Amendments in the various act as per Maharashtra Budget 2016-17

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TRADE CIRCULAR

Sub: Amendments to various Acts, rides and notifications issued there under.

Ref: 1)Mah. Act No. XV of 2016 Dt 26th Apr. 2016

2) Notfn. No. VAT 1515/CR 158/Taxn-1 Dt 30t’1 Dec. 2015

3) Notfn. No. VAT/ADM-2016/1B/ADM-8 Dt 24th Feb. 2016 (3 notifications) issued by the Commissioner.

4) Notfn. No. VAT 1516/CR 53/Taxn-1 Dt 1St Apr. 2016.

5) Notfn. No. VAT. 1516/CR-52/Taxn-1 Dt 22nd Apr.2016,

6) Notfn_. No. VAT/ADM-2016/ 1B/ADM.-8 Dt 28th Apr. 2016 issued by the Commissioner.

7) Notfn. No. CST-1516/CR 45/Taxn-1 Dt. 22nd Apr. 2016

8) Notfu. No. VAT-1516/CR 62/Taxn-1 Dt 29th Apr,2016

9) Notfn. No. VAT 1516/CR-64/Taxn-1 Dt. 29th April 2016

 

No.VAT/AMD-2016/1A/ 1/ Adm-8

—————————–                                                                                                      Mumbai Dt: 07/05/2016

Trade Cir. 14 T of 2016

To give effect to the Budget proposals for the year 2016-17, a Bill (Legislative Assembly Bill No.XVIII of 2016) to amend the various Acts, administered by the Sales Tax Department has been passed by the Legislature and has received assent of the Governor on 26th April 2016. The Act (Maharashtra Act No. XV of 2016) is published in the Maharashtra Government Gazette dated 26th April 2016.

The Acts, which are amended, are as follows:

  1. The Maharashtra Purchase Tax on Sugarcane Act, 1962(SCPT Act.);
  2. The Maharashtra State Tax on Professions, Trades, Callings and Employments Act, 1975 (PT Act);
  3. Maharashtra Tax on the Entry of Goods into Local Area Act, 2002 (Entry Tax Act):
  4. The Maharashtra Value Added Tax Act, 2002 (MVAT Act).

The date of applicability for each of the amendment has been mentioned, in the respective pars explaining the amendment.

The salient features of the amendments are explained below:-

A. Amendment to Maharashtra Purchase Tax on Sugarcane Act, 1962 (SCPT Act):-

Exemption from payment of SCPT for 2015-16 (Amendment of section 12B):

Earlier provision: Section 12B empowers the State Government to exempt the payment of Sugarcane Purchase Tax (SCPT), in certain specified circumstances, by issuing a notification in the Official Gazette.

Amended provision: Section 12B has been amended. New sub-section (2) provides for exemption from payment of SCPT, on sugarcane purchased during the year 2015-16, by a sugar factory, which exports sugar to the extent of the Mill-wise Indicative Export Quota(MIEQ) during the year 2015-16. The MIEQ for the sugar factories has been laid down by the Department of Food and Public Distribution, Govt. of India.

“Year” as defined in sec. 2(1) means year starting from 1st October to 30th September. Therefore, the new provision regarding exemption is applicable for the period starting from 1st October 2015 to 30th September 2016. In other words, the exemption from payment of SCPT shall be available, if sugar to the extent of the MIEQ is exported by a sugar factory during the year 2015-16.

B. Amendments to the Maharashtra. State Tax on Professions, Trades, Callings and Employments Act, 1975 (PT Act):

1. Amnesty to un-enrolled persons [Amendment to sec. 3 of the PT Act]:

Earlier provisions: Section 3(2) of the PT Act provides that liability to pay tax of an un-enrolled person shall be restricted to 8 years, preceding the year, in which he has applied for enrolment. Now a new sub-section (3) has been added in section 3 w.e.f. 1st April 2016, which provides that an un-enrolled person shall not be liable to pay for any periods prior to 1st April 2013, if

a) he makes an application for enrolment from 1st April 2016 to 30th September 2016, or

b) his application for enrolment is pending on lit April 2016.

A detailed Trade Circular, containing guidelines and procedure, separately issued.

2. Exemption from PT: (Amendment to Sec. 27A):

Earlier provision: Members of the Armed Forces are exempt from the payment of PT.

Amended provision: Now, armed members of the Central Reserve Police Force and armed members of the Border Security Force are also exempt from the payment of PT.

This amendment is effective from 1st April 2016. The benefit of this exemption is available to the salary for the month of April 2016 and onwards, irrespective of the date on which the salary is disbursed.

C. Amendments to Maharashtra Tax on the Entry of Goods into Local Area Act, 2002 ( Entry Tax Act):

Applicability of provisions of the MVAT Act etc regarding e-returns, e-payment etc. to Entry Tax Act 🙁 Insertion of sec, 6A):

Provisions under the Maharashtra Value Added Tax Act and Rules for e-returns, e-payment, e-application, etc. are now made applicable tnutatis rnutandis to provisions of the Entry Tax Act. A new section 6A has been inserted w.e.f. 26th April 2016 i.e. date of Amendment Act.

D. Amendments to the Maharashtra Value Added Tax Act, 2002 (MVAT Act)

1) Exemption to sizing and warping of yarn:

Section 8 of the MVAT Act empowers the State Government to exempt fully or partially from payment of tax by certain classes of dealers by issuing a general or special order in the Official Gazette. A new sub-section (3D) has been inserted in section 8 to empower the State Government to issue an order providing for full or partial exemption from payment of tax to the dealers transferring property in goods involved in the sizing and warping of yarn.

Accordingly, the State Government has issued a notification No VAT-1516/ CR 62 /Taxi.. 1 Dated 29th April 2016 providing for full exemption from payment of tax on transfer of property in goods involved in the sizing and warping of yarn w.e.f. 1st April 2016. The dealers claiming exemption under this notification shall be eligible to claim set-off in the following manner:

  •  Set-off on the capital goods, used exclusively for sizing and warping of yarn, can be claimed as per rule 52.
  •  Set-off on goods, consumed or used in the sizing and warping of yarn and consumables and packing materials used in the said process shall be admissible after reducing it by 2% of the purchase price.

2) Amendments related to registration

  1. Amendment of Section 16 & related rules:

Trade is aware that registration procedure has been automated. A dealer applying for registration is required to upload an electronic application on the department’s website. Necessary documents are also required to be scanned and uploaded on the department’s website. In other words, the applicant dealer is not required to attend before the registration officer. The objective behind this procedure is to avoid the visits of the applicant dealer to the Sales Tax Office and to grant registration in minimum possible time.

In view of the above modified procedure, certain amendments have been made to Section 16 and related rules which are explained as follows:

a) Rejection of registration application [Substitution of proviso to sec. 16 (3)]:

Earlier provision: Proviso to sec. 16(3) provided that if an application for registration is incomplete, or if the information or prescribed documents etc. are not furnished then application can be rejected after giving a reasonable opportunity of being heard to the applicant.

Amended provision: Proviso to sec. 16(3) has been substituted, in view of the automation process. As per the amended provision, an application for registration may be rejected if:

  1. the application is incomplete, or
  2. required documents are not uploaded on the department’s website, or
  3. documents are inconsistent with the information in the application, or
  4. documents are not legible, or
  5. prescribed conditions are not fulfilled.

The registration officer would pass rejection order in the above contingencies. To speed up the registration process, application shall be rejected without giving an opportunity of being heard. However, the applicant shall be permitted to comply with the deficiencies communicated to him within 30 days from the date of intimation of rejection order.

If the applicant dealer complies with the deficiencies within the said period then original application shall stand restored. The application would be restored in this manner only once within the said period of 30 days. If a dealer complies with the deficiencies after the said period of 30 days, then the earlier rejected application shall not be restored and the application shall be treated as a fresh application. Benefit of restoration of earlier application shall not be available and the date of such fresh application shall be considered for deciding the date of effect of registration, as per rule 9.

This amendment shall come into force on the date, notified by the State Government.

b) Cancellation of registration, obtained raudain Second _proviso to _sec. 16(6) substituted):

Earlier provision:  The person applying for registration is expected to upload an application as well as the documents on the department’s website. He is riot required to attend the sales tax office for verification of documents and application. The objective behind this procedure is to create an environment of trust amongst the dealers and also to speed up the registration process. Certain contingencies i.e. discontinuance of business, disposal or transfer of business, turnover falling below limits of registration have been provided in sec.16(6J. Second proviso of sec. 16(6) provides for cancellation of registration if a voluntarily registered dealer fails to commence business within 6 months from the date of registration.

New provision: Second proviso to see. 16{6) has now been substituted w.e.f. 26th April 2016 to provide for an additional contingency for cancellation of registration.

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