" Courtsey MVAT Study Circle Facebook Group"

QUESTION

Pharma Co Registered Under VAT voluntarily in MAY 2009.
Company has purchases of Fixed assets, Consumables and Parts of fixed assets , Feed and vaccines, medicines of Horses(Co has maintained horses for testing Vaccines)
Company has no Production or sales till 2013-14
Company has Claimed Set off only on Consumables and parts of fixed assets Feed and vaccines for horses and other Expenses in year 2010-11 and 2011-12(All those expenses are debited to P/L account). But Company has not claimed set off on Fixed Assets for the same period.
Whether company is eligible to claim set off On expenses for above periods ?Whether Set off not claimed on Fix Assets can be allowed in assessment for the concerned period? Please guide with referece to rule 53(6) second proviso

ANSWER-

Think on these lines:
Think of set off on each of the following items separately:
1) Capital assets,
2)parts of fixed assets
3) Feed for horses
4) Vaccines for horses
5) Other expenses (look at items of expenditure)
Dont club all these purchases together. (You know what i want to say)
Now read Rule 53(6) Proviso and revert back.
Even i need time to think. this is one of the best questions so far.

QUESTION 

Sir , In my opinion in this case dealer is eligible to claim set off on capital Assets for first three years from Registration ie 09-10,10-11 &11-12 . But dealer has not claimed it . Instead dealer has claimed set of on---a)Vaccines and feed for horses b) on components of fixed Assets c) other expenses such as stationery etc. my questions are weather dealer is eligible to claim set off on these three expenses debited to P/L account? and weather Set off not claimed by dealer on capital assets can be allowed in assessment?

ANSWER-

Pl read rule 52(1) to decide whether the assessing authority can grant set off in general.
Secondly, set off on expenses debited to PL account would not be admissible.

QUESTION

Sirji...Is there any difference between O. M. S sales and Interstate trade??

ANSWER

Actually, the term, "OMS Sale" is very loosely used by us. As per the CST Act, this is "OMS Sale" is a "sale outside the state" (Sec. 4), and CST cannot be levied on such sale . CST can be levied only on sales in the course of inter state trade and commerce, which is under sec. 3(a) and 3(b).

QUESTION

sir plz guide about terms & condition to filed revised returns for perid 2008_2009

ANSWER

 i dont think that anybody can file a return or revised return after the limitation period for assessment is over, i.e. for 2008-09.

QUESTION

what is the difference between custom duty and excise duty

ANSWER

Custom duty also known as tariff is levied on imports while excise duty is levied on manufactured goods or simply on production of goods.
Both r indirect taxes levied by customs & excise dept respectively.

QUESTION

Sir, if C form issued date is 5 april 2008 and sales invoice date is 12 march 2009 then whether I should allow this CST transaction or not, on my point of view it should not be allowed pls, guide me sir

ANSWER

Some of the states are issuing declaration manually as per consumption and requirement basis. In your case declaration may be issued for the financial year 01/04/2008 to 31/03/2009 or for April 2008 or April to June08 or for previous Year.Technically declaration must be as per requirement, and these are the manual of procedure. It is very difficult to disallow such declaration because if any state issues ad hoc basis for year then there is no restriction under CST Act. if you want to verify genuineness of transaction cross checking is the best option for You.

 right. check whether that state is issuing forms in advance for the period before you. Besides, you should be always careful to verify other details on the C form and also the transport proofs.

QUESTION

SIR, A DEALER RESELLER IN IRON & STEEL. COMMENCING BUSINESS FROM 1ST APRIL 13 AND COMPLETED THRESHOLD LIMIT ON 15/4/13. APPLIED FOR R.C. ON 13/4/13 (i.e. INTIME) TILL TODAY DUE TO PROCESSING OF APPLICATION / VERIFICATION & THEREAFTER PRE-VISIT. DEALER HAS NOT YET GET TIN. DEALER HAS TO SUBMIT FIRST RETURN QUARTERLY i.e. BEFORE 31/7/13. IF TIN IS NOT GRANTED BEFORE 31/7/13, DEALER COULD NOT SUBMIT RETURN IN TIME & HE HAS TO PAY LATE FEE. DEALER IS LIABLE TO PAY TAX ON SALES AFTER 15/4/13, BUT HE COULD NOT COLLECT UNLESS TIN IS GRANTED. IT IS TRUE STO REGN WILL GRANT HIM TIM W.E.F. 15/4/13 BUT UNLESS TIN GRANTED TO HIM HE COULD NOT COLLECT TAX.
SIR, IS THERE ANY PROVISION IN FAVOUR OF DEALER TO EXEMPT FROM LATE FEE AND TO COLLECT TAX BEFORE GRANT R.C. (15/4/13). PL DISCUSS

ANSWER

Pl read the first proviso of sec. 16(1). As per sec. 16(1), a dealer, who is liable to pay tax cannot carry on business, unless he possesses RC. However, if a dealer has applied for RC, then it is not considered as a contravention. i feel that if a dealer has applied for RC, then he would not be barred from collecting tax.
Secondly, as regards late fee, in the recent amendment (which we had discussed during Budget), the state government is empowered to exempt late fee by issuing notificaion for certain classes of dealers. This notification is expected shortly.

QUESTION

Sirji,what is difference between powers vested and delegated ?which powers are vested within S.T.O.

ANSWER

 i am not sure if there is any difference between the two terms.
As far as the MVAT Act is concerned, the Act vests almost all the powers in the Commissioner and the Commissioner delegates the powers to the subordinate authorities. The powers to delegate are vested with the Commissioner u/s 10 and these powers are kept with the Commissioner himself.

QUESTION

What will be the effect of "scheme discount received" upon ITC?

case:--- Mr. A purchases fertilizer at Rs 1000 from Mr. B. So, Mr. A pays Rs 40 as tax. Thus, ITC claimed by Mr. A is Rs 40/- But, at later point of time, Mr. B gives a credit note of Rs 200 to Mr. A for the same transaction terming it as "scheme discount"

My contention is that Mr. A should get Rs 32 only as ITC, as due to scheme discount the purchase price gets reduced. 
But, the Mr. A , the dealer contends that the scheme discount received is passed on to the individual customers & therefore has no effect upon ITC.

QUESTION

sir is thre timebaring for the interest order under the Mvat Act

ANSWER

i think that the Limitation Act, 1963 is largely applicable to suits and such other civil proceedings. Recovery of tax is a sovereign function of the state. Limitation would apply, of course, where the recovery demand is required to be raised. For raising of statutory recovery demand, limitation periods have already been provided under the MVAT Act. So one cannot raise demand (pass a statutory order after limitation period), but once the demand is raised, there cannot be any limitation period for recovery. 
English Limitation Act (Sec. 37), expressly provides that the Act is applicable for proceedings by or against the Crown but at the same time it makes an exception for recovery of tax dues. Such express provision for applicability to Crown (Govt)could not be found in the Indian Law.
To conclude i feel that the interest can be recoverd at any time, because the interest becomes payable immediately on default and the liability is also crystalised immediately, no computation by the authority is required.

QUESTION

Effect of Sale of goods on loss upon ITC?

case:--- Mr. A purchases bio fertilizer for Rs 5000 & claims ITC Rs 200/- Later, due to bad market conditions he sells the same for Rs 4000/- Thus, on sale side he pays only Rs 160/- & claims ITC of Rs 200/- on purchase side. Thus, claiming refund of Rs 40/-

Is it right to allow ITC of Rs 200/- on such transaction or shall we only allow Rs 160/-

QUESTION

Sir pls guide me, two sister concern having seperate TIN preparing consolidated balancesheet and filed only one 501 for period 2010-11 on one TIN, is it possible? while processing refund application can we allow set off of other sister concern which is included in balancesheet

ANSWER

 NO. Remember that entity is important. The entity which purchases the goods is eligible for set off. Reliance may have 100 sister concerns, but then the set off is not transferable. A company which has a separate certificate of incorporation by the Registrar of Companies is a separate entity for us. Set off is not transferable.

QUESTION

pl guide about works contract in detail - turnover of sale, when any works contractor is liable to pay tax, deduction u/s 3(2),determination of exceeding t/o date,etc

ANSWER

You have asked your question in 3 lines, but an answer to it could run into thousand lines or rather thousand pages.
i shall try to make it as simple as possible.
As per the Constitution, we can levy tax on the sales of goods only. However, there are certain transactions, which are not purely sales of goods, ie. intention of the seller as well as the purchaser is not to sell or purchase the goods.
One such type of transaction is works contract, in which the buyer (called as employer under MVAT) wants a particular work done from the contractor (we can call him seller). While executing this work, some goods are transferred from the contractor to the employer, which is deemed to be sale of goods.
But as said earlier, in this deemed sale (legal fiction), we can legally tax only the sales price of goods. The contract price paid by the employer is, therefore, not a sales price price.
For example, if i give you a contract for painting my house say for Rs. 40000. in this case, the paint purchased by you would get transferred by you, but the contract price of Rs. 40000, which you would charged me is not only for the sale of paint, but it involves some other expenses like labour etc., on which we cannot levy VAT. 
Thus in this case, Rs. 40000 is the contract price but it is not your sales price.
Now the question would be how to arrive at the sales price ?
Supreme Court, in the case of Gannon Dunkerley, gave some guiding principles to arrive at the sales price. In short, you have to deduct some expenses to arrive at the sales price on the basis of contract price.
As far as MVAT is concerned, such deductions are provided in rule 58. So from the contract price, we have to deduct the expenses listed in Rule 58 and then what willremain shall be sales price or turnover of sales, in the strictest legal sense.
For the purpose of registration, to arrive at the sales price, we may have to calculate the sales price in this manner.
Now if you know the concept of sales price in a works contract, then the deduction u/s 3(2) would not be difficult to calculate.
The method above is the classical method to levy tax in works contract. However, all the contractors may not have maintained the accounts so that the expenses listed in Rule 58 can be clearly proved. Such dealer may claim deduction at a standard percentage given for each type of a contract in Rule 58 Table.
For the contractors, there are some simple methods for discharging their tax liability, which makes our life also simpler. These schemes are called composition schemes.
When a dealer opts for the composition scheme, then he has to pay composition amount on the entire contract price, without deductions under rule 58. Construction contractors pay composition at 5%, while other works contractors pay 8% on contract price.
For the developers, the composition amount payable is 1%. 
The set off treatment for each of the methods is different.
I would set this as home work, who desire to study works contract law. 
Is it Ok, Anil ....

QUESTION

sir can we allowed set off of consumables which is not use in execution of works contract but it is nesesaary for contract is there u\r 54 (h) applicable ex. for making a road dealer needs heavy vehicals it needs lubricant oil spare parts etc. can we give set off od this consumables

ANSWER

Good question. i Can see some efforts when you suggest Rule 54(h).
Remember, you are referring to three commodities i.e. heavy vehicles, lubricant oils and spare parts. So think about set off for each of these commodities separately.
Actually, i had so far thought that Rule 54 is meant to bar set off to a works contractor, who erects an immovable property for himself. But, after your question, i could see another dimension to rule 54(h).
Rule 54 says that no set off shall be granted on:
(h) purchases of any goods by a dealer, the property in which is not transferred (whether as goods or in some other form) to any other person, which are used in the erection of immovable property other than plant and machinery;
Now, the tricky part is that the Rule 54(a) bars set off on passenger vehicles, thus allowing set off on goods vehicles.
Rule 54(h) bars set off on purchase of any goods , which are not transferred.
i think that the property in heavy vehicles, lubricant oil and spare parts does not get transferred.
Prima facie i feel that set off shall not be admissible.
However, i would encourage debate on this topic and also welcome contrary views.
Anyway, Nilesh Kshirsagarji, this is one of those situations for which there is no easy answer.

QUESTION

Shaligram Sir, I think vested powers are such powers which we have inherently as per law e.g. recording evidence or taking evidence, making certified true copies, issuing summons for calling witnesses or records, because they are given to all officers as per the Sections of MVAT Act,,i.e.these are the certain powers of civil courts given to all authorities under sales tax whether STO or JC.....they need not be delegated..
.BUT ...When question is relating to some specific powers for acting under specific aspect of MVAT act such as enforcement visits, revision proceedings,,,then delegation is required....Means pl get this checked is my request....

ANSWER

Good Debate, Ramnani Sir,
i would partly agree with you. i would present my views on this topic:
The powers as regards issuing summons for calling witnesses or records, ie the powers of Civil Court are available to the Commissioner u/s 14 of the MVAT Act. These powers are also delegated to all the Officers in MSTD by the commissioner by notification issued u/s 10(6) to all the DC/AC/STO. 
As regards the Addl. CST and JC all the powers of the Commissioner under the Act are available to them, except those which are taken away by the Commissioner by notification u/s 10(4) and 10(5) respectively.
This is about the powers, which can be called as express functions of the Commissioner.
But there could be some other acts, which are not expressly stated in the Act. For example, verification of an application for registration, calling and examining the books of accounts of a dealer to be assessed. In the Act, we may not find these functions expressly stated, but these are necessary to do the assigned function and we get the power through some word or phrase in such sections.
Thus, in section 16,we get the power to verify application, documents for registration, Pre RC visit through the following phrase in sec. 16(3):
"If the prescribed authority, after scrutiny of the application and after such inquiry as it deems fit, is satisfied that the application for registration is in order........"
Thus, in section 16, it is not stated that the dealer should produce the POB/POR documents, but we get the powers indirectly through the above phrase because we are expected to ensure that the application is in order (i.e correct and complete).
Anyway thanks for stimulating the grey cells, Ramnani Sir.

All of us are awaiting your write ups on CST Act.
keep contributing...

Topic for Open discussion-2
This is the query posted by Shri Pritam Wartheji regarding liability to file e-704.

"As regard the vat audit report 704 . dealer mfg. T/F goods & purchases t/f & taxable goods and TO exceeds the limit as laid down in sec.61.But he can't file audit report taking stand that he is not liable to pay tax.plz. guide us."

 Friends read Section 61(1)(a) as under "61. Accounts to be audited in certain cases:-
(1) Every dealer liable to pay tax shall,-
(a) if his turnover of sales or, as the case may be, purchases [exceeds rupees sixty lakh] in any year, or As per this 'turnover of sales or purchases' whether 'taxable or not' is immaterial. Means every dealer who exceeds the turnover of Rs. 60 lakhs has to submit Audit Report in form 704

QUESTION

Sir,
A private ltd company sold his all assets to another company by transferring shares.
assets includes plant & Machinery, Electrifications, labvoratory Building and land development, as per balance sheet. as per mou agreement company has sold all the assets including goodwill. i am going to tax the all asssets ,dealer has submitted a judjment of tribunal Paramount Sinters (1220 of 1995) sir pl guide me in this matter if possible give me your cell no please. as 

ANSWER

 I feel that this could be a case of transfer of business, because, you have mentioned that the company has sold all its shares. In other words, it appears to be a case of "take over".
We have to remember that we are authorised to levy VAT on the "Sale of goods".
If you see the definition of "goods", you would find that shares are excluded from the definition. Thus, you cannot tax sale of shares.
Now other issues, which you need to examine are that whether the transferor has shown valuable consideration for each of the "goods". If the consideration then it would be difficult for you because you have mentioned that the transferred assets include Electrifications, labvoratory Building and land development.
Think on these lines. Unless the agreement and the relevant documents are seen, it would be hazardous to come to a conclusion by discussing on this forum.

QUESTION

As regard the vat audit report 704 . dealer mfg. T/F goods & purchases t/f & taxable goods and TO exceeds the limit as laid down in sec.61.But he can't file audit report taking stand that he is not liable to pay tax.plz. guide us.

ANSWER

The term, "Every dealer liable to pay tax" found in the opening part of section 61 means a dealer liable to register. Every dealer whose TO exceeds the prescribed limits is liable to pay tax and consequently for registration. Your dealer is already registered under the Act, therefore it does not matter as to whether he is actually liable to pay tax.
If his TO of sales or Purchases exceeds the limits, then he must file e-704. Section 61 does not speak about taxable goods anywhere.

QUESTION

कलम ६३(७) खालील सूचनेच्या (नमुना ६०४) नुसार लेख परीक्षणाची कार्यवाही सुरु केली. पण व्यापाऱ्याने दखल ब घेतल्याने त्याला नमुना ३०२ ची नोटीस बजावून कलम २३(५) नुसार पुढे कार्यवाही करताना त्याला कलम ३०(४) नुसार व्याज आकारणी करावी (जे त्याने स्वत्ताहून भरलेले नाही) कि कलम २९(३) नुसार शास्तीची आकारणी करावी (i .e . १००%)

ANSWER

माझ्या मते कलम ३०(४) च्या व्याजाची आकारणी होत नसते. त्या कलमामध्ये आपल्याला “ “Commissioner shall impose/levy” असे शब्द आढळत नाहीत तर त्यामध्ये ,” he shall be liable to pay”. याचाच स्वच्छ सरळ अर्थ की हे व्याज भरण्याचे दायित्व व्यापाऱ्यावर आहे. मित्रानो कलम ३० मधील सर्व व्याज भरण्याचे दायित्व व्यापार्याचेच आहे. या व्याजाची आकारणी आपण करत नसतो पण जर लागू असलेले व्याज व्यापाऱ्याने भरले नसल्यास व्याजाची परिगणना करून आपण त्याला भरण्याचे आदेश देतो. व्याज भरण्याचे आदेश देणे म्हणजे व्याजाची आकारणी करणे असा होत नाही. आपण जर delegation of powers ची अधिसूचना पाहिल्यास आपल्या असे लक्षात येईल की कलम ३० चे अधिकार कुणालाच प्रदान करण्यात आले नाहीत. कारण व्याजाची आकारणी होत नाही तर व्यापाऱ्याने व्याज स्वतःहून भरणे आवश्यक आहे व् न भरल्यास आपण आदेश पारित करून त्यास भरायला सांगतो.
याचाच अर्थ, आपल्या चर्चेतील व्यापाऱ्याची निर्धारणा करताना आपण व्याजाची आकारणी करणार नाही. तसेच, या प्रकरणातील व्यापाऱ्याने सुधारित विवरण पत्र दाखल केले नसल्याने कलम ३०(४) खालील व्याजाचा प्रश्नच येत नाही.
आता कलम २९(३) खालील शास्ती. ही शास्ती आकारण्या पूर्वी व्यापाऱ्यास सुनावणीची संधी देणे आवश्यक आहे. तसेच व्यापाऱ्याची “mens rea” दोषी भावना सिद्ध करणे आवश्यक आहे. कलम २९(३) खालील शास्ती संबंधी मार्गदर्शक तत्वे अंतर्गत परिपत्रक १ दिनांक ४-१-२०१४ मध्ये दिलेली आहेत. व्याजाची आकारणी १००% करावी किंवा कसे यासाठी परिपत्रक जरूर वाचा.

QUESTION

Sir ,what is 'Time barring'?
Pls explain

ANSWER

You would not find the word, "time bar" in either the Act or Rules. But this word is routinely used in taxation departments.
Simple meaning of this term is that the case is barred for action i.e. you cannot take any action in the matter. For every action under the Act, time limit is provided in the Act itself, which is also called as limitation period.
This concept of time bar could be applicable to passing of assessment order, rectification order, appeal order, application for registration and so on.......

QUESTION

I want opinions on Registration process. ....
1) Can TIN be granted to the Dealer without calling him to the Department? 
2) If yes what should be the modalities? 
3) Will it be risky for the Department?

ANSWER

Yes.change in application system ;alongwith Form 101.requisite doc shall be uploaded . n dealer should attend before registration authority within 10 working days.if doc in order n after due enquiry is correct then authority shall validate TINRC .Then dealer can use rc no.IF IT IS NOT IN ODER /FAILED TO ATTEND TINRC MAY AUTOMATIC CANCELLED OR AUTHORITY MAY REJECT APPLICATION, N CANCELLED TIN

 I feel that there must be interaction between the applicant and the registering authority before we register him. Registration Officer must interview the applicant. During the interview, the Officer can understand the antecedents and his business, his intentions. I know that this is not 100% fool proof method. Applicant can always fool the registering authority. But, just as having police chowky in the area deters a probable thief, just the knowledge of being interviewed can deter a person, who is on the brink. 
At present, the applicant attends before the registration officer for photo attestation. 
If we feel that the dealer should not be asked to attend, then we must visit him and interview him. But then it would require more manpower and may also result in delay in granting RC.

QUESTION

Whether interest under section 30(4) is payable on differential tax for wanting 'C' Forms in respect of period 2009-10? Is there any case law in this regard?

ANSWER

There could be two causes in this situation to impose penalty u/s 29(3): 
knowingly furnished inaccurate particulars of any transaction liable to tax or
knowingly mis-classified any transaction liable to tax.

I had said knowingly furnished particualrs of any transaction because of following reasons:
Dealer had initially sold goods interstate on the presumption that the buyer would give him CST declarations. But the declarations were not recieved. Still in the returns , the dealer had furnished the details as 2% transaction. Subsequently, he did not recieve the declarations even after a gap of more than 2 years, when the case was being audited. Even after pointing out the discrepancy in audit, the dealer did not accept the liability and file the revised return. Hence the case was taken up for assessment. Therefore, i think this case becomes fit for penalty u/s 29(3).
As regards, the "mis-classification" clause, as pointed out by Sunil Acharekar ji, i think that the mis classification could be for the purpose of rate of tax, as per schedule and may not be for non production of declarations. Still, ithink nothing wrong in trying either of these two causes. it is not concealment for sure.
Good to see Shri Sunil Acharekar ji come alive after a long gap.

QUESTION

Sir this is regarding Rule 10 and Rule 90
Rule 10 is regarding exhibition of VAT Certificates and Rule 90 is regarding fine to be levied for non exhibition of certificates.
Now i am at Dhule as Survey officer i find many Dealer not exhibiting the certificates.
now my question is who has the authority to enforce these rules under which sections?

ANSWER

 In evry law rules are made for operting powers and duties assigned by virtue of Sections of law .
Therefore these two rules are also for operation of some section in Law ( as right now while writing this comment I am not having Law book with me so I can not tell u exact section) .
Find the basic section of Law ,for operating these section these rules are made, then once u get the basic section ,go to notification section on our site In list of notification in year 2007 u will find notification regarding delegation of sections by Hon, CST who by virtue of Section ,10 delegated powers to all his subordinates right from additional cst to sto ,see there to which cader the basic sections of the rule quoted by u are delegated u will get perfect answer.

Actually, Rule 90 expressly does not provide that the Commissioner shall impose penalty.
The heading of the rule 90 is "Penalty", but in fact in rule 90, the word, "Fine" is used.
Rule 90 reads as follows:
"Penalty.-
A breach of any of these rules shall be punishable with fine which may extend to two thousand rupees and when the offence is a continuing one, with a daily fine not exceeding one hundred rupees during the continuance of the offence."

In a case before the Tribunal, DC LTU had imposed fine under Rule 90 for not amending RC to add additional POB. Tribunal has confirmed the fine in this case. [VAT SECOND APPEAL NO.20 of 2014 Date: 3.06.2014
M/s PANASONIC HOME APPLIANCE INDIA CO. LTD ]

In view of this decision, you would be entitled to impose fine for non compliance of any rules, but i think you should focus more on getting the URDs registered.

QUESTION

Topic calculations under old as well new rule 58 (1A),(1B)as under. Pl, guide.
PRIOR TO NOTIFICATION:Suppose the contract value is Rs.1000, sub-contract value is Rs. 200, land cost is Rs.200 then the abetment value will be Rs.1000 less 200 (sub contract value)=Rs.800. Deductions 30% on Rs.800 will be Rs 240. Hence, the works contract value for levy of tax will be 1000-240=760.
AFTER NOTIFICATION 58 (1B):
Rs.1000-(200+200) I.g. Both sub contracts and land cost=600 on which 30% will be Rs.180.Hence the works contract value will be Rs. 1000-180=820 which is subject matter of levy.
Sir, let's discuss actual method of determine liability with due regards.

ANSWER

You are absolutely right. After the recent amendment to rule 58, land cost deduction has to be made before applying the percentages provided in Table under Rule 58. But slight correction, this is because of an amendment to Note under Rule 58(1) Table and not because of Rule 58(1B). 
Anyway, but your observation is perfect.

QUESTION

Sirji, Dealer has submitted indemnity bond along with lorry receipt, bill copy and photocopy of counterfoil against original misplaced 'C' form, Can we allow while passing regular assessment order. If not please explain.

ANSWET

As per internal circular DT. 20/10/2008 an original part of declaration should be kept on record alongwith supporting proof.

mere indemnity bond is not enough, as has been rightly stated above.
Pl read CST (Registration & Turnover) Rule 12(2) and Rule 12(3), which gives a detailed procedure for lost declarations. These Rules are also available on our web site.

QUESTION

Todays my headache word is " RETROACTIVE ".Please guide on this word.

ANSWER

ay our govt issues a gr and you get DA from Jan 14- that is retroactive. Present events affecting past events. It is retrospective in essence. We need to check some advanced dictionary to check the subtle difference betn these words.

I got this thing on google search which may help you: While they sometimes may be used interchangeably, retrospective is primarily a looking quality whileretroactive is primarily doing.

You can have a retrospective show of an artist's work (looking back over her career). You would not have aretroactive show.

Similarly you can have a retrospectiveanalysis (reviewing past activities), but not a retroactive analysis.

When an action is intended to be effective based on an earlier period, the term retroactive is more often used (at least in the US). In effect, you are saying even though it happens now, we are treating it as if it happened then.

However, you may say we are taking action now and acting based on aretrospective computation. This is arguably different from a retroactiveevent. The former is treated as a present activity and the latter is treated as an activity that relates back to an earlier time (nunc pro tunc for the Latin/legal geeks)

QUESTION

एक PVT LTD कंपनी २०११ मध्ये चालू झाली. त्यांचा business हॉटेल चालवणे आहे. त्यांनी एक हॉटेल बांधायला चालू केले त्यासाठी त्यांनी मार्बेल्स OMS खरेदी केले त्यांनी २०११-१२ साठी c forms ची मागणी केली. त्यांना c form देता येतील का ?

माझ्या मते त्यांनी हॉटेल च्या बांधकामासाठी केलेला खर्च त्यांचा कॅपिटल Asset म्हणून धरला जाईल त्यामुळे त्यांनी जर हॉटेल च्या बांधकामासाठी OMS खरेदी केली असेल तर त्यांना c form मिळायला पाहिजेत Please Conform 

ANSWER

Correct view has been expressed above. Pl read the C Form carefully and read the purposes for which the goods purchased on C Form are required to be used. Does the purpose of your dealer fall in any of the categories mentioned on C Form

QUESTION

Sir, a dealer deals in tractors shows purchases @Rs.15 lacs on 29/10/12 and sales TO exceed on 02/01/13.
Frm which RC/TIN granted?

ANSWER

 Wef 02/ 01/ 13

i would just add a few words.
For granting VAT registration, TO of sales is only relevant. Purchases of oil seeds can be considered if oil seeds are purchased from URD/person and is liable to PT. 
PT on cotton has not been brought into force hence shall not be considered for computing limits also.
Vikas has not specified the date of application. RC would be effective from 2-1-2013 only if application for RC is within 30 days otherwise it would be effective from date of application.

QUESTION

If dealer shows same amt in GTO of sales & job work charges what is the meaning of that sir

ANSWER

It could mean that dealer is exclusively doing job work and is not selling any goods. In such a case, you may see his purchase side. If we see purchases, then we should ask him about the disposal of such purchases, because if he is using these purchases in "job work", then such transactions may amount to works contracts.

QUESTION

A partnership firm registered under MVAT ACT. Later partner A died. The another partner B, who was running the firm did not communicate the fact to the department and added another partner C to the business.
Now, after some years partner B also died. Partner C took over the business without giving share to the legal heirs of partner A.

Dealer is filing his returns regularly and paying the taxes also.

QUSTION

Sir,
Is IPS(Industrial promotion scm) & PSI same?
If not wht is difference?

ANSWER

You can say that in spirit, both are same. Both are meant to encourage Industrial growth in backward areas of the state. But the major difference is that under the PSI, the PSI Unit was either exempted from payment of tax(Exemption Mode) or it was asked to collect tax and pay after the fixed number of years (Deferral Mode).
Under the IPS, the Unit is required to pay the tax and he is given subsidy afterwards by the Industries Department.
Shri Ajit Patankar in our Group has good knowledge on the issue. i would expect him to share more on this.

QUESTION

What is the differencmmee between exemption &defferal regarding PSI scheme

ANSWER

 PSI Units: – The units enjoying benefits, whether by way of exemption or deferral, under the Package Scheme of Incentives may continue to enjoy the same. However they will now have to effect their purchases by paying full tax and claim refund of such tax paid on their purchases. (There are no concessional forms, such as BC Forms, etc., which were available earlier under the Bombay Sales Tax Act/Rules).
Resale of goods purchased from PSI Units: – As the units, enjoying exemption, do not charge tax on their sale, the subsequent dealer will not be in a position to take input tax credit. It is provided, therefore, that such subsequent dealer shall pay tax under the reduced value method; i.e., reducing the sale price by the amount of purchase price. Thus the tax is calculated on the amount of value addition only. Such a dealer, reselling goods purchased from PSI unit, shall make an additional declaration, as prescribed in Rule 77(2A), in his Tax Invoice or bill or cash memorandum as the case may be.
PSI Units: – The units enjoying benefits, whether by way of exemption or deferral, under the Package Scheme of Incentives may continue to enjoy the same. However they will now have to effect their purchases by paying full tax and claim refund of such tax paid on their purchases. (There are no concessional forms, such as BC Forms, etc., which were available earlier under the Bombay Sales Tax Act/Rules).
Resale of goods purchased from PSI Units: – As the units, enjoying exemption, do not charge tax on their sale, the subsequent dealer will not be in a position to take input tax credit. It is provided, therefore, that such subsequent dealer shall pay tax under the reduced value method; i.e., reducing the sale price by the amount of purchase price. Thus the tax is calculated on the amount of value addition only. Such a dealer, reselling goods purchased from PSI unit, shall make an additional declaration, as prescribed in Rule 77(2A), in his Tax Invoice or bill or cash memorandum as the case may be.
PSI Units: – The units enjoying benefits, whether by way of exemption or deferral, under the Package Scheme of Incentives may continue to enjoy the same. However they will now have to effect their purchases by paying full tax and claim refund of such tax paid on their purchases. (There are no concessional forms, such as BC Forms, etc., which were available earlier under the Bombay Sales Tax Act/Rules).
Resale of goods purchased from PSI Units: – As the units, enjoying exemption, do not charge tax on their sale, the subsequent dealer will not be in a position to take input tax credit. It is provided, therefore, that such subsequent dealer shall pay tax under the reduced value method; i.e., reducing the sale price by the amount of purchase price. Thus the tax is calculated on the amount of value addition only. Such a dealer, reselling goods purchased from PSI unit, shall make an additional declaration, as prescribed in Rule 77(2A), in his Tax Invoice or bill or cash memorandum as the case may be.

 In case of a dealer selling goods, originally manufactured by a dealer enjoying exemption under the Package Scheme of Incentive, and the tax is not recovered separately in his purchase invoice, the taxable turnover shall be determined by reducing from the sale price, the amount of purchase price paid in respect of such goods including the price of goods used in the packing if packing is charged separately. [Rule 57(2)]

 In case of Deferral Scheme the PSI unit is eligible to collect tax on sales and is allowed to defer the same i.e. it is not paid but is used for the development of the industry. It becomes payable after 12 years from the period of Eligibilty and that to in 6 instalments. Also there is monetary ceiling mentioned in the Eligibilty and Entitlement Certificate and the unit becomes a regular DEALER once the monetary or period is exhausted whichever is earlier. For further details there are many Trade Circulars on this subject.

QUESTION

Sir, what would you do in the following scenario for lease of cranes. 
A is a dealer with HQ in Maharashtra. All the cranes are imported in the name of HQ and capitalized here. He sends cranes to Surat on lease for 1 year. He does not have a branch in Surat and so the cranes were not branch transferred to Surat. After 1 year, he does not transport the cranes back to Maharashtra but lets them lie at Surat only till he gets another order. The next order is received from Delhi. He sends the cranes from Surat to Delhi. Now, he has paid lease on the first transaction of lease which started from Maharashtra. For second lease transaction, would Maharashtra be the appropriate state as the goods were not in Maharashtra and there was no foraml contract agreement entered into?

ANSWER

Sir, if you are speaking with reference to this case, the cranes in question are not ones requiring registration under motor vehicles act. Otherwise there would have been no question of assessing him. 
But if you have put this question in generalized terms, I would say that the provisions, exceptions and explanations under a particular state act that bestow some exemptions or concessions onto dealers or people at large, must also be applicable to CST transactions for which that particular state is an appropriate state for levy and collection of tax. This is because CST as a separate act had been devised merely to avoid the jurisdictional conflicts between the states wherein single transaction was being subjected to tax by more than two states. So it can be safely concluded that the concessions and exemptions available in a state act automatically become applicable to all the cst transactions where that particular state is an appropriate state. That is why no minimum rate of tax has been prescribed under CST act. Please tell me if I am wrong.

 I have two questions for you
What is your decision for the second lease?
Whether a definition under MVAT can be applied to CST provisions?

Sir, In the above referred case I assessed the dealer by considering the second transaction of lease as cst transactions with Maharashtra being the appropriate state. I gave following reasons, 
1. In lease transactions tax is levied on transfer of right to use and not on transfer of property/ownership of the goods. It was only because this factor of transfer of ownership was absent that lease transactions were not given the status of sale and legal fiction of deemed sale was invented to tax them. In the present case, since the goods were sent outside the state on lease terms at the time of first lease, the right to use these goods again returned to the owner of these goods as soon as the first lease period expired. And since the owner was in Maharashtra, any further transfer of right to use these goods would naturally have Maharashtra as source of such transfer of right to use. Hence it becomes a cst transaction within our own jurisdiction. 
2. Though the dealer had not brought back these cranes into Maharashtra, he did not have any branch in any of the other states. Now though physically the cranes were in Surat, they did not belong to any legal entity recognized in that state. The legal entity whom these cranes belonged to was located in Maharashtra. Hence Maharashtra is the appropriate state. Otherwise everybody would take his goods outside the geographysical jurisdiction of Maharashtra, would allow the goods to lie there and then would sell them and claim it to be outside our preview to tax such a sale. 
3. Since the lease transactions were taking place within the geographical confines of our country, they must be falling within one state or another. Since the dealer could not prove them to be falling within any other state, I considered them to be falling within Maharashtra as goods were imported and capitalized here. 
4. Since the contracts for these lease transactions were entered into by the HQ which is in Maharashtra, the transfer of right to use was always intended to be transferred from Maharashtra. It was only incidental that the cranes were physically not within the state. I argued that after every lease contract the cranes were supposed to be brought back to Maharashtra and it was the dealer's cost cutting policy that prevented these cranes from being transported back to their original place i.e. Maharashtra. Such incidental factors do not and should not affect the legal nature of these transactions. 
5. To avoid entry tax, the dealer had given a written undertaking to Andhra authorities that these cranes were not being brought into their state for the sale purpose and were meant to be returned back to their original place once the contract is over. I latched onto this and argued that the dealer should have brought these cranes back into Maharashtra and that he had not brought them back is violation of these states rules. Now if the dealer claims these lease transactions to have originated from any state other than Maharashtra, the entry tax provisions of these other states will stand violated. 
Considering all these, I taxed these transactions as CST lease transaction with Maharashtra being the appropriate state. 

Regarding your second question, I would again say that as far as applicability of state act provisions to cst transactions is concerned, the lower limit is defined by the state act and the upper limit is determined by CST act. 
Suppose a provision in the state act is more advantageous to the dealer than its corresponding cst provision, then the state act will, practically and not legally, prevail over cst act. That is why we now tax the cst transactions without c forms at local rate.
Otherwise, the provisions of state act will become applicable to cst transactions if not specifically barred by law. For example ITC of cst purchase is not allowed.
If we consider only definitions, then I would say no, not automatically. If state act definitions were intended to be applicable to cst transactions, there would not have been any need to amend definition of sale under cst act to include deemed sales such as lease.
I sound a little confused myself. Please correct me if am wrong.

QUESTION

Tell me different types of stay in detail?

ANSWER

There are three types of stay:
1) Ad Interim stay is granted when a dealer files an appeal and also applies for stay for recovery. This stay is in operation till the day when the appellant is called for hearing to fix part payment.
2) Interim Stay is granted after fixing of part payment when dealer is given to some period to make the payment. 
3) Final stay is given when the dealer makes the entire part payment.

QUESTION

Sir
Pls explain rule regarding Reduction in set off in case of Manufact.of taxfree goods.

ANSWER

The retention is equal to rate of tax on s,ale in course of intet_ sale I.e.presently it is 2% on goods used for manufacturing of tax free goods.
For remaining goods I.e. capital goods and retention on other goods is same as per rules applicable in normal cases I.e manuf of taxable goods.
Such cases r more at ,POB at Bhiwandi ,Ichalkaranji and Malegaon. . You may contact for more details with Officers of these locations.

QUESTION

Sir suppose dealer is works contractor having 60% receipts from pure labour and 40% from works contract, in this case whether rule 53 (6) b can be applied to deny the set off?

ANSWER

yes, Rule 53(6)(b) is attracted.

QUESTION

sir , Dealer who is works contractor & he purchases cement from out of state against C forms and use in construction whether this transction attracts 10 d penalty of CST act for the contravention of cst declarations

ANSWER

I hope you are talking about VAT period. i shall give you an exercise to find an answer to this question.
First red sec. 10d of CST Act and grounds mentioned therein for imposing penalty. i think if a dealer fails to make use of the said commodity for any such purpose without reasonable cause, this penalty is attracted.
Now read the purposes for which one can purchase on C form. Purposes are given on the C form itself.
Ascertain whether the purpose for which the dealer has used the goods are different from the purposes mentioned on C form.
DO this exercise and revert back.
We shall against discuss the issue.
This may sound a long winding approach, but here i am not giving you a readymade answer but i wish to give you a path...

Do You Know 1

As per Sec. 29(11) of MVAT Act, penalty order in respect of any period has to be passed within 8 years from the end of the year containing the said period.
Sec. 29(11) reads as follows:
"(11) No order levying penalty under the foregoing provisions of this section shall be passed in respect of any period after eight years from the end of the year containing the said period."
Assessment orders for 2005-06 must have already been passed. But, in case the dealer has applied for cancellation of ex-parte AO, then you have to watch out for this date i.e. 31-3-2014. OR, in case the penalty has been deferred in the AO, then also one has to watch out.

Do You Know-2
बांधकाम व्यावसायिक/विकासक(Developers) यांना २०१२-१३ चा ई-७०४ दिनांक ३१-३-२०१४ पर्यंत दाखल येईल. परंतु जर बांधकाम व्यावसायिक/विकासकाने २०१२-१३ साठी आपस मेळ योजनेचा फायदा घेतला असेल तर त्यास ही सवलत उपलब्ध नाही . (वाचा व्यापारी परिपत्रक क्र. 6T DATED 21-2-2014)

Do You Know-3
While assessing a works contractor for 2006-07 If he is discharging his liability u/r 58 (Actual Expense Method),then the deduction on account of labour and service charges for the execution of works is admissible:
• Upto 7-9-2006: Only if such labour and service done in relation to the goods is subsequent to the transfer of property in goods
• From 8-9-2006, this condition removed by GN dated 8-9-2006. 
Watch out for periods prior to 8-9-2006....

Do You Know-4
बांधकाम व्यावसायिक यांच्या निर्धारणा 
Assessment of Developers

आपल्याला माहित आहेच की बांधकाम व्यावसायिक दिनांक २०-६-२००६ पासून करास पात्र झाले आहेत. म्हणजेच या व्यापाऱ्यांच्या २००६-०७ पासूनच्या निर्धारणा कराव्या लागणार आहेत. या पूर्वी आपण नियम ५८ मध्ये सुधारणा झाल्याचे वाचले आहेच. तसेच बांधकाम व्यावसायिकांसाठी विवरणपत्र दाखल करण्यासाठी दिनांक ३०-४-२०१४ पर्यंत मुदत वाढ देखील परिपत्रकाअन्वये देण्यात आली आहे. 
वरील पार्श्वभूमीवर, वर्ष २००६-०७ ची निर्धारणा पूर्ण करण्यासाठी निर्धारणा अधिकाऱ्यास पुरेसा अवधी मिळावा व् व्यापाऱ्यास देखील नियमातील सुधारणेनुसार आपले कर दायित्व निश्चित करण्यासाठी वेळ मिळावा म्हणून अशा बांधकाम व्यावसायिकांची निर्धारणा करण्यासाठी दिनांक ३०-९-२०१५ पर्यंत मुदत वाढ देण्यात आली आहे. कलम २३ मध्ये राज्यपालांच्या दिनांक 3-३-२०१४ च्या अध्यादेशाने उप-कलम (१३) दाखल करण्यात आले आहे. 
अध्यादेशात असे नमूद करण्यात आले आहे की ज्या निर्धारणा दिनांक ३१-३-२०१४ रोजी कालबाह्य होत आहेत अशा निर्धारणा दिनांक ३०-९-२०१५ पर्यंत पूर्ण करता येतील. निर्धारणा कालमर्यादेत केलेली वाढ फक्त बांधकाम व्यावसायिकांच्या प्रकरणातच लागू आहे हे ध्यानात ठेवावे.
बांधकाम व्यावसायिकांच्या कोणत्या उप-कलमाखालील निर्धारणा दिनांक ३०-९-२०१५ पर्यंत पूर्ण करता येतील या विषयी आपल्याकडून ऐकण्यासाठी मी उत्सुक आहे.

QUESTION

One of the most important question to be looked while assessing the dealer under CST Act, 1956.
'A' is a dealer having head office at Mumbai and is registered under BST Act, 1959 with RC No. say 400000 S 001 and having CST Number say 400000 C 001 under CST Act, 1956.
The dealer has its Factory1 and Sales Office1 at Wada in Thane District and has separate RC number under BST Act, 1959 say 401399 S 002 and CST RC No. is same as 400000 C 001.

The dealer has third place of business 'Factory2 and Sales Office2' (separate unit of factory) in the State of Maharashtra at the same premises and is holding separate RC Number under BST Act, 1959 say 401399 S 003. However, the RC No. under CST Act of this third unit/factory is same (as that of H.O. and Factory1 and Sales office1).
From the above illustration, it is clear that,
-Over all the dealer has 3 POBs in the State of Maharashtra
-Each POB has their separate RC number under BST Act, 1959
-All the POB's has unique (Commonn) CST RC No.400000 C 001

- Each POB's are filing their separate returns under BST Act and CST Act with their respective Assessing Officers having their separate Divisional Jurisdiction and are being assessed separately by the respective assessing authorities up to 31.03.2006.

-After the advent of MVAT Act, 2002, the dealers who were already registered as on the date 31.03.2005 were not required to apply for registration

- the dealer has (wef 01.04.2006 ) been allotted unique/single TIN say 27000000000V under MVAT Act and 27000000000C under CST Act being unique TINs for all the 3 POB in the State of Maharashtra

-Now from 01.04.2006 the dealer is filing single return for all the 03 POBs using unique TIN 27000000000V and 27000000000C under respective acts.

The question arises when one is going to assess the dealer -

While assessing the dealer under CST Act for the period 2005-06, as to whether the dealer be assessed by passing single AO by clubbing his sales turnover of all 3 POBs or he can be assessed separately for each POB separately as per returns filed.

If assessed separately for each POB, 03 CST Assessment Orders will be passed by each assessing officer for the same period having different turnover of sales and purchases.

As per section 8A of the CST Act, 1956, in determining the turnover of sales of a dealer for the purposes of the CST Act, 1956, the aggregate of the sales prices is considered.

As per the Allahabad High Court Judgment in case of 'Ramesh Chandra Brick Kiln Owner vs Commissioner, Sales Tax, UP on 14 August, 1987, Section 18 of Act, 1948 is not an exception to Section 3 or to the broad scheme of the Act which enjoins upon the assessing authority to assess the aggregate turnover of a dealer of an assessment year. Section 18(1) and (2) simply state that if a business is discontinued or commences during the year then the dealer is enjoined to give a notice of discontinuation and commencement of the business in the circumstances, as stated under the two subsections of Section 18, it does not permit two separate assessments for the two businesses of one and the same dealer.

For the reasons, the order of the Tribunal affirming the single assessment made by the assessing authority in regard to the turnover of two kilns is upheld.

As far as the provision of MVAT Act, 2002 and rules there under concerns, 
what should be done properly while assessing the dealer under MVAT Act as well as CST Act, in above mentioned transition period.

Reply is anticipated with legal references. 

ANSWER

This is a very good question and not an easy one to answer:
My personal view is as under:
There cannot be a single answer to this question, because the answer may differ depending on the sub section of section 23 under which the dealer is proposed to be assessed.
i think that in certain sub sections, the assessment is qua return, while in some it is qua transaction and in others, it is qua period.
Bhausing Pawar, think on these lines and you would find the answer your self.

My views are as under. Pl.correct me if I am wrong.Let us look at the issue in hand in a simpler way. Since the dealer can not be having more than one R.Cs. under the CST Act and given the requirements of Section 8A of the CST Act, it would be appropriate to assess the dealer at one place preferably at the main POB where his R.C. Record is also available. Passing multiple orders under the CST Act for a single R.C. and for a single period would be bad in law, as it would contravene the provisions of the said section. MOREOVER, provisions of the MVAT Act do not speak about granting multiple R.C.s or single R.C. for a dealer carrying on business in the state and having more than one POBs. It is by virtue of an administrative decision ( Trade Circular 37 T of 2005), a single TIN (based on PAN) was granted wef 01-04-06 for a dealer in respect of his all POBs in the State. There is a reference of the word " Registration Certificate" and there is no reference of the word "TIN" in section 16 of the MVAT Act. So for the fiscal year 2005-06, the dealer may have more than one R.C.s which were granted to him in the BST era and which continued to remain valid during the said fiscal. Even though we switched over to self compliance system in the VAT era and the system of assessing each and every dealer for every period was done away with, still strictly speaking, the dealer could be separately assessed in respect of his each R.C. under the MVAT Act....

Good quality discussion....
In fact this is the aim of our Study Circle. Our aim is not to quench the thirst for knowledge, but the aim is to increase the thirst and hunger for knowledge... If we get answers for all our questions easily we would stop struggling, we would stop growing. We would have a laid back attitude.

Therefore i always believe, the "more you know" the "more you dont know", because we realise about our ignorance, when we increase our area of knowledge. 
This search for knowledge should go on till the end of our lives......

 Thanks to all of you for all the goods words. But i just consider myself a student of law...at the most i could be a better student....But collectively, all of you have tremendous talent. 
i always believe and i have expressed number of times that a child born today is more intelligent than the child born yesterday... 
With all of you, the future of our Department is truly bright..        @ SHALIGRAM SIR