sections (2) and (10) of section 74, as the case maybe.

General provisions

relating to

determination oftax.

224

Hee UT, fei 12 YA 2017 528 (223)

(2) Where any Appellate Authority or Appellate Tribunal or court concludes that the notice issued under sub-section (1) of section 74 is not sustainable for the reason that the charges of fraud or any wilful misstatement or suppression of facts to evade tax has not been established against the person to whom the notice wasissued, the proper officer shall determine the tax payable by such person, deeming asif the notice were issued under sub-section (1) of section 73.

(3) Where any order is required to be issued in pursuance of the direction of the Appellate Authority or Appellate Tribunal or a court, such order shall be issued within two years from the date of communication ofthe said direction.

(4) An opportunity of hearing shall be granted where a request is received in writing from the person chargeable with tax or penalty, or where any adverse decision is contemplated against such person.

(5) The proper officer shall, if sufficient cause is shown by the person chargeable with tax, grant time to the said person and adjourn the hearing for reasonsto be recorded in writing:

Provided that no such adjournmentshall be granted for more than three times to a person during the proceedings.

(6) The proper officer, in his order, shall set out the relevant facts and the basis of his decision.

(7) The amountoftax, interest and penalty demanded — in the order shall not be in excess of the amount specified in the notice and no demand shall be confirmed on the grounds other than the grounds specified in the notice.

(8) Where the Appellate Authority or Appellate Tribunal or court modifies the amount of tax determined by the proper officer, the amount of interest and penalty shall stand modified accordingly, taking into account the amount of tax so modified.

225

528 (224) Hee Usa, fea 12 FA 2017

(9) The interest on the tax short paid or not paid shall be payable whether or not specified in the order determiningthetax liability.

(10) The adjudication proceedings shall be deemed to be concluded,if the order is not issued within three years as provided for in sub-section (10) of section 73 or within five years as provided for in sub-section (10) of section 74.

(11) An issue on which the Appellate Authority or the Appellate Tribunal or the High Court has given its decision which is prejudicial to the interest of revenue in some other proceedings and an appeal to the Appellate Tribunal or the High Court or the Supreme Court against such decision of the Appellate Authority or the Appellate Tribunal or the High Court is pending, the period spent between the date of the decision of the Appellate Authority and that of the Appellate Tribunal or the date of decision of the Appellate Tribunal and that of the High Court or the date of the decision of the High Court and that of the Supreme Court shall be excluded in computing the period referred to in sub-section (10) of section 73 or sub-section (10) of section 74 where proceedings are initiated by way of issue of a show causenotice underthe said sections.

(12) Notwithstanding anything contained in section 73 or section 74, where any amount of self- assessed tax in accordance with a return furnished undersection 39 remains unpaid, either wholly or partly, or any amount of interest payable on such tax remains unpaid, the same shall be recovered underthe provisions of section 79.

(13) Where any penalty is imposed under section 73 or section 74, no penalty for the same act or omission shall be imposed on the same person under any other provision of this Act. 76.(1) Notwithstanding anything to the contrary Tax collected but not contained in any order or direction of any Appellate paid to Government. Authority or Appellate Tribunal or court or in any other provisions of this Act or the rules made

226

Reames wera, feat 12 FA 2017 528 (225) thereunder or any other law for the time being in force, every person who has collected from any other . person any amount as representing the tax under this Act, and has not paid the said amount to the Government, shall forthwith pay the said amount to the Government, irrespective of whether the supplies in respect of which such amount was collected are taxable or not.

(2) Where any amount is required to be paid to the Government under sub-section (1), and which has not been so paid, the proper officer may serve on the person liable to pay such amount a notice requiring him to show cause as to why the said amount as specified in the notice, should not be paid by him to the Government and why a penalty equivalent to the amount specified in the notice should not be imposed on him under the provisions of this Act.

(3) The proper officer shall, after considering the representation, if any, made by the person on whom the notice is served under sub-section (2), determine the amount due from such person and thereupon such person shall pay the amount so determined.

(4) The person referred to in sub-section (1) shall in addition to paying the amount referred to in sub- section (1) or sub-section (3) also be liable to pay interest thereon at the rate specified under section 50 from the date such amount was collected by him to the date such amountis paid by him to the Government.

(5) An opportunity of hearing shall be granted where a requestis received in writing from the person to whomthe notice was issued to show cause.

(6) The properofficer shall issue an order within one year from the date of issue of the notice.

(7) Where the issuance of order is stayed by an order of the court or Appellate Tribunal, the period of such stay shall be excluded in computing the period of one year.

227

528 (226) Hee Usa, frie 12 FA 2017

(8) The proper officer, in his order, shall set out the relevant facts and the basis of his decision.

(9) The amount paid to the Government under sub- section (1) or sub-section (3) shall be adjusted against the tax payable, if any, by the person in relation to the supplies referred to in sub-section

(1).

(10) Where any surplusis left after the adjustment under sub-section (9), the amount of such surplus shall either be credited to the Fund or refunded to the person who has borne the incidence of such amount. :

(11) . The person whohas borne the incidence of the amount, may apply for the refund of the same in accordance with the provisions of section 54. 77, (1) A registered person who has paid the central tax and State tax on a transaction considered by him to be an intra-State supply, but which is subsequently held to be an inter-State supply, shall be refunded' the amountoftaxes so paid in such mannerand subject to such conditions as may be prescribed.

(2) A registered person who has paid integrated tax on a transaction considered by him to be an inter- State supply, but which is subsequently held to be an intra-State supply, shall not be requiredto pay any interest on the amountof State tax payable.

78. Any amount payable by a taxable person in pursuance of an order passed underthis Act shall be paid by such person within a period of three months from the date of service of such order failing which recovery proceedingsshall be initiated:

Provided that where the proper officer considers it expedient in the interest of revenue, he may, for reasons to be recorded in writing, require the said taxable person to make such payment within such period less than a period of three months as maybe specified by him. Tax wrongfully

collected and paid to

Central Governmentor

State Government.

Initiation of recovery

proceedings.

228

Fee wea, feats 12 YF 2017 528 (227) 79.(1) Where any amount payable by a person to the Recovery oftax. Government under anyofthe provisions ofthis Act or the rules made thereunder is not paid, the proper officer shall proceed to recover the amount by one or moreofthe following modes, namely:—

(a) the proper officer may deduct or may require — any other specified officer to deduct the amount so payable from any money owing to such person which may be under the control of the proper officer or such other specified officer;

(b) the proper officer may recover or may require any other specified officer to recover the amount so payable by detaining and selling any goods belonging to such person which are under the control of the properofficer or such other specified officer;

(c) (i) the proper officer may, by a notice in writing, require any other person from whom moneyis due or may become due to such person or who holds or may subsequently hold money for or on account of such person, to pay to the Government either forthwith upon the money becoming dueor being held, or within the time specified in the notice not being before the money becomesdueor is held, so much of the money as is sufficient to pay the amount due from such person or the whole of the money whenit is equal to or less than that amount;

(ii) every person to whom the notice is issued under sub-clause (i) shall be bound to comply with such notice, and in particular, where any such notice is issued to a post office, banking company or an insurer, it shall not be necessary to produce any pass book, deposit receipt, policy or any other document for the purpose of any entry, endorsement or the like being made before payment is made, notwithstanding any rule, practice or requirementto the contrary;

(iii) in case the person to whom a notice under sub-clause (i) has been issued, fails to make the payment in pursuance thereof to the Government, he shall be deemed to be a defaulter in respect of the amount specified in the notice and all the

229

528 (228)

AeqreR^Usa,fetish^12FA2017 consequences of this Act or the rules made thereundershall follow;

(iv) the officer issuing a notice under sub- clause (i) may, at any time, amend or revoke such notice or extend the time for making any payment in pursuance ofthe notice;

(v) any person making any payment in compliance with a notice issued under sub-clause

(i) shall be deemed to have made the payment under the authority of the person in default and such payment being credited to the Government shall be deemed to constitute a good and sufficient discharge of the liability of such person to the person in default to the extent of the amount specified in the receipt;

(vi) any person discharging anyliability to the person in default after service on him ofthe notice issued under sub-clause (i) shall be personally liable to the Government to the extent of the liability discharged or to the extent of the liability of the person in default for tax, interest and penalty, whicheveris less;

(vii) where a person on whom anotice is served under sub-clause(i) proves to the satisfaction ofthe officer issuing the notice that the money demanded or any part thereof was not due to the person in default or that he did not hold any moneyfor or on account of the person in default, at the time the notice was served on him, nor is the money demandedoranypart thereof,likely to become due to the said person or be held for or on account of such person, nothing contained in this section shall be deemed to require the person on whom the notice has been served to pay to the Government any such moneyorpart thereof;

(d) the proper officer may, in accordance with the rules to be made in this behalf, distrain any movable or immovable property belonging to or under the control of such person, and detain the same until the amount payable is paid; and in case, any part of the said amount payable orofthe costof the distress or keeping

230

2 of 1974,. Hear wera, fests 12 BA 2017 of the property, remains unpaid for a period of thirty days next after any such distress, may cause the said property to be sold and with the proceedsofsuchsale, maysatisfy the amount payable andthecosts including cost of sale remaining unpaid and shall render the surplus amount, if any, to such person;

(e) the proper officer may prepare a certificate signed by him specifying the amount due from such person and send it to the Collector of the district in which such person owns any property or resides or carries on his business or to any officer authorised by the Government and the said Collector or the said officer, on receipt of such certificate, shall proceed to recover from such person the amount specified thereunderas if it were an arrear of land revenue;

(f) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, the proper officer may file an application to the appropriate Magistrate and such Magistrate shall proceed to recover from such person the amount specified thereunder as if it were a fine imposed by him.

. (2) Where the terms of any bond or other instrument executed under this Act or any rules or regulations made thereunder provide that any amount due under such instrument may be recovered in the manner laid down in sub-section (1), the amount may, without prejudice to any other mode of recovery, be recovered in accordance with the provisions of that sub-section.

(3) Where any amount of tax, interest or penalty is payable by a person to the Government under any of the provisions of this Act or the rules made thereunder and which remains unpaid, the proper officer of central tax, during the course of ' recovery of said tax arrears, may recover the amount from the said person asif it were an arrear of central tax and credit the amount so recovered to the account of the Government.

(4) Where the amount recovered under sub-section

(3) is less than the amount due to the Central Governmentand State Government, the amount to

528 (229)

231

528 (230)

31 of 2016 Hegre Usa, Tea 12 FA 2017 be credited to the account of the respective Governmentsshall be in proportion to the amount due to each such Government.

80. On an application filed by a taxable person, the Commissioner may, for reasons to be recorded in writing, extend the time for payment or allow payment of any amount due under this Act, other than the amount due as per the liability self-assessed in any return, by such person in monthly instalments not exceeding twenty four, subject to payment ofinterest under section 50 and subject to such conditions and limitations as may be prescribed:

Provided that where there is default in payment of any one instalment on its due date, the whole outstanding balance payable on such date shall become due and payable forthwith and shall, without any further notice being served on the-person,be liable for recovery.

81. Where a person, after any amount has become due from him, creates a charge on or parts with the property belonging to him or in his possession by way of sale, mortgage, exchange, or any other mode of transfer whatsoever of any of his properties in favour of any other person with the intention of defrauding the Governmentrevenue, such charge ortransfer shall be void as against any claim in respect of any tax or any other sum payablebythe said person:

Provided that, such charge ortransfer shall not be void if it is made for adequate consideration, in good faith and without notice of the pendency of such proceedings under. this Act or without notice of such tax or other sum payable by the said person, or with the previous permission of the properofficer.

82. Notwithstanding anythingto the contrary contained in any law for the time being in force, save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, any amount payable by a taxable person or any other person on account of tax, interest or penalty . whichheis liable to pay to the Government shall be a first charge on the property of such taxable person or such person.

Paymentof tax and

other amount in

instalments.

Transfer ofproperty to

be void in certain cases.

Tax to befirst charge

on property.

232

Heme usta, fear 12 YA 2017 §28 (231) 83.(1) Where during the pendency of any proceedings Provisional attachment undersection 62 or section 63 or section 64 or section to protect revenue in 67 or section 73 or section 74, the Commissioneris of certain cases. the opinion that for the purpose of protecting the

interest of the Government revenue, it is necessary so to do, he may, by order in writing attach provisionally any property, including bank account, belonging to the taxable person in such manner as may beprescribed.

(2) Every such provisional attachment shall cease to

84.

have effect after the expiry of a period of one year from the date of the order made under sub-section

(1).

Where any notice of demand in respect of any tax, Continuation and penalty, interest or any other amount payable under validation ofcertain _this Act, (hereafter in this section referred to as recovery proceedings.

"Government dues"), is served upon any taxable person or any other person and any appeal or revision application is filed or any other proceedings is initiated in respect of such Government dues, then—

(a) where such Government dues are enhanced in such appeal, revision or other proceedings, the Commissioner shall serve upon the taxable person or any other person another notice of demand in respect of the amount by which such Government dues are enhanced and any recovery proceedingsin relation to such Government dues as are covered by the notice of demand served upon him before the disposal of such appeal, revision or other proceedings may, without the service of any fresh notice of demand, be continued from the stage at which such proceedings stood immediately before such disposal;

(b) where such Government dues are reduced in such appeal, revision or in other proceedings—

(i) it shall not be necessary for the Commissioner to serve upon the taxable person a fresh notice of demand;

(ii) the Commissioner shall give intimation of such reduction to him and to the appropriate authority with whom recovery proceedings is pending;

233

528 (232) Regge Usa, fetie 12 WAI 2017

(iii) any recovery proceedings initiated on the basis of the demand served upon him prior to the disposal of such appeal, revision or other proceedings may be continued in relation to the amount so reduced from the stage at which such proceedings stood immediately before such disposal.

CHAPTER XVI

LIABILITY TO PAY IN CERTAIN CASES

85. (1) Where a taxable person, liable to pay tax under Liability in case of this Act, transfers his business in whole or in part, by transfer of business. sale, gift, lease, leave andlicense, hire or in any other manner whatsoever, the taxable person and the person

to whom the business is so transferred shall, jointly

and severally, be liable wholly or to the extent of such - transfer, to pay the tax, interest or any penalty due

from the taxable person upto the time of suchtransfer, whether such tax, interest or penalty has been

determined before such transfer, but has remained

unpaid or is determinedthereafter.

(2) Where the transferee of a business referred to in sub-section (1) carries on such business either in his own nameor in some other name, he shall be liable to pay tax on the supply of goods or services or both effected by him with effect from the date of such transfer and shall, if he is a registered person underthis Act, apply within the prescribed time for amendmentof his certificate of registration.

86. Wherean agent supplies or receives any taxable goods Liability of agent and on behalf ofhis principal, such agent andhis principal _ principal. shall, jointly and severally, be liable to pay the tax

payable on such goods underthis Act.

87. (1) When two or more companies are amalgamated or Liability in case of merged in pursuance of an order of court or of amalgamation or Tribunal or otherwise and the order is to take effect merger of companies. from a date earlier to the date of the order and any two or more of such companies have supplied or received

any goods or services or both to or from each other

234

Hee Usa, fete 12 FA 2017 528 (233) during the period commencingon the date from which the order takes effect till the date of the order, then such transactions of supply and receipt shall be included in the turnover of supply or receipt of the respective companies and they shall be liable to pay tax accordingly.

(2) Notwithstanding anything contained in the said order, for the purposes ofthis Act, the said two or more companies shall be treated as distinct companiesfor the period up to the date of the said order and the registration certificates of the said companies shall be cancelled with effect from the- date of the said order.

88. (1) When any company is being wound up whether under the orders of a court or Tribunal or otherwise, every person appointed as receiver of any assets of a company (hereafter in this section referred to as the

"liquidator"), shall, within thirty days after his appointment, give intimation of his appointmentto the Commissioner.

(2) The Commissioner shall, after making such inquiry or calling for such information as he may deem fit, notify the liquidator within three months from the date on which he receives intimation of the appointment of the liquidator, the amount which in the opinion of the Commissioner would be sufficient to provide for any tax, interest or penalty which is then, or is likely thereafter to become, payable by the company.

(3) When any private company is wound up and any tax, interest or penalty determined under this Act on the companyfor any period, whetherbeforeor in the courseof or afterits liquidation, cannot be

"fééovetéd, thenEvery person who wasa director of such company at any time during the period for which the tax was due shall, jointly and severally, be liable for the payment of such tax, interest or - penalty, unless he proves to the satisfaction of the Commissioner that such non-recovery cannot be attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the affairs of the company.

Liability in case of

companyin liquidation.

235

528 (234) ^{FeeUsa,feat12YA2017} 18 of 2013. 89.(1) Notwithstanding anything contained in the Liability of dir ectors of

Companies Act, 2013, where any tax, interest or

penalty due from a private companyin respect of any

supply of goods or services or both for any period

cannot be recovered, then, every person who was a

director of the private company during such period

shall, jointly and severally, be liable for the payment of such tax, interest or penalty unless he proves that the non-recovery cannot be attributed to any gross

neglect, misfeasance or breach of duty on his part in

relation to the affairs of the company.

(2) Where a private company is converted into a public company andthe tax, interest or penalty in respect of any supply of goods or services or both for any period during which such company was a private company cannot be recovered before such. conversion, then, nothing contained in sub-section

(1) shall apply to any person who wasa director of such private company in relation to any tax, interest or penalty in respect of such supply of goods or services or both of such private company:

Provided that nothing contained in this sub-section shall apply to any personal penalty imposed on such director.

90. Notwithstanding any contract to the contrary and. any other law for the time being in force, where any firm is liable to pay any tax, interest or penalty under this Act, the firm and each ofthe partners of the firm shall, jointly and severally, be liable for such payment:

Provided that where any partner retires from the firm, he or the firm, shall intimate the date of retirementof the said partner to the Commissioner by a notice in that behalf in writing and such partner shall be liable to pay tax, interest or penalty due upto the date of his retirement whether determined or not, on that date:

Provided further that if no such intimation is given within one month from the date of retirement, the liability of such partner under the first proviso shall continue until the date on which such intimation is received by the Commissioner.

private company.

Liability of partners of

firm to pay tax.

236

Hee Usa, fete 12 FA 2017 ⁵²⁸(235) 31 of 2016

91,

92.

93.

Where the business in respect of which any tax, interest or penalty is payable under this Act is carried on by any guardian, trustee or agent of a minor or other incapacitated person on behalf of and for the benefit of such minor or other incapacitated person, the tax, interest or penalty shall be levied upon and recoverable from such guardian, trustee or agent in like manner and to the same extent as it would be determined and recoverable from any such minor or other incapacitated person, as if he were a major or capacitated person and as if he were conducting the business himself, and all the provisions of this Act or the rules made thereundershall apply accordingly. Where the estate or any portion of the estate of a taxable person owning a business in respect of which any tax, interest or penalty is payable under this Actis under the control of the Court of Wards, the Administrator General, the Official Trustee or any receiver or manager (including any person, whatever be his designation, who in fact manages the business) appointed by or under any order of a court, the tax, interest or penalty shall be levied upon and be recoverable from such Court of Wards, Administrator General, Official Trustee, receiver or manager in like manner and to the same extent as it would be determined and be recoverable from the taxable person as if he were conducting the business himself, and all the provisions of this Act or the rules made thereundershall apply accordingly.

(1) Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, where a person, liable to pay tax, interest or penalty underthis Act, dies, then—

(a) if a business carried on by the person is continued after his death by his legal representative or any other person, such legal representative or other person, shall be liable to pay tax, interest or penalty due from such person underthis Act; and

(b) if the business carried on by the person is discontinued, whether before or after his death, his legal representative shall be liable to pay, out of the estate of the deceased, to the extent to which the estate is capable of meeting the charge, the tax, interest or penalty due from such person underthis Act,

Liability of guardians,.

trustees etc.

Liability of Court of

Wards,etc.

Special provisions

regarding liability to

pay tax, interest or

penalty in certain cases.

237

528 (236) Hee UTA, fea 12 YA 2017 31 of 2016

31 of 2016

31 of 2016

whether such tax, interest or penalty has been determined before his death but has remained unpaid or is determined after his death.

(2) Save as otherwiseprovided in the Insolvency and Bankruptcy Code, 2016, where a taxable person, liable to pay tax, interest or penalty under this Act, is a Hindu Undivided Family or an association of persons and the property of the Hindu Undivided Family or the association of personsis partitioned amongst the various members or groups of members, then, each member or group of membersshall, jointly and severally, be liable to pay the tax, interest or penalty due from the taxable person under this Act upto the time ofthe partition whether such tax, penalty or interest has been determined before partition but has remained unpaid or is determinedafter the partition.

(3) Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, where a taxable person, liable to pay tax, interest or penalty underthis Act, is a firm, and the firm is dissolved, then, every person who was a partner shall, jointly and severally, be liable to pay the tax, interest or penalty due from the firm under this Act upto the time of dissolution whether such tax, interest or penalty has been determined before the dissolution, but has remained unpaid or is determined after dissolution.

(4) Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, where a taxable person liable to pay tax, interest or penalty under this Act,—

(a) is the guardian of a ward on whose behalf the business is carried on by the guardian;or

(b) is a trustee who carries on the business under a trust for a beneficiary,

then, if the guardianship ortrust is terminated,the ward or the beneficiary shall be liable to pay the tax, interest or penalty due from the taxable person upto the time of the termination of the guardianshiportrust, whether suchtax,

238

Heqre teas, fete 12 FA 2017 interest or penalty has been determined before the termination of guardianship or trust but has remained unpaid or is determined thereafter.

94, (1) Where a taxable personis a firm or an association of persons or a Hindu Undivided Family and such firm, association or family has discontinued business—

(a) the tax, interest or penalty payable under this Act by such firm,association or family upto the date of such discontinuance may be determined as if no such discontinuance had taken place; and

(b) every person who, at the time of such discontinuance, was a partner of such firm, or a member of such association or family, shall, notwithstanding such discontinuance, jointly and severally, be liable for the payment of tax and interest determined and penalty imposed and payable by such firm, association or family, whether such tax and interest has been determined or penalty imposed prior to or after such discontinuance and subject as aforesaid, the provisions of this Act shall, so far as may be, apply as if every such person or partner or memberwere himself a taxable person.

(2) Where a change has occurred in the constitution of a firm or an association of persons, the partners of the firm or membersof association, as it existed before and as it exists after the reconstitution, shall, without prejudice to the provisions of section 90, jointly and severally, be liable to pay tax, interest or penalty due from such firm or association for any period before

_

its

reconstitution.

(3) The provisions of sub-section (1) shall, so far as may be, apply where the taxable person, being a firm or association of persons is dissolved or where the taxable person, being a Hindu Undivided Family, has effected partition with _ respect to the business carried on by it and accordingly references in that sub-section to discontinuance shall be construed as reference to dissolution or to partition.

528 (237)

Liability in other cases.

239

528 (238) Hee tsa, fet 12 YA 2017 Explanation.—Forthe purposes of this Chapter,—

(i) a "Limited Liability Partnership" formed and registered underthe provisions of the Limited Liability 6 of 2009. Partnership Act, 2008 shall also be considered as a firm;

(ii) "court" means the District Court, High Court or - Supreme Court,

CHAPTERXVII

ADVANCE RULING

95.In this Chapter, unless the context otherwise Definitions. requires,—

(a) "advance ruling" means adecision provided by the Authority or the Appellate Authority to an applicant on matters or on questions specified in sub-section (2) of section 97 or sub-section (1) of section 100, in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant;

(b) "Appellate Authority" means the Appellate Authority for Advance Ruling constituted undersection 99;

(c) "applicant" means any person registered or desirous of obtaining registration under this Act;

(d) "application" means an application madeto the Authority under sub-section (1) of section 97;

(e) "Authority" means the Authority for Advance Ruling, constituted under section 96.

96. (1) The Government shall, by notification, constitute Constitution of an Authority to be known as the Madhya Pradesh Authority for Advance Authority for Advance Ruling: Ruling.

240

eae Us, feria 12 YA 2017 528 (239) Provided that the Government may, on the recommendation of the Council, notify any Authority located in another State to act as the Authority for the State.

(2) The Authority shall consist of-

(i) one member from amongst the officers of central tax; and

(ii) one member from amongst the officers of State tax, to be appointed by the Central Governmentand the State Government respectively.

(3) The qualifications, the method of appointment of the members and the terms and conditions of their services shall be such as may be prescribed.

97.(1) An applicant desirous of obtaining an advance ruling under this Chapter may make an application in such form and manner and accompanied by such fee as may be prescribed, stating the question on which the advanceruling is sought.

(2) The question on which the advance ruling is sought underthis Act, shall be in respectof, -

(a) classification of any goodsor services or both;

(b) applicability of a notification issued under the provisionsof this Act;

(c) determination of time and value of supply of goodsor Services or both;

(d) admissibility of input tax credit of tax paid or deemedto have been paid;

(e) determination of the liability to pay tax on any goodsorservices or both;

(f) whether applicant is required to be registered;

(g) whether any particular thing done by the applicant with respect to any goods or services or both amounts to or results in a supply of goodsor services or both, within the meaning of that term.

Application for advance

ruling.

241

528 (240)

Hegre Usraa, feaiH^12FA2017

98. (1) On receipt of an application, the Authority shall Procedure on receipt of cause a copy thereof to be forwarded to'the concerned application. officer and, if necessary, call upon him to furnish the

relevant records:

Provided that where any records have been called

for by the Authority in any case, such records shall, as soon as possible, be returned to the said concernedofficer.

(2) The Authority may, after examining the application and the records called for and after hearing the applicant or his authorised representative and the concerned officer or his authorised representative, by order, either admit or reject the application:

Provided that the Authority shall not admit the application where the question raised in the application is already pending or decided in any proceedings in the case of an applicant under any of the provisions of this Act:

Provided further that no application shall be rejected underthis sub-section unless an opportunity of hearing has been givento the applicant:

Provided also that where the application is rejected, the reasons for such rejection shal! be specified in the order.

(3) A copy of every order made under sub-section (2) shall be sent to the applicant and to the concerned officer.

(4) Where an application is admitted under sub- section (2), the Authority shall, after examining such further material as may be placed beforeit by the applicant or obtained by the Authority and after providing an opportunity of being heard to the applicant or his authorised representative as well as to the concerned officer or his authorised representative, pronounce its advance ruling on the question specified in the application.

(5) Where the members of the Authority differ on any question on which the advance ruling is sought,

242

Hee usta, feats 12 FA 2017 they shall state the point or points on which they differ and makea reference to the Appellate Authority for hearing and decision on such question.

(6) The Authority shall pronounce its advance ruling in writing within ninety days from the date of receipt of application.

(7) A copy of the advance ruling pronounced by the Authority duly signed by the members and certified in such manner as may be prescribed shall be sent to the applicant, the concerned officer and the jurisdictional officer after such pronouncement.

99. The Governmentshall, by notification, constitute an Authority to be known as Madhya Pradesh Appellate Authority for Advance Ruling for Goods and Services Tax for hearing appeals against the advance ruling pronounced by the Advance Ruling Authority:

Provided that the Government may, on the recommendations ofthe Council, notify any Appellate Authority located in another State or Union territory to act as theAppellate Authority for the State.

100. (1) The concernedofficer, the jurisdictional officer or an applicant aggrieved by any advance ruling pronounced under sub-section (4) of section 98, may appeal to the Appellate Authority.

(2) Every appeal under this section shall be filed within a period of thirty days from the date on which the ruling sought to be appealed against is communicated to the concerned officer, the jurisdictional officer and the applicant:

Provided that the Appellate Authority may, if it is satisfied that the appellant was prevented by a sufficient cause from presenting the appeal within the said period of thirty days, allow it to be presented within a further period not exceeding thirty days.

(3) Every appeal under this section shall be in such form, accompanied by such fee and verified in such manneras may be prescribed.

528 (241)

Constitution of Appellate Authority for Advance Ruling.

Appeal to the Appellate Authority.

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528 (242) Reage Uses, fer 12 FA 2017

101. (1) The Appellate Authority may, after giving the Orders of Appellate parties to the appeal or reference an opportunity of Authority. being heard, pass such order as it thinks fit,

confirming or modifying the ruling appealed against

or referred to.

(2) The order referred to in sub-section (1) shall be passed within a period of ninety days from the date offiling of the appeal under section 100 or a reference under sub-section (5) ofsection 98.

(3) Where the members of the Appellate Authority differ on any pointor points referred to in appeal or reference, it shall be deemed that no advance ruling can be issued in respect of the question underthe appeal or reference.

(4) A copy of the advance ruling pronounced by the Appellate Authority duly signed by the Members and certified in such manner as maybeprescribed shall be sent to the applicant, the concerned officer, the jurisdictional officer and to the Authority after such pronouncement.

102. The Authority or the Appellate Authority may amend any order passed by it under section 98 or section 101, so as to rectify any error apparent on the face of the record, if such error is noticed' by the Authority or the Appellate Authority on its own accord, or is brought to its notice by the concerned officer, the jurisdictional officer, or the applicant or . the appellant within a period of six months from the date ofthe order:

Provided that no rectification which has the effect of enhancing the tax liability or reducing the amount of admissible input tax credit shall be made unless the applicant or the appellant has been given an opportunity of being heard.

103. (1) Theadvance ruling pronounced by the Authority or the Appellate Authority under this Chapter shall be binding only -

(a) on the applicant who had soughtit in respect of any matter referred to in sub-section (2) of section 97 for advanceruling;

Rectification of

advanceruling.

Applicability

advanceruling.

- of

244

FIN Usa, fea12 YA 2017

(b) on the concerned officer or the jurisdictional officer in respect of the applicant.

(2) The advance ruling referred to in sub-section (1) shall be binding unless the law, facts or circumstances supporting the original advance ruling have changed.

104. (1) Where the Authority or the Appellate Authority finds that advance ruling pronouncedbyit under sub-section (4) of section 98 or under sub- section (1) of section 101 has been obtained by the applicant or the appellant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab-initio and thereupon all the provisions of this Act or the rules made thereunder shall apply to the applicant or the appellant as if such advance ruling had never been made:

Provided that no order shall be passed underthis sub-- section unless an opportunity of being heard has been given to the applicant or the appellant. Explanation.—The period beginning with the date of *such advance ruling and ending with the date of order ' under this sub-section shall be excluded while computing the period specified in sub-sections (2) and (10) of section 73 or sub-sections (2) and (10) of section 74.

(2) A copy of the order made under sub-section (1) shall be sent to the applicant, the concerned officer and the jurisdictional officer.

105. (1) The Authority or the Appellate Authority shall, for the purpose of exercising its powers regarding —

(a) discovery and inspection;

(b) enforcing the attendance of any person and examining him on oath;

(c) issuing commissions and compelling production of books of account and otherrecords, 5 of 1908. have all the powers of a civil court under the Code of Civil Procedure, 1908.

528 (243)

Advance ruling to be void in certain circumstances. Powers of

and

Authority.

Authority ©

Appellate

245

528 (244)

2 of 1974. 45 of 1860. Ree Usa, feats 12 FA 2017

(2) The Authority or the Appellate Authority shall be deemed to be a civil court for the purposes of section 195, but not for the purposes of Chapter XXVI of the Code of Criminal Procedure, 1973, and every proceeding before the Authority or the Appellate Authority shall be deemed to be a judicial proceedings within the meaning of sections 193 and 228, and for the purpose of section 196 of the Indian Penal Code.

106. The Authority or the Appellate Authority shall, subject to theprovisions of this Chapter, have power to regulate its own procedure.

CHAPTERXVIII

APPEALS AND REVISION

107. (1) Any person aggrieved by any decision or order passed under this Act or the Central Goods and Services Tax Act by an adjudicating authority may appeal to such Appellate Authority as may be prescribed within three months from the date on which the said decision or order is communicated to such person.

(2) The Commissioner may, on his own motion, or upon request from the Commissioner of central tax, call for and examine the record of any proceeding in which an adjudicating authority has passed any decision or order under this Act or the Central Goods and Services Tax Act, for the purpose ofsatisfying himself as to the legality or propriety ofthe said decision or order and may, by order, direct any officer subordinate to him to apply to the Appellate Authority within six months from the date of communication of the said decision or order for the determination of such points arising out of the said decision or order as may be specified by the Commissionerin his order.

(3) Where, in pursuance of an order under sub-section (2), the authorised officer makes an application to the Appellate Authority, such application shall be dealt with by the Appellate Authority as if it were Procedure of Authority

and Appellate

Authority.

Appeals to Appellate

Authority.

246

Heme Usa, fei 12 FA 2017 an appeal made against the decision or order of the adjudicating authority and such authorised officer were an appellant and the provisions of this Act relating to appeals shall apply to such application.

(4) The Appellate Authority may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of three months or six months, as the case may be,allow it to be presented within a further period of one month.

(5) Every appeal under this section shall be in such form and shall be verified in such manner as may be prescribed.

(6) No appeal shall be filed under sub-section (1), unless the appellant has paid —

(a) in full, such part of the amountoftax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him; and

(b) a sum equal to ten per cent of the remaining amountoftax in dispute arising from the said order, in relation to which the appeal has beenfiled.

(7) Where the appellant has paid 'the amount under sub-section (6), the recovery proceedings for the balance amountshall be deemed to be stayed.

(8) The Appellate Authority shall give an opportunity to the appellant of being heard.

(9) The Appellate Authority may, if sufficient cause is shown at any stage of hearing of an appeal, -grant time. to the parties or any of them and adjourn the hearing of the appeal for reasons to be | recordedin writing:

Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal.

528 (245)

247

528 (246) eI waa, feats 12 FA 2017

(10) The Appellate Authority may, at the time of hearing of an appeal, allow an appellant to add any ground of appeal not specified in the grounds of appeal,if it is satisfied that the omission of that ground from the grounds of appeal wasnot wilful or unreasonable.

(11) The Appellate Authority shall, after making such further inquiry as may be necessary, pass such order, as it thinks just and proper, confirming, modifying or annulling the decision or order appealed against but shall not refer the case back to the adjudicating authority that passed the said decision or order:

Provided that an order enhancing any fee or penalty or fine in lieu of confiscation or confiscating goods of greater value or reducing the amount of refund or input tax credit shall not be passed unless the appellant has been given a reasonable opportunity of showing cause against the proposed order:

Provided further that where the Appellate Authority is of the opinion that any tax has not been paid or short-paid or erroneously refunded, or where input tax credit has been wrongly availed orutilised, no order requiring the appellant to pay such tax or input tax credit shall be passed unless the appellantis given notice to show cause against the proposed order and the order is passed within the time limit specified under section 73 or section 74.

(12) The order of the Appellate Authority disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reasons for such decision.

(13) The Appellate Authority shall, where it is possible to do so, hear and decide every appeal within a period of one year from the date on whichit is filed:

Provided that where the issuanceoforderis stayed by an order ofa court or Tribunal, the period of such stay shall be excluded in computing the period of one year.

248

Hee usa, fete 12 A 2017

(14) On disposal of the appeal, the Appellate Authority shall communicate the order passed by it to the appellant, respondent and to the adjudicating authority. .

(15) A copy of the order passed by the Appellate Authority shall also be sent to the Commissioner or the authority designated by him in this behalf and the jurisdictional Commissioner of central tax or an authority designated by him in this behalf.

(16) Every order passed under this section shall, subject to the provisions of section 108 or section 113 or section 117 or section 118 be final and binding on the parties.

108. (1) Subject to the provisions of section 121 and any rules made thereunder, the Revisional Authority may, on his own motion, or upon information received by him or on request from the Commissioner of 'central tax, call for and examine the record of any proceedings, and if he considers that any decision or order passed under this Act or under the Central Goods and Services Tax Act by any officer subordinate to him is erroneous in so far as it is prejudicial to the interest of revenue and is illegal or improper or has not taken into account certain material facts, whether available at the time of issuance of the said order or not or in consequence of an observation by the Comptroller and Auditor General of India, he may, if necessary, stay the operation of such decision or order for such period as he deemsfit and after giving the person concerned an opportunity of being heard and after making such | further inquiry as may be necessary, pass such order, as he thinks just and proper, including enhancing or modifying or annulling the said decision or order.

(2) The Revisional Authority shall not exercise any powerundersub-section (1), if— '

(a) the order has been subject to an appeal under section 107 or section 112 or section 117 or section 118; or.

528 (247)

Powers of Revisional Authority.

249

528 (248) Reger Usa, feqie 12 FA 2017

(b) the period specified under sub-section (2) of section 107 has not yet expired or more than three _ years have expired after the passing of the decision or order sought to be revised; or

(c) the order has already been taken for revision under this section at an earlier stage; or

(d) the order has been passed in exercise of the powers undersub-section (1):

Provided that the Revisional Authority may pass an order under sub-section (1) on any point which has not been raised and decided in an appeal referred to in clause (a) of sub-section (2), before the expiry of a period of one year from the date of the order in such appeal or before the expiry of a period of three years referred to in clause (b) of that sub-section, whichever is later.

(3) Every order passed in revision under sub-section

(1) shall, subject to the provisions of section 113 or section 117 or section 118, be final and binding on the parties.

(4) If the said decision or order involves an issue on which the Appellate Tribunal or the High Court has given its decision in some other proceedings and an appeal to the High Court or the Supreme Court against such decision of the Appellate Tribunal or the High Court is pending, the period spent between the date of the decision of the Appellate Tribunal and the date of the decision of the High Court or the date of the decision of the High Court and the date of the decision of the Supreme Court shall be excluded in computing the period of limitation referred to in clause (b) of sub-section (2) where proceedings for revision have been initiated by way of issue of a notice underthis section.

(5) Where the issuance of an order under sub-section

(1) is stayed by the order of a court or Appellate Tribunal, the period of such stay shall be excluded in computing the period oflimitation referred to in clause (b) of sub-section (2). °

250

5 of1908. 5 of 1908. Hegre Usa, fea 12 VA 2017

(6) For the purposesofthis section, the term,—

(i) "record" shall include all records relating to any proceedings under this Act available at the time of examination by the Revisional Authority;

(ii) "decision" shall include intimation given by any officer lower in rank than the Revisional Authority.

109. (1) Subject to the provisions of this Chapter, the Goods and Services Tax Tribunal constituted under the Central Goods and Services Tax Act shall be the Appellate Tribunal for hearing appeals against the orders passed by the Appellate Authority or the Revisional Authority under this Act.

(2) The constitution and jurisdiction of the State Bench and the Area Bencheslocated in the State shall be in accordancewith the provisionsof section 109 of the Central Goods and Services Tax Act or the rules made thereunder,

110. The qualifications, appointment, salary and allowances, terms of office, resignation and removal of the President and Members of the State Bench and Area Benches shall be in accordance with the provisions of section 110 of the Central Goods and Services Tax Act.

111. (1) The Appellate Tribunal shall. not, while disposing of any proceedings before it or an appeal before it, be bound by the procedure laid down in the Code of Civil Procedure, 1908, but shall be guided by the principles of natural justice and subject to the other provisions of this Act and the rules made thereunder, the Appellate Tribunal shall have powerto regulate its own procedure.

(2) The Appellate Tribunal shall, for the purposes of discharging its functions under this Act, have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908, while trying a suit in respect of the following matters, namely:—

(a) summoning and enforcing the attendance of any person and examining him on oath;

528 (249)

Appellate Tribunal and Benchesthereof.

President and Members of Appellate Tribunal, their qualification, appointment, conditions of service,etc.

Procedure before Appellate Tribunal.

251

528 (250) Hee wsTa, fete 12 FA 2017

(b) requiring the discovery and production of documents;

(c) receiving evidence on affidavits;

(d) subject to the provisions of sections 123 and 124 of 1 of 1872. the Indian Evidence Act, 1872, requisitioning any public record or documentor a copy of such record or document from anyoffice;

(e) issuing commissions for the examination of witnesses or documents;

(f) dismissing a representation for default or decidingit ex parte;

(g) setting aside any order of dismissal of any representation for default or any order passed by it ex parte; and

(h) any other matter which may be prescribed.

(3) Any order made by the Appellate Tribunal may be enforced by it in the same mannerasif it were a decree made by a court in a suit pending therein, and it shall be lawful for the Appellate Tribunal to send for execution ofits orders to the court within the local limits of whose jurisdiction,—

(a) in the case of an order against a company, the registered office ofthe companyis situated; or

b) in the case of an order against any other person, the berson concerned voluntarily resides or carries on business orpersonally worksfor gain.

(4) All proceedings before the Appellate Tribunal shall be deemed to be judicial proceedings within 45 of 1860. the meaning ofsections 193 and 228, and for the purposes of section 196 of the Indian Penal Code, and the Appellate Tribunal shall be deemed to be 2 of 1974. civil court for the purposes of section 195 and Chapter XXVIofthe Code of Criminal Procedure,

1973.

112. (1) Any person aggrieved by an order passed Appeals to Appellat e

against him under section 107 or section 108 of this Tribunal.

252

Hee wets, fetish 12 FA 2017 528 (251) Act or the Central Goods and Services Tax Act may appeal to the Appellate Tribunal against such order within three months from the date on which the order sought to be appealed against is communicated to the person preferring the appeal.

(2) The Appellate Tribunal may, in its discretion, refuse to admit any such appeal where the tax or input tax credit involved or the difference in tax or input tax credit involved or the amountoffine, fee or penalty determined by such order, does not exceed fifty thousand rupees.

(3) The Commissioner may, on his own motion, or upon request from the Commissioner of central tax, call for and examine the record of any order passed by the Appellate Authority or the Revisional Authority under this Act or under the Central Goods and Services Tax Act for the purpose ofsatisfying himself as to the legality or propriety of the said order and may, by order, direct any officer subordinate to him to apply to the Appellate Tribunal within six months from the date on which the said order has been passed for determination of such points arising out of the said order as may be specified by the Commissionerin his order.

(4) Where in pursuance of an order under sub-section

(3) the authorised officer makes an application to the Appellate Tribunal, such application shall be dealt with by the Appellate Tribunal as if it were an appeal made against the order under sub- section (11) of section 107 or under sub-section

(1) of section 108 and the provisions of this Act shall apply to such application, as they apply in relation to appeals filed under sub-section (1). (5)On receipt of notice that an appeal has been preferred under this section, the party against whom the appeal has been preferred may, notwithstanding that he may not have appealed against such orderor any part thereof, file, within forty five days of the receipt of notice, a memorandum of cross-objections, verified in the prescribed manner, against any part of the order

253

528 (252) Hee UsT, fe 12 YA 2017 appealed against and such memorandum shail be disposed of by the Appellate Tribunal, as if it were an appeal presented within the time specified in sub-section (1).

(6) The Appellate Tribunal may admit an appeal within three monthsafter the expiry of the period referred to in sub-section (1), or permit the filing of a memorandum ofcross-objections within forty five days after the expiry of the period referred to in sub-section (5), if it is satisfied that there was sufficient cause for not presenting it within that period.

(7) An appeal to the Appellate Tribunal shall be in such form, verified in such manner and shall be accompaniedby such fee, as may be prescribed.

(8) No appeal shall be filed under sub-section (1), unless the appellant has paid —

(a) in full, such part of the amountoftax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him, and

(b) a sum equal to twenty per cent. of the remaining amount of tax in dispute, in addition to the amount paid under sub-section (6) of the section 107, arising from the said order, in relation to which the appealhas beenfiled.

(9) Where the appellant has paid the amount as per sub-section (8), the recovery proceedings for the balance amount shall be deemed to be stayed till the disposal of the appeal.

(10) Every application made before the Appellate Tribunal, —

(a) in an appeal forrectification of error or for any other purpose; or ;

(b) for restoration of an appeal or an application, shall be accompanied by such fees as maybeprescribed.

113. (1) The Appellate Tribunal may, after giving the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, Orders of Appellate

Tribunal.

254

Reagan wera, fern 12 FA 2017 modifying or annulling the decision or order appealed against or may refer the case back to the Appellate Authority, or the Revisional Authority or to the original adjudicating authority, with such directions as it may think fit, for a fresh adjudication or decision after taking additional evidence, if necessary.

(2) The Appellate Tribunal may, if sufficient cause is shown,at any stage of hearing of an appeal, grant time to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing:

Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal.

(3) The Appellate Tribunal may amend any order passed by it under sub-section (1) so as to rectify any error apparent on the face of the record, if such error is noticed by it on its own accord, oris brought to its notice by the Commissioneror the Commissioner of central tax or the other party to the appeal within a period of three months from the date of the order:

Provided that no amendment which has theeffect of enhancing an assessment or reducing a refund or input tax credit or otherwise increasingthe liability of the other party, shall be made under this sub-section, unless the party has been given an opportunity of being heard.

(4) The Appellate Tribunal shall, as far as possible, hear and decide every appeal within a period of one year from the date on whichitis filed.

(5) The Appellate Tribunal shall send a copy of every order passed under this section to the Appellate Authority or the Revisional Authority, or the original adjudicating authority, as the case may be, the appellant and the Commissioner or the jurisdictional Commissionerof central tax.

(6) Save as provided in section 117 or section 118, orders passed by the Appellate Tribunal on an appealshall be final and binding on the parties.

528 (253)

255

528 (254) Hee usta, fer 12 FA 2017 114, The State President shall exercise such financial and administrative powers over the State Bench and Area Benches of the Appellate Tribunal in a State, as may beprescribed:

Provided that the State President shall-have the authority to delegate such of his financial and administrative powers as he may think fit to any other Memberor any officer of the State Bench or Area Benches,subject to the condition that such Member or officer shall, while exercising such delegated powers, continue to act under the direction, control and supervision of the State President.

115. Where an amountpaid by the appellant under sub- section (6) of section 107 or sub-section (8) of section 112 is required to be refunded consequentto any order of the Appellate Authority or of the Appellate Tribunal, interest at the rate specified under section 56 shall be payable in respect of such refund from the date of payment of the amounttill the date of refund of such amount.

116. (1) Any person who is entitled or required to appear before an officer appointed under this Act, or the Appellate Authority or the Appellate Tribunal in connection with any proceedings under this Act, may, otherwise than when required underthis Act to appear personally for examination on oath or affirmation, subject to the other provisions of this section, appear by an authorised representative.

(2) For the purposes of this Act, the expression

"authorised representative" shall mean a person authorised by the person referred to in sub-section

(1) to appearon his behalf, being —

(a) his relative or regular employee; or

(b) an advocate whois entitled to practice in any court in India, and who has not been debarred from practicing before any court in India; or

(c) any chartered accountant, a cost accountantor a company secretary, who holds certificate of practice and whohas not been debarred from practice; or Financial and

administrative powers

of State President.

Interest on refund of

amountpaid for

admission of appeal.

Appearance by

authorised

representative.

256

Fee, wera, feat 12 FA 2017 528 (255)

(d) a retired officer of the Commercial Tax Department of any State Government or Union territory or of the Board who, during his service under the Government, had worked in a post not below the rank than that of aGroup-B Gazetted officer for a period of not less than two years:

Provided that such officer shall not be entitled to appear before any proceedings under this Act for a period of one year from the date of his retirement or resignation; or

(e) any person who has been authorised to act as a goods and services tax practitioner on behalf of the concerned registered person.

(3) No person, —

(a) who has been dismissed or removed from Governmentservice; or

(b) who is 'convicted of an offence connected with any proceedings under this Act, the Central Goods and Services Tax Act, the Integrated Goods and Services Tax Act or the Union Territory Goods and Services Tax Act, or under the existing lawor under anyof the Acts passed by a State Legislature dealing with the imposition of taxes on sale of goods or supply of goodsorservices or both; or

(c) whois found guilty of misconduct by the prescribed authority;

(d) who has been adjudged as an insolvent, shall be qualified to represent any person under sub- section (1)}—

(i) for all times in case of persons referred to in clauses(a), (b) and (c); and

(ii) for the period during which the insolvency continues in the case of a person referred to in clause (d).

(4) Any person who has been disqualified under the provisions of the Central Goods and Services Tax

257

528 (256)

Feaye usta,^fei12YA2017 Act or the Goods and Services Tax Act of any other State or the Union Territory Goods and Services Tax Act shall be deemed to be disqualified under this Act.

117. (1) Any person aggrieved by anyorder passed by the State Bench or Area Benches of the Appellate Tribunal mayfile an appeal to the High Court and the High Court may admit such appeal, if it is satisfied that the case involves a substantial question of law.

(2) An appeal under sub-section (1) shall be filed within a period of one hundred and eighty days from the date on which the order appealed against is received by the aggrieved person andit shall be in such form, verified in such manner as may be prescribed:

Provided that the High Court may entertain an appeal after the expiry of the said period if it is satisfied that there was sufficient cause for notfiling it within such period.

(3) Where the High Court is satisfied that a substantial question of law is involvedin any case, it shall formulate that question and the appeal shall be heard only on the question so formulated, and the respondents shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question:

Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question.

(4) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award suchcostas it deemsfit.

(5) The High Court may determine any issue which—

(a) has not been determined by the State Bench or Area Benches; or

Appeal to High Court.

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(b) has been wrongly determined by the State Bench or Area Benches, by reason of a decision on such question of law as herein referred to in sub- section (3).

(6) Where an appeal has been filed before the High Court, it shall be heard by a Benchofnot less than two Judges of the High Court, and shall be decided in accordance with the opinion of such Judgesor of the majority, if any, of such Judges.

(7) Where there is no such majority, the Judges shall State the point of law upon which they differ and the case shall, then, be heard uponthatpointonly, by one or more of the other Judges of the High Court and such point shall be decided according to the opinion of the majority of the Judges who have heard the case including those whofirst heardit.

(8) Where the High Court delivers a judgment in an appeal filed before it under this section, effect shall be given to such judgment by either side on the basis of a certified copy of the judgment.

(9) Save as otherwise provided in this Act, the provisions of the Code of Civil Procedure, 1908, relating to appeals to the High Court shall, as far as may be, apply in the case of appeals underthis section.

118. (1) An appeal shall lie to the Supreme Court-

(a) from any order passed by the National Bench or Regional Benches of the Appellate Tribunal; or

(b) from any judgment or order passed by the High Court in an appeal made under section 117 in any case which, on its own motion or on an application made by or on behalf of the party aggrieved, immediately after passing of the judgmentor order, the High Court certifies to be a fit one for appeal to the Supreme Court.

(2) The provisions of the Code of Civil Procedure, 1908, relating to appeals to the Supreme Court shall, so far as may be, apply in the case of

528 (257)

Appealto Supreme Court.

528 (258) Heer wera, feti 12 FA 2017 appeals underthis section as they apply in the case ofappeals from decrees of a High Court.

(3) Where the judgment of the High Court is varied or reversed in the appeal, effect shall be given to the _-order of the Supreme Court in the manner provided in section 117 in the case of a judgment of the High Court.

119. Notwithstanding that an appeal has been preferred Sumsdueto be paid to the High Court or the Supreme Court, sums due to notwithstanding appeal the Governmentas a result of an order passed by the etc. National or Regional Benches of the Appellate

Tribunal under sub-section (1) of section 113 or an

order passed by the State Benchor Area Benches of

the Appellate Tribunal under sub-section (1) of

section 113 or an order passed by the High Court

under section 117, as the case may be, shall be

payable in accordance with the order so passed.

120. (1) The Commissioner may, on the Appeal notto be filed recommendations of the Council, from time to time, in certain cases. issue orders or instructions or directions fixing such monetary limits, as he may deem fit, for the purposes of regulating the filing of appeal or application by the officer of the State tax under the provisions of this Chapter.

(2) Where, in pursuance ofthe orders or instructions or directions issued under sub-section (1), the officer of the State tax has not filed an appeal or application against any decision or order passed under the provisions of this Act, it shall not preclude such officer of the State tax from filing appeal or application in any other case involving the sameorsimilar issues or questions of law. (3)Notwithstanding the fact that no appeal or application has been filed by the officer of the State tax pursuant to the orders or instructions or directions issued under sub-section (1), no person, being a party in appeal or application shall contend that the officer of the State tax has acquiesced in the decision on the disputed issue by notfiling an appeal or application.

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Hee Usa, fetie 12 FA 2017 528 (259)

(4) The Appellate Tribunal or court hearing such appeal or application shall have regard to the circumstances under which appeal or application was not filed by the officer of the State tax in pursuance of the orders or instructions or directions issued under sub-section (1).

121. Notwithstanding anything to the contrary in any Non appealable provisions of this Act, no appeal shall lie against any decisions andorders. decision taken or order passed by an officer of State tax if such decision taken or order passed relates to anyoneor moreofthe following matters, namely:—

(a) an order of the Commissioneror otherauthority empowered to direct transfer of proceedings from one officer to anotherofficer; or

(b) an order pertaining to the seizure or retention of books of account, register and other documents; or

(c) an order sanctioning prosecution underthis Act; or

(d) an order passed undersection 80.

CHAPTER XIX

OFFENCES AND PENALTIES

122. (1) Where a taxable person who— - Penalty for certain. offences.

(i) supplies any goods or services or both without issue of any invoice or issues an incorrect or false invoice with regard to any such supply;

(ii) issues any invoice or bill without supply of goods or services or both in violation of the provisions of this Act or the rules made thereunder;

(iii) collects any amountas tax but fails to pay the same to the Government beyond a period of three months from the date on which such payment becomes due;

(iv) collects any tax in contravention of the provisions of this Act but fails to pay the same to the

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528 (260) Fee wsrya, feats 12 YA 2017 Government beyond a.period of three months from the date on which such payment becomes due;

(v) fails to deduct the tax in accordance with the provisions of sub-section (1) of section 51, or deducts an amount which is less than the amount required to be deducted under the said sub-section, or where he fails to pay to the Government under sub-section (2) thereof, the amount deductedas tax;

(vi) fails to collect tax in accordance with the provisions of sub-section (1) of section 52, or collects an amount whichis less than the amountrequired to be collected under the said sub-section or where he fails to pay to the Government the amountcollected as tax under sub-section (3) of section 52;

(vii) takes or utilizes input tax credit without actual receipt of goods or services or both either fully or partially, in contravention of the provisions of this Act or the rules made thereunder;

(viii) fraudulently obtains refund of tax under this Act;

(ix) takes or distributes input tax credit in contravention of section 20, or the rules made thereunder; :

(x) falsifies or substitutes financial records or produces fake accounts or documents or furnishes any false information or return with an intention to evade paymentoftax due underthis Act;

(xi) is liable to be registered under this Act butfails to obtain registration;

(xii) furnishes any false information with regard to registration particulars, either at the time of applying for registration, or subsequently;

(xiii) obstructs or prevents any officer in discharge of his duties under this Act;

(xiv) transports any taxable goods without the. cover of documents as maybespecified in this behalf;

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Heer terra, feats 12 YA 2017

(xv) suppresses his turnover leading to evasion of tax underthis Act;

(xvi) fails to keep, maintain or retain books of account and other documents in accordance with the provisionsofthis Act or the rules made thereunder;

(xvii) fails to furnish information or documents called for by an officer in accordance with the provisions of this Act or the rules made thereunder or furnishes false information or documents during any proceedings underthis Act;

(xviii) supplies, transports or stores any goods which he has reasons to believe are liable to confiscation underthis Act;

(xix) issues any invoice or document by using the registration numberofanother registered person;

(xx) tampers with, or destroys any material evidence dr documents;

(xxi) disposes off or tampers with any goods that have been detained, seized, or attached underthis Act, he shall be liable to pay a penalty of ten thousand rupees or an amount equivalent to the tax evaded or the tax not deducted under section 51 or short deducted or deducted but not paid to the Governmentor tax not collected under section 52 or short collected or collected but not paid to the Governmentorinput tax credit availed of or passed on or distributed irregularly, or the refund claimed fraudulently, whicheveris higher.

(2) Any registered person who supplies any goods or services or both on which any tax has not been paid or short-paid or erroneously refunded, or where the input tax credit has been wrongly availed orutilized,-

(a) for any reason, other than the reason of fraud or any wilful misstatement or suppression of facts to evade tax, shall be liable to a penalty ' of ten thousand rupees or ten per cent. of the | tax due from such person, whicheveris higher;

528 (261)

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528 (262) Fee Ueda, fetta 12 FA 2017

(b) for reason of fraud or any wilful misstatement or suppression of facts to evade tax, shall be liable to a penalty equal to ten thousand rupees or the tax due from such person, whichever is higher.

(3) Any person who—

(a) aids or abets any of the offences specified in clauses(i) to (xxi) of sub-section(1);

(b) acquires possession of, or in any way concerns himself in transporting, removing, depositing, keeping, concealing, supplying, or purchasing or in any other manner deals with any goods which he knows or. has reasons to believe are liable to confiscation under this Act or the rules made thereunder;

(c) receives or is in any way concerned with the supply of, or in any other manner deals with any supply of services which he knowsorhas reasonsto believe are in contravention of any provisionsof this Actor the rules made thereunder;

(d) fails to appear before the officer of State tax, when issued with a summon for appearance to give evidence or produce a documentin an inquiry;

(e) fails to issue invoice in accordance with the provisions of this Act or the rules made thereunder or fails to account for an invoice in his books of account,

shall be liable to a penalty which may extend to twenty five thousand rupees.

123. If a person who is required to furnish an information return under section 150 fails to do so within the period specified in the notice issued under sub-section (3) thereof, the proper officer may direct, that such person shall be liable to pay a penalty of one hundred rupees for each day of the period during whichthefailure to furnish such return continues:

Provided that the penalty imposed under this section shall not exceed five thousand rupees.

Penalty for failure to

furnish

return.

information

264

Hee wsrra, fee 12 FA 2017 528 (263)

124. If any person required to furnish any information Finefor failure to or return under section 151,— furnishstatistics.

(a) without reasonable cause fails to furnish such information or return as may be required under that section, or

(b) wilfully furnishes or causes to furnish any information or return which he knowsto befalse, he shall be punishable with a fine which may extend to ten thousand rupees and in case of a continuing offence to a further fine which may extend to one hundred rupees for each day after the first day during which the offence continues subject to a maximum limit of twenty five thousand rupees.

125. Any person, who contravenes any of the Generalpenalty. provisions of this Act or any rules made thereunder for which no penalty is separately provided forin this Act, shall be liable to a penalty which may extend to twenty five thousand rupees.

126. (1) No officer under this Act shall impose any Generaldisciplines penalty for minor breaches of tax regulations or related to penalty. procedural requirements and in particular, any

omission or mistake in documentation which is easily rectifiable and made without fraudulentintent or gross negligence.

Explanation.—For the purpose ofthis sub-section,—

(a) a breach shall be considered a 'minor breach'if the amount of tax involved is less than five thousand rupees;

(b) an omission or mistake in documentation shall be considered to be easily rectifiable if the same is an - error apparent on the face of record.

(2) The penalty imposed under this Act shall depend on the facts and circumstances of each case and shall commensurate with the degree and severity of the breach.

(3) No penalty shall be imposed on any person without giving him an opportunity of being heard.

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528 (264) Hee UIT, Teh 12 YA 2017

128.

(4) The officer under this Act shall while imposing penalty in an order for a breach of any law, regulation or procedural requirement, specify the nature of the breach and the applicable law, regulation or procedure under which the amount ofpenalty for the breach has been specified.

(5) When a person voluntarily discloses to an officer underthis Act the circumstancesof a breach of the tax law, regulation or procedural requirement prior to the discovery of the breach by the officer under this Act, the proper officer may consider this fact as a mitigating factor when quantifying a penalty for that person.

(6) The provisions of this section shall not apply in such cases where the penalty specified under this Act is either a fixed sum or expressed as a fixed percentage.

127. Where the proper officer is of the view that a person is liable to a penalty and the same is not covered under any proceedings under section 62 or section 63 or section 64 or section 73 or section 74 or section 129 or section 130, he may issue an order levying such penalty after giving a reasonable opportunity of being heard to such person. The Government may, by notification, waive in part or full, any penalty referred to in section 122 or section 123 or section 125 or any late fee referred to in section 47 for such class of taxpayers and undersuch mitigating circumstances as may be specified therein on the recommendations of the Council.

129. (1) Notwithstanding anything contained in this Act, where any person transports any goods or stores any goods while theyare in transit in contravention of the provisions of this Act or the rules made thereunder, all such goods and conveyance used as a means of transport for carrying the said goods and documents relating to such goods and conveyance shall be liable to detention or seizure and after detention or seizure, shall be released,— Powerto impose

penalty in certain cases.

Powerto waive penalty

or fee or both

Detention, seizure and

release of goods and

conveyancesin transit.

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Fee ws, fet 12 FA 2017

(a) on payment of the applicable tax and penalty equal to one hundred per cent. of the tax payable on such goods and, in case of exempted goods, on payment of an amount equal to two per cent of the value of goods or twenty five thousand rupees, whichever is less, where the owner of the goods comes forward for payment 'of such tax and penalty;

(b) on paymentofthe applicable tax and penalty equal to the fifty per cent. of the value of the goods reduced by the tax amount paid thereon and, in case of exempted goods, on payment of an amount equal to five per cent of the value of goods or twenty five thousand rupees, 'whichever is less, where the owner of the goods does not come forward for payment of such tax and penalty;

(c) upon furnishing a security equivalent to the amount payable under clause (a) or clause (b) in - such form and manneras maybe prescribed:

Provided that no such goods or conveyance shall be detained or seized without serving an order of detention or seizure on the person transporting the goods.

(2) The provisions of sub-section (6) of section 67 shall, mutatis mutandis, apply for detention and seizure of goods and conveyances.

(3) The proper officer detaining or seizing goods or conveyances shall issue a notice specifying the tax and penalty payable and thereafter, pass an order for paymentof tax and penalty under clause (a) or clause

(b) or clause (c).

(4) No tax, interest or penalty shall be determined under sub-section (3) without giving the person concerned an opportunity of being heard.

(5) On payment of amountreferred in sub-section (1),all proceedings in respect of the notice specified in sub- section (3) shall be deemed to be concluded.

(6) Where the person transporting any goodsor the owner of the goods fails to pay the amount oftax and penalty

528 (265)

267

528 (266) ^Heewet,feqiee^12FA2017 as provided in sub-section (1) within seven days of such detention or seizure, further proceedings shall be initiated in accordance with the provisions of section _ 130:

Provided that where the detained or seized goods are perishable or hazardousin nature orare likely to depreciate in value with passage of time, the said period of seven days may be reduced by the proper officer.

130. (1) Notwithstanding anything contained in this Confiscation of goods Act, if any person — or conveyances and

levy of penalty.

(i) supplies or receives any goodsin contravention ofany ofthe provisions of this Act or the rules made thereunder with intent to evade paymentoftax;or

(ii) does not account for any goods on whichheis liable to pay tax underthis Act; or

(iii) supplies any goods liable to tax under this Act without having applied for registration; or

(iv) contravenesanyofthe provisionsofthis Act or the rules made thereunder with intent to evade payment of tax; or

(v) uses any conveyance as a means of transport for carriage of goods in contravention of the provisions of this Act or the rules made thereunder unless the owner of the conveyance proves that it was so used without the knowledge or connivance of the owner himself, his agent, if any, and the person in charge of the conveyance, then, all such goods or conveyancesshall be liable to confiscation and the person shall be liable to penalty undersection 122.

(2) Whenever confiscation of any goods or conveyance is — authorised by this Act, the officer adjudging it shall

268

Fee Usa, fetis 12 YA 2017 give to the ownerof the goods an option to pay in lieu of-confiscation, such fineas the said officer thinksfit:

Provided that such fine leviable shall not exceed the market value of the goods confiscated, less the tax chargeable thereon:

Provided further that the aggregate of such fine and penalty leviable shall not be less than the amount of penalty leviable under sub-section (1) of section 129:

Provided also that where any such conveyanceis used for the carriage of the goods or passengers for hire, the owner of the conveyance shall be given an option to pay in lieu of the confiscation of the conveyance a fine equal to the tax payable on the goods being transported thereon.

(3) Where any fine in lieu of confiscation of goods or conveyance is imposed under sub-section (2), the owner of such goods or conveyance or the person referred to in sub-section (1), shall, in addition, be liable to any tax, penalty and charges payable in respect of such goods or conveyance.

(4) No order for confiscation of goods or conveyance or for imposition of penalty shall be issued without givingthe person an opportunity of being heard.

(5) Whereany goods or conveyanceare confiscated under this Act, the title of such goods or conveyance shall thereupon vest in the Government.

(6) The proper officer adjudging confiscation shall take and hold possession of the things confiscated and every officer of Police, on the requisition of such properofficer, shall assist him in taking and holding such possession.

(7) The proper officer may, after satisfying himself that the confiscated goods or conveyance are not required in any other proceedings under this Act and after giving reasonable time not exceeding three monthsto pay fine in lieu of confiscation, dispose of such goods or conveyance and deposit the sale proceeds thereof with the Government.

528 (267)

269

528 (268)

2 of 1974. Hee Usa, feria 12 FA 2017

131. Without prejudice to the provisions contained in the Code of Criminal Procedure, 1973, no confiscation made or penalty imposed underthe provisions of this Act or the rules made thereunder shall prevent the infliction of any other punishment to which the person affected thereby is liable under the provisions ofthis Act or under any other law forthe time being in force.

132. (1) Whoever commits any of the following. offences, namely:—

(a) supplies any goodsorservices or both without issue of any invoice, in violation of the provisions of this Act or the rules made thereunder, with the intention to evade tax;

(b) issues any invoice or bill without supply of goods or services or both in violation of the provisions of this Act, or the rules made thereunder leading to wrongful availment or utilisation of input tax credit or refund of tax;

(c) avails input tax credit using such invoice or bill referred to in clause (b);

(d) collects any amountas tax but fails to pay the same to | the Government beyonda period of three months from the date on which such payment becomesdue;

(e) evades tax, fraudulently avails inputtax credit or fraudulently obtains refund and where such offence is not covered under clauses (a) to (d);

(f) falsifies or substitutes financial records or produces fake accounts or documents or furnishes any false information with an intention to evade paymentof tax due underthis Act;

(g) obstructs or prevents any officer in the discharge of his duties under this Act;

(h) acquires possessionof, or in any way concernshimself in transporting, removing, depositing, keeping, concealing, supplying, purchasing or in any other manner Confiscation or penalty

not to interfere with

other punishments.

Punishmentfor certain

offences

270

wea WaT, fete 12 FA 2017 deals with, any goods which he knowsor has reasons to believe are liable to confiscation under this Act or the rules made thereunder;

(i) receives or is in any way concerned with the supply of, or in any other manner deals with any supply of services which he knows or has reasons to believe are in contravention of any provisions of this Act or the rules made thereunder;

(j) tampers with or destroys any material evidence or documents;

(k) fails to supply any information whichheis required to supply under this Act or the rules made thereunder or (unless with a reasonable belief, the burden of proving which shall be upon him,that the information supplied by him is true) supplies false information; or

(1) attempts to commit, or abets the commission of any of the offences mentioned in clauses(a) to (k) ofthis section, shall be punishable—

(i) in cases where the amountof tax evaded or the amount — of input tax credit wrongly availed or utilised or the amount of refund wrongly taken exceeds five hundred lakh rupees, with imprisonment for a term which may extend to five years and with fine;

(ii) in cases where the amount of tax evaded or the amount of input tax credit wrongly availed or utilised or the amount of refund wrongly taken exceeds two hundred lakh rupees but does not exceed five hundred lakh rupees, with imprisonment for a term which may extend to three years and with fine;

(iii) in the case of any other offence where the amount of tax evaded or the amount of input tax credit wrongly availed or utilised or the amount of refund wrongly taken exceeds one hundred lakh rupees but does not exceed two hundred lakh rupees, with imprisonment for a term which may extend to one year and with fine;

528 (269)

271

528 (270) Fee usa, fers 12 VA 2017

(iv) in cases where he commits or abets the commission of an offence specified in clause (f) or clause (g) or clause (j), he shall be punishable with imprisonment for a term which may extend to six months or with fine or with both.

(2) Where any person convicted of an offence under this section is again convicted of an offence under this section, then, he shall be punishable for the second and for every subsequent offence with imprisonment for a term which mayextend to five years and with fine.

(3) The imprisonment referred to in clauses (i), (ii) and

(iii) of sub-section (1) and sub-section.(2) shall, in the absence of special and adequate reasons to the contrary to be recorded in the judgment of the Court, be for a term notless than six months.

(4) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, all offences under this Act, except the offences referred to in sub-section (5) shall be non-cognizable and bailable.

(5) The offences specified in clause (a) or clause (b) or clause (c) or clause (d) of sub-section (1) and punishable underclause(i) of that sub-section shall be cognizable and non-bailable.

(6) A person shall not be prosecuted for any offence underthis section except with the previous sanction of the Commissioner.

Explanation.- For the purposes of this section, the term

"tax" shall include the amount of tax evaded or the amount of input tax credit wrongly availed or utilised or refund wrongly taken underthe provisionsofthis Act, the Central Goods and Services Tax Act, the Integrated Goods and Services Tax Act, and cess levied under the Goods and Services Tax (Compensationto States) Act. 133.(1) Where any person engaged in connection with the collection of statistics under section 151 or compilation or computerisation thereof or if any. officer of State tax having access to information specified under sub-section (1) of section 150, or if any person engaged Liability of officers and

certain other persons.

272

Ree usr, fee 12 YA 2017 in connection with the provision of service on the | common portal or the agent of commonportal, wilfully discloses any information or the contents of any return furnished under this Act or rules made thereunder otherwise than in execution of his duties under the. said sections or for the purposes of prosecution for an offence under this Act or under any other Act for the time being in force, he shall be punishable with imprisonment for a term which may extend to six months or with fine which 'may extend to twenty five thousand rupees, or with both.

(2) Any person —

(a) who is a Governmentservant shall not be prosecuted for any offence under this section except with the previous sanction of the Government;

(b) who is not a Government servant shall not be prosecuted for any offence under this section except with the previous sanction of the Commissioner.

134. No court shall take cognizance of any offence punishable under this Act or the rules made thereunder except with the previous sanction of the Commissioner, and no court inferior to that of a Magistrate of the First Class, shall try any such offence. \

135. In any prosecution for an offence under this Act which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state but it shall be a defence for the accused to prove the fact that he had no such mental state with respect to the act charged as an offence in that prosecution.

Explanation.—Forthe purposes of this section—

(i) the expression "culpable mental state" includes intention, motive, knowledge of a fact, and belief in, or reason to believe, a fact;

(ii) a fact is said to be proved only whenthe court believes it to exist beyond reasonable doubt and not merely when its existence is established by a preponderanceofprobability.

528 (271)

Cognizanceofoffences. Presumption of

culpable mental state.

273

528 (272) Heme tessa, feria 12 3A 2017

136. A statement made and signed by a person on Relevancy of appearance in response to any summonsissued under statements under section 70 during the course of any inquiry or certain circumstances, proceedings under this Act shall be relevant, for the purpose of proving, in any prosecution for an offence under this Act, the truth of the facts which it

contains,—

(a) when the person who made the statement is dead or cannot be found, or is incapable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot beobtained without an amount of delay or expense which, under the circumstances of the case, the court considers unreasonable; or

(b) when. the person who made the statement is examined as a witness in the case before the court and the court is of the opinion that, having regard to the circumstances of the case, the statement should be admitted in evidencein the interest ofjustice.

137. (1) Where an offence committed by a person Offences by under this Act is a company, every person who, at the Companies. time the offence was committed wasin charge of, and . was responsible to, the company for the conduct of business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

(2)Notwithstanding anything contained in sub- section (1), where an offence under this Act has been committed by a company andit is proved

that the offence has been committed with the

consent or connivanceof, or is attributable to any negligence on the part of, any director, manager, secretary or other officer of the company, Such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and

punished accordingly.

(3) Where an offence under this Act has been committed by a taxable person being a partnership firm or a Limited Liability Partnership or a Hindu

274

mee wat, fete 12 A 2017 © 528 (273) Undivided Family or a trust, the partner or karta or managing trustee shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly and the provisions of sub-section (2) shall mutatis mutandis apply to such persons.

(4) Nothing contained in this section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.

Explanation.—Forthe purposesofthis section,—

(i) "company" meansa body corporate and includes a firm or other association of individuals; and

(ii) "director", in relation to afirm, means a partner in the firm.

138. (1) Any offence under this Act may, either before Compounding of or after the institution of prosecution, be compounded offences. by the Commissioner on payment, by the person

accused of the offence, to the Central Government or the State Government, as the case may be, of such compounding amount in such manner as may be

prescribed:

Provided that nothing contained in this section — shall apply to ~ ,

(a) a person who has been allowed to compound once in respect of any of the offences specified in clauses (a) to (f) of sub-section (1) of section 132 and the offences specified in clause (I) which are relatable to offences specified in clauses (a) to (f) ofthe said sub-section;

(b) a person who has been allowed to compound once in respect of any offence, other than those in clause (a), under this Act or under the provisions of any State Goods and Services Tax Act or the Central Goods and Services Tax Act or the Union Territory Goods and Services Tax Act or the Integrated

275

528 (274)

Aeare^{UAT,feat12SA2017} Goods and Services Tax Act in respect of supplies of value exceeding one crore rupees;

(c) a person who has been accused of committing an offence under this Act which is also an offence under any otherlaw for the time being in force;

(d) a person who has been convicted for an offence underthis Act by a court;

(e) a person who has been accused of committing an offence specified in clause (g) or clause (j) or clause (k) of sub-section (1) of section 132; and

(f) any other class of persons or offences as may be prescribed:

Provided further that any compounding allowed under the provisions of this section shall not affect the proceedings, if any, instituted under any other law:

Provided also that compounding shall be allowed only after making paymentof tax, interest and penalty involved in such offences.

(2) The amount for compounding of offences under this section shall be such as may beprescribed, subject to the minimum amount not being less than ten thousand rupees or fifty per cent of the tax involved, whichever is higher, and the maximum amount not being less than thirty thousand rupeesor one hundred andfifty per cent. of the tax, whicheveris higher.

(3) On payment of such compounding amount as may be determined by the Commissioner, no further proceedings shall be initiated under this Act against the accused person in respect of the same offence and any criminal proceedings, if already initiated in respect of the said offence, shall stand abated.

CHAPTER XX

TRANSITIONAL PROVISIONS

139. (1) On and from the appointed day, every person registered under any of the existing laws and having a valid Permanent Account Numbershall be issued a certificate of registration on provisional basis, subject to such conditions and in such form and manner as Migration of existing

taxpayers.

276

74 of 1956

(2)

G3)

140

Hee wera, feria 12 FA 2017 may be prescribed, which unless replaced by a final certificate of registration under sub-section (2), shall be liable to be cancelled if the conditions so prescribed are not complied with.

The final certificate of registration shall be granted in such form and manner and subject to such conditions as maybeprescribed.

The certificate of registration issued to a person under sub-section (1) shall be deemed to have not been issued if the said registration is cancelled in pursuance of an application filed by such person that he was notliable to registration under section 22 or section 24.

» (1) registered person, other than a person opting to pay tax undersection 10, shall be entitled to take,in

528 (275)

Transitional arrangements for his electronic credit ledger, credit of the amount of input tax credit. Value Added Tax, , if any, carried forward in the return relating to the period ending with the day immediately preceding the appointed day, furnished by him under the existing law in such manner as may be prescribed:

Provided that the registered person shall not be

allowed to take credit in the following circumstances, namely: —

(i) where the said amount ofcredit is not admissible as input tax credit under this Act; or _ Gi) where he has not furnished all the returns required under the existing law for the period of six months immediately preceding the appointed date; or

Provided further that so much of the said credit as is attributable to any claim related to section 3, sub-section (3) of section 5, section 6, section 6A or sub-section (8) of section 8 of the Central Sales Tax Act, 1956 which is not substantiated in the manner, and within the period, prescribed in rule 12 of the Central Sales Tax (Registration and Turnover) Rules, 1957 shal] not be eligible to be credited to the electronic credit ledger:

528 (276) Here wstas, feat 12 FA 2017 Provided also that an amount equivalentto the credit specified in the second proviso shall be refunded under the existing law when the said claims are substantiated in the manner prescribed in rule 12 of the Central Sales Tax (Registration _and Turnover) Rules, 1957.

(2) A registered person, other than a person opting to pay tax undersection 10, shall be entitled to take, in his electronic credit ledger, credit of the unavailed input tax credit in respect of capital goods, not carried forward in a return, furnished under the existing law by him, for the period ending with the day immediately preceding the appointed day in such manner as may be prescribed:

Provided that the registered person shall not be allowed to take credit unless the said credit was admissible as input tax credit under the existing law and is also admissible as input tax credit under this Act.

Explanation.—-For the purposes of this section, the expression "unavailed input tax credit" means the amount that remains after subtracting the amount of input tax credit already availed in respect of capital goods by the taxable person under the existing law from the aggregate amount of input tax credit to which the said person was entitled in respect of the said capital goods under the existinglaw.

(3) A registered person, who was not liable to be registered under the existing law or who was engagedin the sale of exempted goodsortax free goods, by whatever name called, or goods which have suffered tax at the first point of their sale in the State and the subsequentsales of whichare not subject to tax in the State under the existing law but which are liable to tax under this Act or where the person wasentitled to the credit of input tax at the time of sale of goods, if any, shall be entitled to take, in his electronic credit ledger, credit of the value added tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the appointed day subject to the following conditions namely:—

278

wee wearsa, fei 12 FA 2017 528 (277)

(i) such inputs or goods are used or intended to be used for making taxable supplies under this Act;

(ii) the said registered person is eligible for input tax credit on such inputs underthis Act;

(iii) the said registered person is in possession of invoice or other prescribed documents evidencing payment of tax under the existing law in respect of such inputs; and

(iv) such invoices or other prescribed documents were issued not earlier than twelve months immediately preceding the appointed day:

Provided that where a registered person, other than a manufacturer or a supplier of services, is not in possession of an invoice or any other documents evidencing payment of tax in respect of inputs, then, such registered person shall, subject to such conditions, limitations and safeguards as may be prescribed, including that the said taxable person shall pass on the benefit of such credit by way of reducedprices to the recipient, be allowed to take credit at such rate and in such manner as may be prescribed.

(4) A registered person, who was engagedin the sale of taxable goods as well as exempted goodsortax free goods, by whatever name called, under the existing law but which are liable to tax underthis Act, shall be entitled to take, in his electronic credit ledger,-

(a) the amountof credit of the value addedtax,if any, carried forward in a return furnished under the existing law by him in accordance with the provisions of sub-section (1); and

(b) the amountof credit of the value added tax , if any, in respect of inputs held in stock .and inputs contained in semi-finished or finished goods held in stock on the appointed day, relating to such exempted goods or tax free goods, by whatever namecalled, in accordance with the provisions of sub-section (3).

279

528 (278) FeameR weaTa, fete 12 FA 2017

(5) A registered person shall be entitled to take, in his electronic credit ledger, credit of value added tax, if any, in respect of inputs received on or after the appointed day but the tax in respect of which has been paid by the supplier under the existing law, subject to the condition that the invoice or any other tax paying document of the same was recorded in the books of account of such person within a period of thirty days from the appointed day: ¢

Provided that the period of thirty days may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding thirty days:

Provided further that the said registered person shall furnish a statement, in such manner as may beprescribed, in respect of credit that has been taken under this sub- section.

(6) A registered person, who was either paying tax at a fixed rate or paying a fixed amountin lieu ofthe - tax payable underthe existing law shall be entitled to take, in his electronic credit ledger, credit of value added tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the appointed day subject to the following conditions, namely:—

(i) such inputs or goodsare used orintended to be used for making taxable supplies underthis Act;

(ii) the said registered person is not paying tax undersection 10;.

(iii) the said registered person is eligible for input tax credit on such inputs underthis Act;

(iv) the said registered person is in possession of 'invoice or other prescribed documents evidencing payment of tax under the existing law in respect of inputs; and

(v) such invoices or other prescribed documents were issued not earlier than twelve months immediately preceding the appointed day.

280

Hee wees, feat 12 FA 2017 528 (279)

(7) The amount of credit under sub-sections (3),

(4) and (6) shall be calculated in such manneras may be prescribed.

141. (1) Where any inputs received at a place of Transitional business had 'been despatched as such or provisionsrelating to despatchedafter being partially processed to a job job work. worker for further processing, testing, repair, reconditioning or any other purpose in accordance with the provisions of existing law prior to the appointed day and such inputs are returned to the said place on or after the appointed day, no tax shall be payable if such inputs, after completion of the job work or otherwise, are returned to the said place within six months from the appointed day:

Provided that the period of six months may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding two months:

Provided further that if such inputs are not returned within the period specified in this sub- section, the input tax credit shall be liable to be recovered in accordance with the provisions of clause (a) of sub-section (8) of section 142.

(2) Where any semi-finished goods had been despatched from the place of business to any other premises for carrying out certain manufacturing processes in accordance with the provisions of existing law prior to the appointed day and such goods (hereafter in this sub-section referred to as

"the said goods") are returned to the said place on or after the appointed day, no tax shall be payable if the said goods, after undergoing. manufacturing processes or otherwise, are returned to the said place within six months from the appointed day:

Provided that the period of six months may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding two months:

Provided further that if the said goods are not returned within a period specified in this sub- section, the input taxcredit shall be liable to be recovered in accordance with the provisions of clause (a) of sub-section (8) of section 142:

281

528 (280) ^Heeusta, feats^12FA2017 Provided also that the person despatching the goods may, in accordance with the provisions of the existing law, transfer the said goods to the premises of any registered person for the purpose of supplying therefrom on paymentoftax in India or without payment of tax for exports within the period specified in this sub-section.

(3) Where any goods had been despatched from the place of business without payment of tax for carrying out tests or any other process, to any other premises, whether registered or not, in accordance with the provisions of existing law prior to the appointed day and such goods, are returned to the said place of business on or after the appointed day, no tax shall be payable if the said goods, after undergoing tests or any other process, are returned to such place within six - months from the appointed day:

Provided that the period of six months may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding two months:

Provided further that if the said goods are not returned within the period specified in this sub- section, the input tax credit shall be liable to be recovered in accordance with the provisions of clause (a) of sub-section (8) of section 142:

Provided also that the person despatching. the goods may, in accordance with the provisions of the existing law, transfer the said goods from the said other premises on payment of tax in India or without payment of tax for exports within the period specified in this sub-section.

(4) The tax under sub-sections (1), (2) and (3) shall not be payable, only if the person despatching the goods and the job worker declare the details of the inputs or goods held in stock by the job worker on — behalf of the said person on the appointed day in such form and manner and within such time as maybe prescribed.

282

Hee usta, fete 12 Ft 2017 528 (281)

142. (1) Where any goods on whichtax, if any, had Miscellaneous been paid underthe existing law at the time of sale transitional thereof, not being earlier than six months prior to provisions. _ the appointed day, are returned to any place of business on or after the appointed day, the

registered person shall be eligible for refund of the tax paid under the existing law where such goods are returned by a person, other than a registered person, to the said place of business within a period of six months from the appointed day and such goodsare identifiable to the satisfaction of the proper officer:

Provided that if the said goods are returned by a registered person, the return of such goodsshall be deemed to be a supply.

(2) (a) Where, in pursuance of a contract entered into prior to the appointed day, the price of any goods is revised upwards on or after the appointed day, the registered person who had sold such goods shall issue to the recipient a supplementary invoice or debit note, containing such particulars as may beprescribed, within thirty days of such price revision and for the purposes of this Act, such supplementary invoice or debit note shall be deemed to have been issued in respect of an outward supply madeunderthis Act;

(b) Where, in pursuance of a contract entered into prior to the appointed day, the price of any goods is revised downwards on or after the appointed day, the registered person who had sold such goods may issue to the recipient a credit note, containing such particulars as may be prescribed, within thirty days of such price revision and for the purposes of this Act such credit note shall be deemed to have been issued in respect of an outward supply made underthis Act:

Provided that the registered person shall be allowed to reducehis tax liability on account of issue of the credit note only if the recipient of the credit note has reducedhis input tax credit corresponding to such reduction oftax liability.

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528 (282) Heme WeaTa, feat 12 FA 2017

(3) Every claim for 'refund filed by any person before, on or after the appointed day for refund of any amount of input tax credit, tax, interest or any other amountpaid underthe existing law, shall be disposed of in accordance with the provisions of existing law and any amount eventually accruing to him shall.be refunded to him in cash in accordancewith the provisions of the said law:

Provided that where any claim for refund of the amount of input tax credit is fully or partially rejected, the amountso rejected shall lapse:

Provided further that no' refund shall be allowed of any amount of input tax credit where the balance of the said amount as on the appointed day has been carried forward underthis Act.

(4) Every claim for refund filed after the appointed day for refund of any tax paid under the existing law in respect of the goods exported before or after the appointed day, shall be disposed of in accordance with the provisions of the existing law:

Provided that where any claim for refund of input tax credit is fully or partially rejected, the amount so rejected shall lapse:

Provided further that no refund shall be allowed of any amount of input tax credit where the balance of the said amount as on the appointed day has been carried forward underthis Act.

(5) Notwithstanding anything to the contrary contained in this Act, any amount of input tax credit reversed prior to the appointed day shall not be admissible as input tax credit under this Act.

(6) (a) every proceeding of appeal, revision, review or referencerelating to a claim for inputtax credit initiatedwhether before, on or after the appointed day underthe existing law shall be disposed ofin accordance with the provisions of the existing law, and any amount of credit found to be admissible to the claimant shall be refunded to — him in cash in accordance with the provisions of the existing law, and the amountrejected, if any, shall not be admissible as input tax credit under this Act:

284

meager ustia, feat 12 FA 2017 | 528 (283) Provided that no refund shall be allowed of any amount of input tax credit where the balance of the said amount as on the appointed day has been carried forward underthis Act;

(b) every proceeding of appeal, revision, review or reference relating to recovery of input tax credit initiated whether before, on or after the appointed day under the existing law shall be disposed of in accordance with the provisions of the existing law, and if any amount of credit becomes recoverable as a result of such appeal, revision, review or reference, the same shall, unless recovered under the existing law, be recovered as an arrear of tax under this Act and the amount so recovered shall not be admissible as input tax credit under this Act.

(7) (a) Every proceeding of appeal, revision, review or reference relating to any output tax liability initiated whether before, on or after the appointed day underthe existing law, shall be disposed of in accordance with the provisions of the existing law, and if any amount becomesrecoverable as a result of such appeal, revision, review © or reference, the same shall, unless recovered under the existing law, be recovered as an arrear of tax under this Act and the amount so recovered shall not be admissible as input tax credit under this Act.

(b) Every proceeding of appeal, revision, review or reference relating to any output tax liability initiated whether before, on or after the appointed day underthe existing law,shall be disposed of in accordance with the provisionsofthe existing law, and any amount found to be admissible to the claimant shall be refunded to him in cash in accordance with the provisionsof the existing law and the amount rejected, if any, shall not be admissible as input tax credit underthis Act. (8)(a) Where in pursuance of an assessment or adjudication proceedings instituted, whether before, on or after the appointed day under the

285

528 (284) mage wets, Feri 12 Yt 2017 existing law, any amountoftax, interest, fine or penalty becomes recoverable from the person, the same shall, unless recovered under the existing law, be recovered as an arrear of tax underthis Act and the amount so recovered shall not be admissible as input tax credit underthis Act; .

(b) Where in pursuance of an assessment or adjudication proceedings instituted, whether before, on or after the appointed day under the existing law, any amountof tax, interest, fine or penalty becomes refundable to the taxable person, the same shall be refunded to him in cash under the said law, and the amountrejected, if any, shall not be admissible as input tax credit under this Act.

(9) (a) Where anyreturn, furnished underthe existing law, is revised after the appointed day and if, pursuant to such revision, any amountis found to be recoverable or any amountofinputtax credit is found to be inadmissible, the same shall, unless recovered under the existing law, be recovered as an arrear of tax under this Act and the amount so recovered shall not be admissible as input tax credit under this Act;

(b) Where any return, furnished underthe existing law, is revised after the appointed day but within the time limit specified for such revision under the existing law andif, pursuant to such revision, any amount is found to be refundable or input tax credit is found to be admissible to any taxable person, the same shall be refunded to him in cash under the existing law, and the amount rejected, if any, shall not be admissible as input tax credit underthis Act.

(10) Save as otherwise provided in this Chapter, the goods or services or both supplied on or after the appointed day in pursuance of a contract entered into prior to the appointed day shall be liable to tax under the provisions of this Act.

286

Hee usta, fet 12 YA 2017 528 (285) 32 of 1994

' 20 of 2002

32 of 1994

(11) (a) Notwithstanding anything contained in section 12, no tax shall be payable on goods under this Act to the extent the tax was leviable on the said goods under the Madhya Pradesh Vat Act, 2002 (No.20 of 2002);

(b) Notwithstanding anything contained in section 13, no tax shall be payable on services under this Act to the extent the tax was leviable on the said services under Chapter V of the Finance Act, 1994;

(c) Where tax was paid on any supply, both under the Madhya Pradesh Vat Act, 2002(No. 20 of 2002) and under Chapter V of the Finance Act, 1994, tax shall be leviable under this Act and the taxable person shall be entitled to take credit of value added tax or service tax paid under the existing law to the extent of supplies made after the appointed day and suchcredit shall be calculated in such manneras maybeprescribed.

(12) Where any goods sent on approval basis, not earlier than six months before the appointed day, are rejected or not approved by the buyer and returned to theseller on or after the appointed day, no tax shall be payable thereon if such goods are returned within six months from the appointed day:

Provided that the said period of six months may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding two months: .

Provided further that the tax shall be payable by the person returning the goods if such goods are liable to tax under this Act, and are returned after the period specified in this sub-section:

Provided also that tax shall be payable by the person whohas sent the goods on approval basis if such goods are liable to tax under this Act, and are not returned within the period specified in this sub-section.

(13) Where a supplier has made any sale of goods in respect of which tax was required to be deducted at source under the Madhya Pradesh

287

528 (286) Reames wssa, feaie 12 FA 2017 Vat, 2002(No. 20 of 2002) and has also issued an invoice for the same before the appointed day, no deduction of tax at source under section 51 shall be made by the deductor under the said section where paymentto the said supplier is made on or after the appointed day.

(14) Where any goodsorcapital goods belonging to the principal are lying at the premises of the agent on the appointed day,the agentshall be entitled to take credit of the tax paid on such goodsorcapital goods subject to fulfilment of the following conditions:

(i) the agent is a registered taxable person underthis Act;

(ii) both the principal and the agent declare the details of stock of goodsor capital goods lying with such agent on the day immediately preceding the appointed day in such form and mannerand within such time as may be prescribed in this behalf;

(iii) the invoices for such goodsorcapital goods had been issued not earlier than twelve months immediately preceding the appointed day; and

(iv) the principal has either reversed or not availed of the input tax credit in respect of such,-

(a) goods; or

(b) capital goodsor, having availed of such credit, has reversed the said credit, to the extent availed of by him. |

CHAPTER XXI

MISCELLANEOUS

143. (1) A registered person (hereafter in this section Job work procedure. referred to as the "principal") may, under intimation and subject to such conditions as may be prescribed, send any inputsor capital goods, without payment of

tax, to a job worker for job work and from there

subsequently send to another job workerand likewise, and shall,—

(a) bring back inputs, after completion ofjob work or otherwise, or capital goods, other than moulds and dies, jigs and fixtures, or tools, within one year and

288

Hee wera, feat 12 SA 2017 528 (287) three years, respectively, of their being sent out, to any ofhis place of business, without paymentoftax;

(b) supply such inputs, after completion of job work or otherwise, or capital goods, other than moulds and dies, jigs and fixtures, or tools, within one year and three years, respectively, of their being sent out from the place of business of a job worker on payment of tax within India, or with or without paymentoftax for export, as the case maybe:

Provided that the principal shall not supply the goods from the place of business of a job worker in accordance with the provisions of, this clause unless the said principal declares the place of business of the job workerashis additional place of business except in a case-

(i) where the job worker is registered under section 25; or |

(ii) where the principal is engaged in the supply of such goods as may be notified by the Commissioner.

(2) The responsibility for keeping proper accounts for the inputs or capital goods shall lie with the principal.

(3) Where the inputs sent for job work are not received back by the principal after completion of job work or otherwise in accordance with the provisions of clause (a) of sub-section (1) or are not supplied from the place of business ofthe job worker in accordance with the provisions of clause (b) of sub-section (1) within a period of one yearoftheir being sent out, it shall be deemedthat such inputs had been supplied by the principal to the job worker on the day when the said inputs were sentout.

(4) Where the capital goods, other than moulds and dies, jigs and fixtures, or tools, sent for job work are not received back by the principal in accordance with the provisions of clause (a) of sub-section (1) or are not supplied from the place

289

528 (288) eager usa, fetish 12 YA 2017 of business of the job worker in accordance with the provisions of clause (b) of sub-section (1) within a period of three years of their being sent out, it shall be deemed that such capital goods had been supplied by the principal to the job worker on the day whenthe said capital goods were sent out.

(5) Notwithstanding anything contained in sub- sections (1) and (2), any waste and scrap generated during the job work may be supplied by the job worker directly from his place of business on payment of tax, if such job worker is registered, or by the principal, if the job workeris notregistered.

Explanation. - For the purposes of job work, input includes intermediate goodsarising from any treatment or process carried out on the inputs by the principal or the job worker.

144. Where any document-

(i) is produced by any person underthis Act or any other law for the time being in force; or

(ii) has been seized from the custody or control of any person under this Act or any other law for the time being in force; or

(iii) has been received from anyplace outside India in thecourse of any proceedings under this Act or any other law for the time being in force, and such documentis tendered by the prosecution in evidence against him or any other person whoistried jointly with him,the court shall--

(a) unlessthe contrary is proved by such person, presume —

(i) the truth of the contents of such document; Presumption as to

documents in certain ©

cases.

290

Hee usta, feats 12 FA 2017

(ii) that the signature and every other part of such document which purports to be in the handwriting of any particular person or which the court may reasonably assumeto have been signed by, or to be in the handwriting of, any particular person, is in that person's handwriting, and in the case of a document executed or attested, that it was executed or attested by the person by whom it purports to have been so executed orattested;

(b) admit the document in evidence notwithstanding that it is not duly stamped, if such documentis otherwise admissible in evidence.

145. (1) Notwithstanding anything contained in any other law for the time being in force, —

(a) a micro film of a documentor the reproduction of the image or images embodied in such micro film (whether enlarged or not); or

(b) a facsimile copy of a document; or

(c) astatement contained in a document and included in a printed material produced by a - computer, subject to such conditions as may be prescribed; or

(d) any information stored electronically in any device or media, including any hard copies madeofsuch information,

shall be deemed to be a documentfor the purposesofthis Act and the rules made thereunderand shall be admissible in any proceedings thereunder, without further proof or production ofthe original, as evidence of any contents of the original or of any fact stated therein of which direct evidence would be admissible.

(2) In any proceedings under this Act and orthe rules made thereunder, where it is desired to give a

528 (289)

Admissibility of micro films, facsimile copies of documents and computer printouts as documents and as evidence.

291

528 (290) Fegan ustaa, fetie 12 YA 2017 statement in evidence by virtue of this section, a certificate, —

(a) identifying the documentcontaining the statement and describing the manner in which it was produced;

(b) giving such particulars of any device involved in the production of that document as may be appropriate for the purpose of showing that the document was produced by a computer,

shall be evidence of any matter stated in the certificate and for the purposes of this sub-section it shall be sufficient for a matter to be stated to the best of the _ knowledge andbelief of the person statingit.

146. The Government may, on the recommendations of the Council, notify the Common Goods and Services Tax Electronic Portal for facilitating registration, paymentoftax, furnishing of returns, computation and settlement of integrated tax, electronic way bill and for carrying out such other functions and for such purposes as maybe prescribed.

147. The Government may, on the recommendations of the Council, notify certain supplies of goods as

"deemed exports", where goods supplied do not leave India, and payment for such supplies is received either in Indian rupeesor in convertible foreign exchange,if such goods are manufactured in India.

148. The Government may, on the recommendations of the Council, and subject to such conditions and safeguards as may be prescribed, notify certain classes of registered persons, and the special procedures to be followed by such persons including those with regard to registration, furnishing of return, payment of tax and administration ofsuch persons.

149. (1) Every registered person may be assigned a goods andservices tax compliance rating score by the Government based on his record of compliance with the provisions ofthis Act.

CommonPortal.

Deemed Exports.

Special procedure for

certain processes.

Goods and services tax

compliance rating.

292

Hee Usa, fetth 12 YA 2017 528 (291) 43 of 1961.

2 of 1934.

36 of 2003.

16 of 1908.

18 of 2013.

59 of 1988.

(2) The goods and services tax compliance rating score may be determined on the basis of such parameters as may beprescribed.

(3) The goods and services tax compliance rating score may be updated at periodic intervals and intimated to the registered person andalso placed in the public domain in such manner as may be prescribed.

150. (1) Any person, being—

(a) a taxable person; or

(b) a local authority or other public body or association; or

(c) any authority of the State Government responsible for the collection of value added tax or sales tax or State excise duty or an authority of the Central Government responsible forthe collection of excise duty or customsduty; or

(d) an income tax authority appointed under the provisions ofthe Income-tax Act, 1961; or

(e) a banking company within the meaning of clause (a) of section 45A of the Reserve Bank of India Act, 1934; or

(f) a State Electricity Board or an electricity distribution or transmission licensee under the Electricity Act, 2003, or any other entity entrusted with such functions by the Central Government or the State Government; or

(g) the Registrar or Sub-Registrar appointed under section 6 of the Registration Act, 1908;or

(h) a Registrar within the meaning of the Companies Act, 2013; or

(i) the registering authority empowered to register motor vehicles under the Motor Vehicles Act, 1988; or

(j) the Collector referred to in clause (c) of section 3 of the Right to Fair Compensation and Obligation to furnish

information return.

293

528 (292) ^HeeUTA,feria^12YA2017 y

30 of 2013.

42of 1956.

22 of 1996.

2 of 1934,

18 of 2013.

Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013; or

(k) the recognised stock exchange referred to in clause (f) of section 2 of the Securities Contracts (Regulation) Act, 1956; or

(1) a depository referred to in clause (e) of sub- section (1) of section 2 of the Depositories Act, 1996; or

(m) an officer of the Reserve Bank of India as constituted under section 3 of the Reserve Bank of India Act, 1934; or

(n) the Goods and Services Tax Network, a company registered under the Companies Act, 2013; or

(0) a person to whom a Unique Identity Number has been granted under sub-section (9) of section 25; or

(p) any other person as may be specified, on the recommendations of the Council, by the Government,

who is responsible for maintaining record of registration or statement of accounts or any periodic return or document containing details of payment of tax and other details of transaction of goods or services or both or transactions related to a bank account or consumption of electricity or transaction of purchase, sale or exchangeof - goodsor property or right or interest in a property under any law for the time being in force, shall furnish an information return of the same in respect of such periods, within such time, in such form and manner and to such authority or agency as maybeprescribed.

(2) Where the Commissioner, or an officer authorised by him in this behalf, considers that the information furnished in the information return is defective, he may intimate the defect to the person who has furnished such information return and give him an opportunity of rectifying the defect within a period of thirty days from the date of

294

Heer usa, feat 12 FA 2017 such intimation or within such further period which, on an application made in this behalf, the said authority may allow and if the defect is not rectified within the said period of thirty days or, the further period so allowed, then, notwithstanding anything contained in any other provisions of this Act, such information return shall be treated as not furnished and the provisions of this Act shall apply.

(3) Where a person who is required to furnish information return has not furnished the same within the time specified in sub-section (1) or sub- section (2), the said authority may serve upon him a notice requiring furnishing of such information return within a period not exceeding ninety days from the date of service of the notice and such person shall furnish the information return.

151. (1) The Commissioner may,if he considers that it is necessary so to do, by notification, direct that statistics may be collected relating to any matter dealt with by or in connection with this Act. (2)Upon such notification being issued, the Commissioner, or any person authorised by him in this behalf, may call upon the concerned persons to furnish such information or returns, in such form and manner as maybeprescribed, relating to any matter in respect of which statistics is to be collected.

152. (1) No information of any individual return or part thereof with respect to any matter given for the purposes of section 150 or section 151 shall, without the previous consent in writing of the concerned person or his authorised representative, be published in such manner so as to enable such particulars to be identified as referring to a particular person and no such information shall be used for the purpose of any proceedings underthis Act.

(2) Except for the purposes of prosecution under this Act or any other Act for the time being in force, no person whois not engagedin the collection ofstatistics under this Act or compilation or computerisation thereof for

528 (293)

Power. to collect Statistics.

Bar on disclosure of information.

295

528 (294)

'S of 1860. Hee waa, feats 12 FA 2017 the purposes of this Act, shall be permitted to see or have access to any information or any individual return referred to in section 151.

(3) Nothing in this section shall apply to the publication of any information relating to a class of taxable personsor class of transactions,if in the opinion of the Commissioner, it is desirable in the public interest to publish such information.

153. Any officer not below the rank of Assistant - Commissioner may, having regard to the nature and complexity of the case and the interest of revenue, take assistance of any expert at any stage of scrutiny, inquiry, investigation or any other proceedings before him.

154, The Commissioneror an officer authorised by him may take samples of goods from the possession of any taxable person, where he considers it necessary, and provide a receipt for any samples so taken.

155. Where any person claims that he is eligible for input tax credit under this Act, the burden of proving such claim shall lie on such person.

156. All persons discharging functions under this Act shall be deemed to be public servants within the meaning of section 21 of the Indian Penal Code.

157. (1) Nosuit, prosecution or other legal proceedings shall lie against the President, State President, Members, officers or other employees of the Appellate Tribunal or any other person authorised by the said Appellate Tribunal for anything which is in good faith doneor intended to be done underthis Act or the rules made thereunder.

(2) No suit, prosecution or other legal proceedings shall lie against any officer appointed or authorised under this Act for anything which is done or intended to be done in good faith under this Act or the rules made thereunder.

158. (1) All particulars contained in any statement made, return furnished or accounts or documents produced in accordance with this Act, or in any record Taking assistance from

an expert.

Powerto take samples.

Burdenofproof.

Persons deemed to be

public servants.

Protection of action

taken underthis Act.

Disclosure of

information by a public:

servant.

296

1 of 1872. 45 of 1860. 49 of 1988. Hee UAT, fete 12 FA 2017 of evidence given in the course of any proceedings under this Act (other than proceedings before a criminal court), or in any record of any proceedings under this Act shall, save as provided in sub-section (3), not be disclosed.

(2) Notwithstanding anything contained in the Indian Evidence Act, 1872, no court shall, save as otherwise provided in sub-section (3), require any officer appointed or authorised under this Act to produce before it or to give evidence before it in respect of particulars referred to in sub-section

(1).

(3) Nothing contained in this section shall apply to the disclosure of,—

(a) any particulars in respect of any statement, return, accounts, documents, evidence, affidavit or deposition, for the purpose of any prosecution under the Indian Penal Code or the Prevention of Corruption Act, 1988, or any other law for the time being in force; or

(b) any particulars to the Central Government or the State Governmentor to any person acting in the implementation of this Act, for the purposes of carrying out the objects of this Act; or

(c) any particulars when such disclosure is occasioned by the lawful exercise under this Act of any process for the service of any notice or recovery of any demand; or

(d) any particulars toa civil court in any suit or proceedings, to which the Government or any authority under this Act is a party, which relates to any matter arising out of any proceedings under this Act or under any other law for the time being in force authorising any such authority to exercise any powers thereunder; or

e

(e) any particulars to any officer appointed for the purpose of audit of tax receipts or refunds of the tax imposed bythis Act; or

(f) any particulars where such particulars are relevant for the purposes of any inquiry into the

528 (295)

297

528 (296) Hee usa, feat 12 FA 2017 conduct of any officer appointed or authorised under this Act, to any person or persons appointed as an inquiry officer under any law for the time being in force; or

(g) any such particulars to an officer of the Central Government or of any State Government, as may be necessary for the purpose of enabling that Governmentto levy orrealise any tax or duty; or

(h) any particulars when such disclosure is occasioned by the lawful exercise by a public servant or any otherstatutory authority,-of his or its powers under any law for the time being in force; or

(i) any particulars relevant to any inquiry into a charge of misconduct in connection with any proceedings under this Act against a practising advocate, a tax practitioner, a practising cost accountant, a practising chartered accountant, a practising company secretary to the authority empowered to take disciplinary action against the members practising the profession of a legal practitioner, a cost accountant, a chartered accountant or a companysecretary, as the case may be; or

(j) any particulars to any agency appointed for the purposes of data entry on any automated system or for the purpose of operating, upgrading or maintaining any automated system where such agency is contractually bound notto use or disclose such particulars except for the aforesaid purposes; or

(k) any such particulars to an officer of the Government as may be necessary for the purposes of any other law for the time being in force; and

(1) any information relating to any class of taxable persons or class oftransactions for publication,if, in the opinion of the Commissioner, it is desirable in the public interest, to publish such information.

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Ree Usa, feria 12 FA 2017

159. (1) If the Commissioner, or any other officer authorised by him in this behalf, is of the opinion that it is necessary or expedient in the public interest to publish the name of any person and any other particulars relating to any proceedings or prosecution under this Act in respect of such person, it may cause to be published such name and particulars in such manneras it thinksfit.

(2) No publication underthis section shall be made in relation to any penalty imposed under this Act until the time for presenting an appeal to the Appellate Authority under section 107 has expired without an appeal having been presented or the appeal, if presented, has been disposedof. Explanation.—In the case of firm, company or other association of persons, the names of the partners of the firm, directors, managing agents, secretaries and treasurers or managers of the company, or the members of the association, as the case may be, may also be published if, in the opinion of the Commissioner, or any other officer authorised by him in this behalf, circumstances of the casejustify it.

160. (1) No assessment, re-assessment, adjudication, review, revision, appeal, rectification, notice, summonsor other proceedings done, accepted, made, issued, initiated, or purported to have been done, accepted, made,issued,initiated in pursuance of any of the provisions of this Act shall be invalid or deemedto be invalid merely by reason of any mistake, defect or omission therein, if such assessment, re- assessment, adjudication, review, revision, appeal, rectification, notice, summons or other proceedings are in substance and effect in conformity with or according to the intents, purposes and requirements of this Act or any existing law.

(2) The service of any notice, order or communication shall not be called in question, if the notice, order or communication, as the case may be,has already been acted upon by the person to whom it is issued or where such service has not been called in question at or in the earlier proceedings commenced, continued or finalised pursuant to such notice, order or communication.

Publication of

information in respect

of persons in certain

cases.

Assessment

proceedings, etc. not to

be invalid on certain

grounds.

528 (297)

299

528 (298) Hemme usa, fei 12 FA 2017

161. Without prejudice to the provisions of section 160, Rectification of errors - and notwithstanding anything contained in any other apparent on the face of provisions of this Act, any authority, who has passed record. or issued any decision or order or notice or certificate

or any other document, mayrectify any error whichis

apparent on the face of record in such decision or

order or notice or certificate or any other document,

either on its own motion or where such error is

brought to its notice by any officer appointed under

this Act or an officer appointed under the Central

Goods and Services Tax Act or by the affected person

within a period of three months from the date of issue

of such decision or orderor notice or certificate or any

other document, as the case maybe:

Provided that no suchrectification shall be done after a

period of six months from the date of issue of such

decision or order or notice or certificate or any other

document: ..

Provided further that the said period of six months

shall not apply in such cases where the rectification is

purely in the nature of correction of a clerical or

arithmetical error, arising from any accidental slip or

omission:

Provided also that where such rectification adversely

affects any person, the principles of natural justice shall be followed by the authority carrying out. such

rectification.

162. Save as provided in sections 117 and 118, no civil Bar on jurisdiction of court shall have jurisdiction to deal with or decide any civil courts. question arising from or relating to anything done or

purported to be done underthis Act.

163. Wherever a copy of any order or documentis to be_ Levyoffee. provided to any person on an application made by him for that purpose, there shall be paid such fee as may be prescribed.

164. (1) The Government may, on the Power of Government recommendations of the Council, by notification, to makerules. makerules for carrying out the provisions of this Act.

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Heqgen ustaa, feria 12 FA 2017

(2) Without prejudice to the generality of the provisions of sub-section (1), the Government may makerulesforall or any of the matters which by this Act are required to be, or may be, prescribed or in respect of which provisions are to be or may be madebyrules.

(3) The power to make rules conferred by this section shall include the powerto give retrospective effect to the rules or any of them from a date not earlier than the date on which the provisions of this Act comeinto force.

(4) Any rules made under sub-section (1) or sub- section (2) may provide that a contravention thereof shall be liable to a penalty not exceeding ten thousand rupees.

165. The Government may, by notification, make regulations consistent with this Act and the rules made thereunderto carry out the provisionsof this Act.

166. Every rule made by the Government, every regulation made by the Government and every notification issued by the Government underthis Act, shall be laid, as soon as may be after it is made or issued, before the State Legislature, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, the State Legislature agrees in making any modificationin the rule or regulation orin the notification, as the case may be, or the State Legislature agrees that the rule or regulation or. the notification should not be made, the rule or regulation or notification, as the case may be, shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule or regulation or notification, as the case may be.

167. The Commissioner may, by notification, direct that subject to such conditions, if any, as may be specified in the notification, any powerexercisable by

528 (299)

Power to make regulations. Layingofrules, regulations and notifications. Delegation ofpowers.

301

528 (300) Awe UIA, feat 12 YA 2017 any authority or officer under this Act may be exercisable also by another authority or officer as may be specified in such notification.

168. The Commissioner may, if he considers it Powerto issue necessary or expedient so to do for the purpose of instructions or uniformity in the implementation of this Act, issue directions. such orders, instructions or directions to the State tax officers as it may deem fit, and thereupon all such officers and all other persons employed in the implementation of this Act shall observe and follow such orders,instructions ordirections.

169. (1) Any decision, order, summons, notice or other Service of notice in communication under this Act or the rules made certain circumstances. thereundershall be served by any one of the following methods, namely:--

(a) by giving or tendering it directly or by a messenger including a courier to the addressee or the taxable person or to his manager or authorised representative or an advocate or a tax practitioner holding authority to appear in the proceedings on behalf of the taxable person or to a person regularly employed by him in connection with the business, or to any adult memberof family residing with the taxable person; or

(b) by registered post or speed post or courier with acknowledgement due, to the person for whom itis intended or his authorised representative,if any, at his last known place of business or residence; or

(c) by sending a communication to his e-mail address provided at the time of registration or as amended from time to time; or

(d) by making it available on the commonportal; or

(e) by publication in a newspapercirculating in the locality in which the taxable person or the person to whomit is issued is last known to have resided, carried on business or personally worked for gain; or

302

Ree Usa, feta 12 FA 2017

(f) if none of the modes aforesaid is practicable, by affixing it in some conspicuousplace at his last known place of business or residence and if such mode is not practicable for any reason, then by affixing a copy thereof on the notice board of the office of the concerned officer or authority who or which passed such decision or order or issued such summons or notice.

(2) Every decision, order, summons, notice or any communication shall be deemed to have been served on the date on which it is tendered or published or a copy thereof is affixed in the mannerprovided in sub-section (1).

(3) When such decision, order, summons, notice or any communication is sent by registered post or speed post, it shall be deemed to have been received by the addressee at the expiry of the period normally taken by such post in transit unless the contrary is proved.

170. The amount oftax, interest, penalty, fine or any other sum payable, and the amount of refund or any other sum due, under the provisions of this Act shall be rounded off*to the nearest rupee and, for this purpose, where such amount containsa part of a rupee consisting of paise, then, if such part is fifty paise or more, it shall be increased to one rupee and if such part is less than fifty paise it shall be ignored.

171. (1) Anyreduction in rate of tax on any supply of goods or services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices.

(2) The Central Government may, on recommendations of the Council, by notification, constitute an Authority, or empower an existing Authority constituted under any law for the time being in force, to examine whether input tax -eredits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the price of the goods or services or both supplied by him.

528 (301)

Rounding off of tax etc. Anti-profiteering measure.

303

528 (302) Hee Usa, fei 12 FA 2017

(3) The Authority referred to in sub-section (2) shall exercise such powers and discharge such functions as may beprescribed.

172. (1) If anydifficulty arises in giving effect to any provisions of this Act, the Government. may, on the recommendations of the Council, by a general or a special order published in the Official Gazette, make such provisions not inconsistent with the provisions of this Act or the rules or regulations made thereunder, as may be necessary or expedient for the purpose of removingthe said difficulty:

Provided that no such order shall be made after the expiry of a period of three years from the date of commencementofthis Act.

(2) Every order made underthis section shall be laid, as soon as may be,after it is made, before the State Legislature.

MP Act 173. Save as otherwise provided in this Act, on and No.20 of from the date of commencement of whole or any part 2002 of this Act, except for the entries of the goods in Schedule I and Schedule II of the Madhya Pradesh Vat Act, 2002 (No. 20 of 2002) relating to the goods specified under entry 54 of the State List in the Seventh Schedule to the Constitution of India and provisions relating to such goods in the said Act, all other entries in the Schedule I and Schedule I] and the provisions relating to other goods in the Madhya Pradesh Vat Act, 2002 (No. 20 of 2002) shall stand omitted.

174. (1) Save as otherwise provided in this Act, on and from the date of commencementof whole or any part of this Act,

(i) the Madhya Pradesh Sthaniya Kshetra Me Mal Ke Pravesh Par Kar Adhiniyam, 1976 (Act No. 52 of 1976)

(ii) the Madhya Pradesh Vilasita, Manoranjan, Amod Evam Vigyapan Kar Adhiniyam, 2011 (Act No. 11 of 2011)

Removalofdifficulties.

Amendment of certain

Acts

Repeal and saving.

(hereafter referred to as the repealed Acts) are hereby repealed.

304

2)

(3)

Regge usa, fede 12 YA 2017 528 (303) The repeal of the said Acts and the amendmentofthe Acts specified in section 173 (hereafter referred to as "such amendment" or "amended Act", as the case maybe)to the extent mentioned in sub-section (1) or section 173 shall not—

(a) revive anything notin force or existing at the time of such amendment or repeal; or

(b) affect the previous operation of the amended Acts or repealed Acts and orders or anything duly done or suffered thereunder; or

(c) affect any right, privilege, obligation, or liability acquired, accrued or incurred under the amended Acts or repealed Acts or orders under such repealed Acts:

Provided that any tax exemption granted through a notification under the amended Act or repealed Acts shall not continue as privilege; or

(d) affect any tax, surcharge, penalty, interest as are due or may become due or any forfeiture or punishmentincurred orinflicted in respect of any offence or violation committed against the provisions of the amended Act or repealed Acts; or

(e) affect any investigation, inquiry, assessment proceedings and any other legal proceedings or recovery of arrears or remedy in respect of any such tax, surcharge, penalty, fine, interest, right, privilege, obligation, liability, forfeiture or punishment, as aforesaid, and any such investigation, inquiry, assessment proceedings and other legal proceedings or recovery of arrears or remedy may be instituted, continued or enforced, and any such tax, surcharge, penalty, fine, interest, forfeiture or punishment may be levied or imposedas if these Acts had not been so amended or repealed;

(f) affect any proceedings including that relating to an appeal, revision, review or reference, instituted before, on or after the appointed day under the said amended Act or repealed Acts or the rules made thereunder and such proceedings shall be continued under the said amended Acts or repealed Acts as if this Act had not comeinto force and the said Acts had not been amendedorrepealed.

The mention of the particular matters referred to in section 173 and sub- section (1) shall not be held to prejudice or affect the general application of the Madhya Pradesh General Clauses Act, 1957 (No. 3 of 1958) with regard to the effect ofrepeal.

305

528 (304) Heme usta, fers 12 YA 2017

SCHEDULEI

[See section 7]

ACTIVITIES TO BE TREATED AS SUPPLY EVEN IF MADE

WITHOUT CONSIDERATION

1. Permanent transfer or disposal of business assets where input tax credit has been availed on suchassets.

2. Supply of goods or services or both between related persons or between distinct persons as specified in section 25, when made in the course or furtherance of business:

Provided that gifts not exceeding fifty thousand rupees in value in a financial year by an employer to an employee shall not be treated as supply of goodsor services or both.

3. Supply of goods—

(a) by a principal to his agent where the agent undertakes to supply such goods on behalfofthe principal; or

(b) by an agent to his principal where the agent undertakes to _ receive such goods on behalfofthe principal.

4. Import of services by a taxable person from a related person or from any ofhis other establishments outside India, in the course or furtherance of business.

SCHEDULEII.

[See section 7]

ACTIVITIES TO BE TREATED AS SUPPLY OF GOODS OR

SUPPLY OF SERVICES

1. Transfer

(a) any transferofthe title in goods is a supply of goods;

(b) any transfer of right in goods or of undivided share in goods withoutthe transferoftitle thereof, is a supply of services;

(c) anytransfer oftitle in goods under an agreement which stipulates that property in goods shall pass at a future date upon paymentoffull consideration as agreed, is a supply of goods.

306

Here wstaa, fetis 12 FA 2017 528 (305)

2. Land and Building

(a) any lease, tenancy, easement, licence to occupy land is a supply of services;

(b) any lease or letting out of the building including a commercial, industrial or residential complex for business or commerce, either wholly or partly, is a supply of services.

3. Treatment or process Any treatment or process which is applied to another person's goodsis a supply ofservices.

4. Transfer. of business assets

(a) where goods forming part of the assets of a business are transferred or disposed of by or under the directions of the person carrying on the business so as no longer to form part of those assets, whether or not for a consideration, such transfer or disposal is a supply of goods by the person;

(b) where, by or underthe direction of a person carrying on a business, goods held or used for the purposes of the business are put to any private use or are used, or made available to any person for use, for any purpose other than a purpose of the business, whether or not for a consideration, the usage or making available of such goodsis a supply of services;

(c) where any person ceasesto be a taxable person, any goods forming part of the assets of any business carried on by him shall be deemed to be supplied by him in the course or furtherance of his business immediately before he ceases to be a taxable person, unless—

(i) the business is transferred as a going concern to another person; or

(ii) the business is carried on by a personal representative whois deemedto be a taxable person.

5. Supply of services The following shall be treated as supply of service, namely:-

(a) renting of immovable property;

(b) construction of a complex, building, civil structure or a part thereof, including a complex or building intended for. sale to a buyer, wholly or partly, except where the entire consideration has been received after issuance of completion certificate, where required, by the competent

307

528 (306) ^{Heews,fete12FA2017} 20 of 1972

authority or afterits first occupation, whicheveris earlier. Explanation.—Forthe purposes of this clause—

(1) the expression "competent authority" means the Governmentor any authority authorised to issue completion certificate under any law for the time being in force and in case of non-requirement of such certificate from such authority, from any of the following, namely:—

(i) an architect registered with the Council of Architecture constituted under the Architects Act, 1972; or _ (ii) a chartered engineer registered with the Institution o Engineers (India); or :

(iii) a licensed surveyorof the respective local body ofthe city or town orvillage or developmentor planning authority;

(2) the expression "construction" includes additions, alterations, replacements or remodeling of any existing civil structure;

(c) temporary transfer or permitting the use or enjoyment of any intellectual property right; :

(d)development, design, programming, customisation, adaptation, upgradation, enhancement, implementation of information technology software;

(e)agreeingto the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act; and

(f) transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred paymentor other valuable consideration.

6. Composite supply The following composite supplies shall be treated as a supply of services, namely:—

(a) works contract as defined in clause (119) of section 2; and

(b) supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for

308

Heme wera, fette 12 YA 2017 persons to a memberthereof for cash, deferred payment or other valuable consideration.

SCHEDULEIII

[See section 7]

ACTIVITIES OR TRANSACTIONS WHICH SHALL BE

TREATED NEITHER AS A SUPPLY OF GOODS NOR A

SUPPLY OF SERVICES

1, Services by an employee to the employer in the course ofor in relation to his employment.

2. Services by any court or Tribunal established under any law for the time beingin force.

3.(a) the functions performed by the Members of Parliament, Members of State Legislature, Members of Panchayats, Members of Municipalities and Membersofotherlocal authorities;

(b) the duties performed by any person who holds any post in pursuanceofthe provisions of the Constitution in that capacity; or

(c) the duties performed by any person as a Chairperson or a Member or a Director in a body established by the Central Government or a State Governmentor local authority and who is not deemed as an employee before the commencementofthis clause.

4, Services of funeral, burial, crematorium or mortuary including transportation of the deceased.

5. Sale of land and, subject to clause (b) of paragraph 5 of Schedule I], saleof building.

6. Actionable claims, other than lottery, betting and gambling. Explanation.—For the purposes of paragraph 2, the term "court"

includes District Court, High Court and Supreme Court.

528 (307)

Preah, Wrens ART ce Ca Sa, Tee STO HTS hala QUT, ATT A Alaa cet wepteI—2017.

309