Service Tax amendments by Union Budget 2015

The Finance Bill, 2015 presented by the Finance Minister, Mr. Arun Jaitely on 28th February, 2015 has brought with it a whole new set of changes in the indirect taxes. The basic purview taken by the government behind rationalising the transformations is to bring the current taxing provisions in line with the proposed plan of Goods and Service Tax. The Finance Minister while addressing the august gathering highlighted that the backdrop idea of adverting the taxing aspects is not only the GST but the rising concern towards the environment.

1. Changes applicable w.e.f. 1st March, 2015

1. CENVAT Credit can be taken within 1year:
   Time limit for availment of CENVAT Credit extended to 1 year from the date of invoice.
2. Registration for single premises shall be granted within two days of filing the application.
3. Records can be maintained in Electronic form:
   In order to encourage digitalization, Government has allowed assesses to maintain records in the electronic form subject to authentication by him with the use of digital signature.

2. Changes applicable w.e.f. 1st April, 2015

1. Exemption given in respect of transportation of food stuff will be limited to the food grains only due to which food stuff other than food grains will also become costlier.
2. Relief in relation to precondition, pre-cooling ripening labeling of fruits and vegetables is allowed by which end cost of fruit and vegetable would get reduced.
3. Now watching of movies will become cheaper:
   Now watching of movies will become cheaper because Service provided by way of exhibition of movie by the exhibitor (theatre owner) to the distributor or an association of persons consisting of such exhibitor as one of its members is being exempted.
4. Benefit given to senior citizen:
   Exemption is granted in respect of life insurance services provided by way of Varishtha Pension Bima Yojna so that people can spend their old age life in a better manner.
5. Exemption for ambulance services:
   Government has given specific exemption for transporting the patients through ambulances so that financial cost on patient and family of patient can be minimized to the some extent.
6. Uniform abatement for transport by rail, road and vessel:
   A uniform abatement is now being prescribed for transport by rail, road and vessel thereby service Tax shall be payable on 30% of the value of such service subject to a uniform condition of non-availment of CENVAT Credit on inputs, capital goods and input services.
   The impact of the above amendment is that cost of transportation through road and railway is increased whereas transportation cost through vessel is get reduced.
7. Air Transport will hit the pocket of High Class flights:
   The government has reduced the abatement on business class flights. Now, travel in the business class will become costlier as the abatement has been reduced to 40% from 60%.
8. Construction of Government Schools and Buildings would become taxable.
9. Construction pertaining to port/airport would also become costlier due to withdrawal of exemption given in this respect.

3. Changes to be effective from the date Finance Bill, 2015 receives the assent of the president

1. Revised recovery and penalty provisions
   Penalty provisions made more stringent with maximum penalty equal to 100 % of Service Tax. However, in certain cases the benefit of reduced penalty will be allowed to the assessee. Also, exemption from levy of penalty on defaulters has been removed.
2. Reimbursement made taxable under Service Tax
   The government has clarified that the value of reimbursements of all expenses incurred during provision of a taxable service shall be subject to Service tax levy.

4. Changes to be effective from the date to be notified after the Finance Bill, 2015 receives the assent of the president

1. Rate of Service Tax increased from 12.36% to 14%
   Finance Minister has proposed to revise the rate of Service Tax from 12.36% (inclusive of Education Cesses) to 14% (subsuming Education Cesses)
2. Entry to amusement park /entertainment events will become costlier:
   Entry to amusement park/ entertainment events which was earlier exempted under negative list of services now brought under the ambit of service tax. However, exemption is still applicable to entertainment events in case the entry charge does not exceed Rs. 500.
3. Job Work for production of alcoholic liquor is now taxable:
   Job Work for production of alcoholic liquor is now become taxable. Same has been brought under tax net by which liquor prices are expected to rise.

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Budget Highlights - 2015

-Corporate Tax Rate reduced to 25% for over next four years

-Exemptions For Individual Tax Players To Continue

-Yoga to be included as Charitable Purpose

-To Enact New Law For Black Money

-Concealment of income will attract 10 yrs of rigorous imprisonment

-Stringent penalties and jail for Black Money holders and evaders

-Benami property transaction bill to tackle black money transaction in real estate soon

-Foreign Exchange Management Act To Allow For Seizure Of Foreign Assets

-FEMA Act to be amended to incorporate Black Money provisions: Finance Minister

-To Allow Tax Pass-through For Alternative Investment Funds

-To Tighten Reporting Of Cash Transactions

-To Have Benami Transaction Prohibition Bill For Domestic Black Money

-Quoting PAN a must for all purchases above One Lakh

-100% deduction allowed for all contributions in Swachh Bharat Abhiyan [except contribution in CSR]

-Proposes to rationalise capital gains tax regime for real estate investment trusts

-To defer GAAR by 2 years

-Tax pass through to be allowed in alternative investment funds to boost small firms, startups

-Propose To Rationalise Capital Gains Regime For REITs/InvITs

-TO reduce Custom Duty on 22 items

-Rental Income from REITS to have pass through facility

-Income Tax On Royalty Fees For Technical Reduced To 10%

-To abolish Wealth Tax;

-2% Additional surcharge on super rich.

-Reduced taxes on Technical Services to 10% from 25%

-Tax reduce for foot wear above 1k per pair

-Service Tax increased to 14%

-80D Health insurance 15000 to 25000
  For senior citizens 30000

-80DDB increased to 80000

-Wealth Tax abolished

-Tax on royalty income decrease from 25% to 10%

-Transport Allowance exemption increased to 1600 pm

-Domestic Transfer Pricing limit increased from 5crores to 20 crores

To Download the copy of Memorandum to Finance Bill Click Here

You May Also Like:

Budget Implication on Personal Taxes

Service Tax amendments by Union Budget 2015

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How An Act Of Kindness Taught Me The Lesson – “Just Do It”

How An Act Of Kindness Taught Me The Lesson – “Just Do It”

This article has been inspired from an incidence from my personal life that happened yesterday night (24^th February 2015).  I had gone out for dinner with a friend who also happens to be my gym buddy.  Although, both of us are quite regular going to our gym, we don’t give up on our bad food habits and a lot of time end up eating high calorie food from restaurants.  This is the reason why both of us keep making our wives angry.  Anyways, this article is not about our food habits but about something much more enriching and enlightening.

So, this friend of mine whose name is Utkarsh took me out to dinner last night.  Both of us went to a very famous dhaba/restaurant and after having our dinner were driving back home.  At one traffic signal, I somehow started discussing with him about my and my wife’s desire to start some charity relating to women sanitation.  Both of us for some time have been thinking of working on improving women sanitation for those who reside on the roadside pavements.  Since they don’t have proper houses to stay and suffer from women related hygiene issues, both of us have been thinking of tying up with some NGO.

So, I was mentioning to Utkarsh about our desire to do something on those lines.  When I finished talking to him, he started to speak about one initiative that he and his wife have been doing for some years and after hearing that initiative, I was speechless and at the same time mesmerized.  He told me that at one particular traffic signal near IIT Delhi, whenever he stops his car he is suddenly treated like a celebrity and that’s because all the children at that signal come and stick to his car like honeybees.  On his statement of being a celebrity my natural reaction was to ask him – “Bhai what do you do that makes you a celebrity there”?  And then he told me the following:

Every once a week or in a fortnight, he and his wife stop their car on that signal and ask all the children to reach a roadside dhaba/restaurant that is 50 steps away from the signal.  The dhaba owner knows Utkarsh very well and when the children reach his place he knows Utkarsh is somewhere around.  When the children (generally 10-15 in nos.) reach there, Utkarsh asks everyone what would they like to eat and then without thinking of cost simply orders the food.  The children are told to be completely free in their requests that ranges from chicken, dal, roti, rice, paneer etc.  Whatever they want, they get it.  To ensure other children or their elders do not snatch the food, he asks the dhaba owner to make exactly the same no. of packets as the no. of children and each packer will have each of the item they had requested for.  This means that each packet will typically have one portion each of dal, roti, rice and chicken/paneer.  In order to ensure easy digestion of the food, he would also hand them a coke can/fruit juice.  And then one packet is handed to each of them to enjoy and relish with the drink.

Yesterday night also was one of those nights when I was fortunate to watch this incidence.  By the time he narrated me his awesome initiative, we had reached the same signal but since the car was mine, we weren’t sure if the children would recognize Utkarsh sitting inside the car.  But as they say, “daane daane pe likha hota hai khane wale ka naam” three young girls, aged around 7-8 years saw him and identified by waving their hands.  One of them made a gesture as if she was hungry and requested by making appropriate facial expression if Utkarsh could make the necessary arrangements.  He lowered the windowpane and asked how many of them were there with her.  She said three.  He asked her to reach the dhaba along with her friends and then did exactly the same what he had narrated to me a while back when were returning from the restaurant.  By the time we reached she was already there with 5 more children. 

The photo that I have inserted in the blog is the actual photo that I clicked yesterday night around 10.30PM with those young little girls feeling so happy holding Fanta cans in their hands and ensuring they don’t leave any drop unlicked.

This incidence obviously made me speechless but also taught me one lesson that ‘Action Speak Louder Than Words”.  I realized we had been thinking of doing something good for the society for a long time and had been talking about it with our friends, but then never did anything concrete about it.  And, on the other hand there’s this guy who had been doing such great acts of humanity for a long time and had never ever mentioned before.  This made me feel and look weak.  I had been suggesting people and students about how procrastination destroys a human being, but then on this aspect I was myself procrastinating and not doing anything other than just talking.

What this incidence also taught me was the belief that Nike uses as its tagline - ‘Just Do It’.  In our lives we aspire for some great things, things that we want to do badly but in the hustle bustle of the daily routine we tend to forget so many of them.  Some day, just sit down, relax for sometime and think if you ever wanted to do something in your life that you have perhaps forgotten.  Try and remember those aspirations or goals of your life that could have been as small as flying a kite, visiting your old aunt or uncle’s place whom you have not visited for ages, drawing a picture of your parents or friends, or simply playing ludo with your family.  You may also have had grand plans for yourself like buying a big house, buying a luxury car, getting a job with your dream company, visiting your favourite vacation destination, starting a charity foundation, learn how to start writing your own blog or one day even write a book. 

We all have aspirations and dreams we truly desire to achieve.  But if we don’t do anything concrete to achieve them, you would end up being the way it happened with me - not doing anything on my desire to help women sanitation.

To avoid getting into a trap, what I suggest to each one of you is write down your dreams and goals you want to achieve.  Unless you write them down on a piece of paper, you will not be able to remember them and eventually, forget them.  So here are some tips on how you should write your goals and then make a routine and create a path to achieving them:

1.             Write 100 goals of your life

Make a list of 100 goals that you would want to accomplish in your lifetime.  These can be anything that you aspire to do and something that you feel, if accomplished would make your life worthwhile. 

I have started preparing my list 100 goals and till now have reached 54 goals.  I still need to add 46 more.  At some point of time in future, I might share with all of you my goals J

2.             Make a Goals Diary

In order to write your goals nicely, I suggest you take a separate diary and then on each page write down one goal.  To make it look real, try and put some pictures and write some sentences about it so that when you read it again and again, your subconscious mind starts to make it happen for you.  The diary can be a scrapbook - something like what Ranbeer Kapoor had in the movie ‘Ye Jawani Hai Deewani’ or it can be a simple diary with enough pages to put pictures and illustrations.

3.             Have at least one goal that pushes you to your limits

Amongst the list of 100 goals you should have at least one goal (you obviously can have more) that if achieved would make you feel like a ‘rockstar’.  That goal should energize you, should be a good enough reason for you to wake you up every morning and if achieved, would completely turn around your life.  It can be something like buying a luxury car or writing a book or doing scuba diving or becoming CEO of a company etc. 

This goal would keep you on your toes, would keep you extremely focused and let you take the path that few people take in their lives.  This is the goal that would make your life worth it.

4.             Have a definite time period attached to your goals

There’s no point writing your dreams if you don’t know by when to achieve them.  In order to make your subconscious mind work in tandem with your desires, it is important to have a definite time period by which you would achieve your goals.  I suggest that against each goal write down the time and the date by which you would achieve that goal.  For example – instead of writing that I will loose 10 kgs weight, write down that I shall weigh 75 kgs by 31^st March 2015.  By doing this you are sending highly focused signals to your brain

5.             Re-read your goals

Make it a habit to read your goals at least twice, once in the morning when you wake up and once at the night before you go to sleep.  As per some proven scientific techniques, if you, before sleeping read something that feeds your mind an aspiration and whilst you are about to sleep, you start to believe that your aspiration is getting fulfilled, the subconscious mind takes it very seriously and makes it happen for you without fail.  This is because when you are sleeping, your subconscious mind is not getting any negative signals and consequently, the feeling of you having achieved your dream gets fixed in your subconscious mind. 

I have tried this myself and it surely works. 

6.             Believe in yourself completely

Whatever be the situation, you have to believe in yourself and feed your mind that “YOU WILL DO IT”.  Trust me, if you develop this habit then sooner or later you would surely be the “Winner”.

I hope this article helps you take some informed choices.  I wish you all green lights in your life…

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Authored by Nimish Goel (www.nimishgoel.com), a qualified chartered accountant who’s passion is to coach young chartered accountants and aspiring students achieve the best in their life.  Nimish used to work with EY and PwC in India and has also worked with KPMG in Europe.  He now runs his own consulting company and runs a blog www.nimishgoel.com.  He can be reached for any queries and issues on his blog.  

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Railway Budget 2015-16: Key Highlights:

Railway Budget 2015-16: Key Highlights:

• No increase in passenger fares.
• Outlay for passenger amenities increased by 67%.
• We will introduce train sets saving 20% of journey time, similar to bullet trains in design, and that can run on existing tracks.
• SMS alert to be introduced for train timings.
• E-catering introduced in 108 trains, can order on IRCTC website.
• To expand water vending machines on more stations.
• On-board entertainment facility could be extended on Shatabdi trains.
• Mobile charging stations will be introduced general class coaches.
• More general class coaches will be added to select trains for benefit of the common man.
• Railways plans to spend over Rs 8 lakh crore over five years
• Pension funds, multi-lateral banks have evinced interest in Railways
• Proposed the best operating ratio in nine years, of 88.5 per cent for 2015-16
• Railways to go through transformation in five years; to increase track capacity by 10 per cent to 1.38 lakh km
• To improve cleanliness & design of bed linen
• All India 24x7 grievances helpline 138 to start soon
• 7,000 more toilets to be replaced by Bio-Toilets, New toilets at 650 stations, more vaccum toilets
• Passenger travelling unreserved can procure a ticket within 5 minutes
• Mobile application to address complaints of people is also being developed
• Introduction of integrated ticketing will be done
• Hand-held devices for ticket checkers for moving towards paperless ticketing
• Centrally managed railway display network in over 2000 stations in next 2 years
• Railways will play a big role in socio-economic development of the country
• Railways carry a big burden of expectations
• Investments in railways will have multiplier effect
• Railways facilities have not improved significantly over last few years
• The cycle of under-investment should end
• Railways has to regain in share in freight traffic
• Railways aims to deliver a sustainable improvement in customer experience and make rail a safer means of travel
• Objective is to make Railways self-sustainable
• Rail-cum-road ticket to be extended to many stations

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Centre for Development of Advanced Computing Pune (CDAC Pune) - Vacancy for CA/CS/ICWA

Name of the post - Senior Finance Officer

Minimum Qualification & experience 

1. CA with 4 years experience or
2. Two years Full Time MBA in finance / CS / ICWA or equivalent relevant professional qualification with 7 years relevant experience.

Name of the post - Finance Officer

Minimum Qualification & experience 

1. CA or
2. Two years Full Time MBA in finance / CS / ICWA or equivalent relevant professional qualification with 3 years relevant experience with 3 years relevant experience.

Last date to apply online: 05/03/2015

For More Details and to Apply online Click Here.

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Exposure Draft: Classification of Liabilities (Proposed amendments to IAS 1) - (20-02-2015)

Exposure Draft published by the International Accounting Standards Board (IASB) for comment only. Comments on the Exposure Draft need to be received by May 10, 2015.

The International Accounting Standards Board (IASB) has published this Exposure Draft of proposed amendments to IAS 1 Presentation of Financial Statements to address:

(a)  replacing ‘discretion’ in paragraph 73 of the Standard with ‘right’ to align it with the requirements of paragraph 69(d) of the Standard;

(b)  making it explicit in paragraphs 69(d) and 73 of the Standard that only rights in place at the reporting date should affect this classification of a liability; and 

(c)  deleting ‘unconditional’ from paragraph 69(d) of the Standard so that ‘an unconditional right’ is replaced by ‘a right’. 

Invitation to comment 

ASB invites comments on the Exposure Draft from the public. The downloadable version of the draft is available at: 

http://www.ifrs.org/Current-Projects/IASB-Projects/IAS-1-classification-liabilities/Exposure-Draft-February-2015/Documents/ED-Classification-of-Liabilities-Amdments-to-IAS-1-February-2015.pdf 

Comments would be most helpful if they indicate the specific paragraph or group of paragraphs to which they relate, contain a clear rationale and, where applicable, provide a suggestion for alternative wording. 

How to comment 

Comments should be submitted using one of the following methods: 

1.   Electronically: Click on the below mentioned option to submit a comment letter or Visit at the following link (Preferred method): 

http://www.icai.org/comments/asb/ 

2.  Email: Comments can be sent to: commentsasb@icai.in 

3.  Postal: 
Secretary, Accounting Standards Board,
The Institute of Chartered Accountants of India,
ICAI Bhawan, Post Box No. 7100,
Indraprastha Marg,
New Delhi 110 002

Further clarifications on this exposure draft may be sought by e-mail to achin.poddar@icai.in

Comments are invited on the proposals in this Exposure Draft, particularly on the questions set out in the Exposure Draft

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Jharkhand State Livelihood Promotion Society (JSLPS) - vacancy for CA/ICWA

Job Profile :  District Finance Manager

No. of Vacancies - 04

Qualification & experience - 2 year MBA (finance)/Post Graduate Degree in Commerce from recognized University/Instituteor CA (inter)/ ICWAI (inter).You should have at least 5 years of post-qualification relevant experience, only, of working on financial management, budgeting, developing financial system in Government/semi government agency, banking institutions, reputed financial firms or large non-government organizations.

Job Profile : Accounts Officer

No. of Vacancies - 04

Qualification & experience - 2 year MBA (finance)/Post Graduate Degree in Commerce from recognized University/Instituteor CA (inter)/ ICWAI (inter). You should have at least 3 years of post-qualification relevant experience, only, of working on Accounts& Audit System, budgeting, developing Accounting system in Government/semi government agency, banking institutions, reputed financial firms or large non-government organizations.

Last date to receive application form: 28/02/2015

For More Details Click Here.

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Simplifying Delhi Value Added Tax – Legal & Procedural Relaxations Expected

Simplifying Delhi Value Added Tax – Legal & Procedural Relaxations Expected

By CA Ankit Gulgulia (Jain)

ankitgulgulia@gmail.com

Delhi Value added tax simplification has been one of major agendas of all state governments. It has been largely felt and outlined that procedural relaxation is a must to ensure smooth trade in the city or outside. At the same time it is well understood that blanket relaxations would have the other side of the coin also and can lead to undesirable situation for the government including unethical revenue leakages.

Considering the upcoming Delhi budget, few of the relaxations on both legal and procedural ends can be as under:-

A) Procedural Changes

1) 2A-2B Mismatch Assessment

Mismatch assessments based on 2A-2B filed by purchasers and sellers have been a major obstacle for traders in Delhi. One needs to keep a check literally on the all vendors he deals with and even enquire on his tax filing status and tax paid by his vendor. The situation is clearly undesirable as even the bonafide purchasers are being made to suffer on non-compliances by selling dealers.

Even the law backs this undesirable situation as the input tax credit can be disallowed to purchasing dealer if the selling dealer has not paid tax and not filed his return correctly allocating buyer’s TIN in his returns.

A simple solution to this can be linking 2A-2B on invoice based mechanism. Once individual invoices can be generated and linked directly from dvat system this hassle can be neutralized effectively. Though making such infrastructure can be challenging.

2) T-2 Relaxation

Currently Form T-2 is required to be filed for all the goods entering in Delhi except in few cases including GTO being less than 1 Crore. It is noteworthy that recently even Haryana government abolished its similar transit form VAT D-3 in light of its cumbersomeness. T-2 can be either abolished and state tracking can be maintained at border level or the limits can be raised to say a GTO of 5 Crores or more.

3) Hard Copy filing of DVAT-56

Currently in Delhi, if you have filed a return without using digital signature then one must deposit the hard filed copy of dvat-56 within prescribed time to avoid the late fees. This hard filing can be eliminated to move to paperless concept on similar track of ACES (Service tax and Central Excise return filing).

4) WCT Certificates hard copy submission

In case of contractee WCT returns, normally the wct certificate issued to contractors are also seeked at the hard copy. This can be dispensed away.

5) Comprehensive DVAT System – Need of the day

It is crucial the dvat systems evolves into a system which is transparent and user friendly at the same time. Department has done commendable efforts to improve its systems. As a part of further evolving process, the system can be made to :-

• Generate TIN based linked invoices
• Automate Returns (subject to manual adjustments, if any) based on generated and punched invoices and credit notes
• Email Notifications for mismatches based on 2A-2B.
• Maintenance of all statutory registers on the portal itself. This would allow real time access to the information to both the dealer / officials, which in turn can reduce departmental interventions in routine course of dealer.

6) Registration

The registration processes have been simplified to a great extent by the department. Further, the process can be streamlined further on following aspects:-

• Randomization of inspection officials.
• Closure of RC Issuance or notice for cancellation within 48 Hours (for example)
• To ensure more smooth registration, the TIN shall be provided along with RC only. The time gap between TIN number issuance and RC issuances may result in several transactions in the intervening period which have its effects.

7) Amendment in Registration

This can be further simplified. Currently, the complete DP-1 / DVAT-07 has to be filed for amendment. As a process, the amendments can be identified in different categories viz, change in name, constitution, contact details, items etc. If only that amended portion is seeked and filed online, it can radically reduce the time frame and hassles.

8) Ward Change – Based on Address Change

In my view, this requires thought process at the strategical level. In an ideal sense, where the address has changed and ward jurisdiction shall change accordingly or not cannot be a blanket decision. In normal cases and subject to outgoing jurisdictional VATO confirmation it can be allowed straight away.

B) Legal Changes

9) Very Heavy Late Return filing fees

It is noteworthy that per day of delay in filing a return attracts a late fees of Rs 500/- day in Delhi. If you are registered in both VAT / CST then late fees would be Rs 1,000/- per day (VAT & CST Return are separate returns). This quantum of per day late fees can be re-considered in light of many dealers including small retailers filing very low tax returns or even nil returns.

10) Works Contract Composition Scheme

· Composition scheme currently is sub-distributed based on category of works contracts and modalities of operation choosed by the dealer into three parts and two sub-schemes.

· Further, a specific clause or clarification can be issued on applicability of scheme in case of non monetary consideration agreements of works contract like in case of area sharing agreements.

11) Flat rate of tax i.e. 12.5% in works contract can be revisited

In Delhi, if the material is sold pursuant to the works contract then the rate of tax shall be always 12.5% unless in case of printing contracts or declared goods. Such a provision can be relooked and the items shall be made taxable as per their listing in the schedules to DVAT Act to bring parity between tax cost of normal sales and deemed sales of works contract.

Similar provisions of taxing the items as per schedule rates even if transferred pursuant to works contract exists in states like Haryana & Uttar Pradesh as well.

12) Rule 3 of DVAT Rules

As per proviso to Rule 3(2),

“PROVIDED that where amount of charges towards labour, services and other like charges are not ascertainable from the books of accounts of the dealer, the amount of such charges shall be calculated at the percentages specified in the following table”

The above provision instead of being a second resort to department (where the books of accounts cannot be utilized for computation of labour and service charges) can be made optional at dealer’s end. This can reduce litigation largely and provide certainty to works contract valuation.

13) Limitation period for filing objection against mismatch assessments

The Section 74 of the Act provides a deadline of 2 months from the date of service of notice and further condonation of delay of 2 months. In cases of mismatch assessments being newly implemented and required immense external documentation since demand / objection of purchasing dealer will depend on documents / returns / invoices and challans of selling dealer is always a time consuming effort.

In view of the above, the mismatch assessments objections can be separately dealt with in the Act, may be vide a proviso insertion to this effect.

14) Input tax credit hindrance

The biggest problem the dealers are facing today is undoubtedly the 2A-2B mismatches. As per section 9, the input tax credit can be denied to the purchasing dealer if:-

“ to the dealers or class of dealers unless the tax paid by the purchasing dealer has actually been deposited by the selling dealer with the Government or has been lawfully adjusted against output tax liability and correctly reflected in the return filed for the respective tax period”

This provision requires a revisit in all means. Where the purchasing dealer in all bonafide intention has paid his tax to the selling dealer and selling dealer has then not discharged his obligations of tax payments and return filing, the purchasing dealer shall be not be denied the input tax credit. The tax shall be recovered from the selling dealer only.

Traders cannot be expected to obtain return copies of each and every vendor they transact with.

15) Composition scheme for retailers

The threshold limit of composition dealer can be revisited and if required further increased. A suitable rate and threshold turnover for eligibility would prompt more tax compliance from small retail dealers much to the benefit of economics and sentiments.

16) Audits & Search – Seizure related matters

For audits and search / seizure / survey matters, it is essential to note that these matters are to play a balancing roles between avoiding harassment to tax paying dealers and making tax evading dealers to comply the law of the state. Though no blanket provisions can be introduced to this effect, audits can be exempted to a suitable threshold gross turnover and it is can made once in three / five years for certain class of dealers.

Before parting…

The Delhi VAT department has evolved in very significant manner over a period of time. Further evolving is always the desired route for both state government and Delhi dealers. The above can be few areas among many where the processes and rules require a revisit and the interest in large of dealers and revenue both needs a equivalent safeguard.

I intend to receive constructive comments and views of esteemed readership.

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About the Author:

CA Ankit Gulgulia (Jain)

Author is Practicing Chartered Accountant in New Delhi/NCR and his area of interest includes Indirect Taxes, Corporate Laws and Transfer Pricing. He can be reached at ankitgulgulia@gmail.com.

DISCLAIMER: This article is provided purely for your information only and you should check other information sources before taking any action based on any of the content in this article. Neither the authors nor website hosting the article make any warranty as to the quality or currency of the information contained in any of the site's articles.

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