Summary of DVAT Amendment Act 2016 GSTPANACEA.COM CONSULTANCY PVT. LTD.

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1 Summary of DVAT Amendment Act 2016 GSTPANACEA.COM CONSULTANCY PVT. LTD.

2 DELHI VAT AMENDMENT DECODDED 1) ADVANCE TAX ON IMPORTED GOODS TO DELHI... 2 Notification + Rates... 2 Exemption & Reduction in Rates... 2 Exemption & reduction in Rates in General... 2 Exemption on Basis of Application ) Returns with Digital Signature Certificate (DSC) ) Electronic Communication of Sales information ) Reduction in Penalty ) Special Courts & public Prosecutor ) Report on Investigation of Offences ) No Composition of Second & Susequent Offence ) AMNESTY Scheme... 4 To get regular updates on WhatsApp send your details on or info@gstpanacea.com 1

3 DELHI VAT AMENDMENT DECODED Lt. Governor Shri Naseeb Jung gave assent to The Delhi Value Added Tax (Amendment) Act 2016 which has been notified by government vide Notification No. F.14/LA-2016/cons2law/77-86 dated The effective date of implementation would soon be notified. Significantly, this is the first legislation to be notified as a law since the AAP government took charge in February This act has only 8 amendments but can become game changer for Delhi. We have tried to decode it for your convenience. 1) ADVANCE TAX ON IMPORTED GOODS TO DELHI Introduction of new sub-section 11 in section 3. The amendment introduces a mechanism to bring imported goods entering Delhi after customs clearance into the advance tax net and prevent tax evasion. The VAT department will now prepare and notify the percentage at which the advance tax will be levied. Officials justify its introduction on the grounds that it would help keep track of imported goods coming into the city; and their movement and sale would be recorded with the VAT department as well NOTIFICATION + RATES The Government may by notification specify the goods on which a person shall pay tax in advance at the rates notified by the Government but not exceeding the rates applicable on such goods under this Act, when he imports such goods into the National Capital Territory (NCT) of Delhi from a place outside India, subject to such conditions as may be specified in the notification. The aforesaid payment of tax in advance shall be counted towards the final tax liability of the taxable person. EXEMPTION & REDUCTION IN RATES EXEMPTION & REDUCTION IN RATES IN GENERAL Government may by notification exempt any person or class of persons from payment of tax in advance or reduce the rate of payment of tax in advance subject to such conditions as may be notified. To get regular updates on WhatsApp send your details on or info@gstpanacea.com 2

4 EXEMPTION ON BASIS OF APPLICATION If on an application made by a person the Commissioner or an officer authorized by him, after verifying all aspects of the case, arrives at a decision that such person should be exempted from payment of tax in advance or that the rate of payment of tax in advance should be reduce for such person, he may do so and impose such terms and conditions on such person as he may deem fit. 2) RETURNS WITH DIGITAL SIGNATURE CERTIFICATE (DSC) Introduction of new sub-section 2 in section 29. The Commissioner may by notification in the official gazette, require any dealer or class of dealers to file the returns only through electronic mode appending digital signatures or any other electronic identification process and with effect from such date as may be specified therein. 3) ELECTRONIC COMMUNICATION OF SALES INFORMATION Introduction of new section 50A. This section introduces e-communication & monitoring measures. The Government may by notification in the official gazette require any dealer or class of dealers to install such physical compliance devices or software, as may be considered necessary for instantaneous communication of the information of sale invoices to the Commissioner. The cost of equipment and installation of the device and software shall be borne by the dealer. 4) REDUCTION IN PENALTY Reduction in Penalty amount U/s 86(10) from Rs. 10,000/- to Rs. 1,000/-. Any person who furnishes a false, misleading or deceptive return or failure to include any matter or thing without which the return is false, misleading or deceptive the the penalty shall be Tax Deficiency or Rs. 10,000/- 1,000/-whichever is greater. In other words minimum penalty amount is now Rs. 1,000/- To get regular updates on WhatsApp send your details on or info@gstpanacea.com 3

5 5) SPECIAL COURTS & PUBLIC PROSECUTOR Government introduced new section 91A which has provisions for a special court with the concurrence of the Chief Justice of Delhi high court. The government would appoint a public prosecutor to such a court. An additional public prosecutor might also be appointed. 6) REPORT ON INVESTIGATION OF OFFENCES Every officer or person so authorized shall, upon investigation of the offence, submit a report to the Commissioner with the recommendations for sanctioning prosecution or otherwise and the Commissioner, shall, then take a decision as to whether prosecution is essentially required in the matter. 7) NO COMPOSITION OF SECOND & SUSEQUENT OFFENCE Proviso has been introduced in Section 93(1) that the composition of offence shall not apply in case of second and subsequent offence of the same nature. 8) AMNESTY SCHEME Amendment has been made in Section 107 which throws open the option of introducing an amnesty scheme in the future. This is in keeping with the AAP government's budget promise of focusing on better tax compliance as a way to bolster collections. DISCLAIMER: This document is for information only. All care has been taken for laws but in case something has been missed request our readers to update us. This should not be taken as any advice from our concern. We shall not be liable for any loss if occurred for laws stated in this document. Thanks & Regards Team GSTpanacea.com info@gstpanancea.com To get regular updates on WhatsApp send your details on or info@gstpanacea.com 4