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Separate paging is given to this Part in order that it may be filed as a separate compilation.
LOK SABHA
————
The following Bills were introduced in Lok Sabha on 27th March, 2017:—
BILL NO. 56 OF 2017
A Bill further to amend the Indian Institutes of Information Technology Act, 2014.
BE it enacted by Parliament in the Sixty-eighth Year of the Republic of India as
follows:—
1. (1) This Act may be called the Indian Institutes of Information Technology Short title and
(Amendment) Act, 2017. commencement.
(2) It shall come into force on such date as the Central Government may, by notification
in the Official Gazette, appoint.
30 of 2014. 2. In section 24 of the Indian Institutes of Information Technology Act, 2014 Amendment
(hereinafter referred as the principal Act), in clause (d) of sub-section (2), for the words of section 24.
"Indian Institutes of Information Technology", the words "Indian Institute of Technology"
shall be substituted.
3. In section 32 of the principal Act, in clause (a), for the words "Assistant Professor", Amendment
the words "Assistant Professor or above" shall be substituted. of section 32.2 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Amendment 4. In the Schedule to the principal Act, after serial number 4 and the entries relating
of Schedule. thereto, the following serial number and entries shall be inserted, namely:—
Sl. Name of the Name of the Location Name of the
No. State existing Institute under
Institute this Act
"5. Andhra Indian Institute Kurnool Indian Institute
Pradesh of Information of Information
Technology, Design Technology, Design
and Manufacturing and Manufacturing,
Kurnool.".SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 3
STATEMENT OF OBJECTS AND REASONS
The Indian Institutes of Information Technology Act, 2014 was enacted, inter alia, to
declare certain Institutes of Technology to be institutions of national importance.
2. The Government of India set up a new Indian Institute of Information Technology,
Design and Manufacturing at Kurnool in the State of Andhra Pradesh to give effect to its
obligation under the Andhra Pradesh Reorganisation Act, 2014. Now it has been decided
to amend the Indian Institutes of Information Technology Act, 2014 so as to bring the said
Institute within the scope of that Act and to declare it as an institution of national
importance.
3. The Indian Institutes of Information Technology (Amendment) Bill, 2017, inter alia,
seeks to declare the Indian Institute of Information Technology, Design and Manufacturing
at Kurnool as an institution of national importance and include it in the Schedule to the said
Act.
4. The Bill seeks to achieve the above objectives.
NEW DELHI; PRAKASH JAVADEKAR.
The 21st March, 2017.4 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
FINANCIAL MEMORANDUM
Clause 4 of the Indian Institutes of Information Technology (Amendment) Bill, 2017,
inter alia, seeks to amend the Schedule to the Indian Institutes of Information Technology
Act, 2014 so as to include the Indian Institute of Information Technology, Design and
Manufacturing at Kurnool within the scope to the said Act and declare it as an institution of
national importance.
2. The Indian Institute of Information Technology, Design and Manufacturing at Kurnool
is already functioning and a budgetary allocation of Rs. 3.10 crore had been made for the
financial year 2015-2016 and Rs. 20.00 crore for the financial year 2016-2017 under the Plan
fund. The expenditure for establishment of the said Institute shall be met from the budgetary
provisions of the Department of Higher Education under the Ministry of Human Resource
Development.
3. The Bill does not involve any other expenditure of recurring or non-recurring nature
from the Consolidated Fund of India.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 5
BILL NO. 57 OF 2016
A Bill to make a provision for levy and collection of tax on intra-State supply of goods or
services or both by the Central Government and the matters connected therewith or
incidental thereto.
BE it enacted by Parliament in the Sixty-eighth Year of the Republic of India as follows:—
CHAPTER I
PRELIMINARY
1. (1) This Act may be called the Central Goods and Services Tax Act, 2017. Short title,
extent and
(2) It extends to the whole of India except the State of Jammu and Kashmir.
commencement.
(3) It shall come into force on such date as the Central Government may, by notification
in the Official Gazette, appoint:6 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Provided that different dates may be appointed for different provisions of this Act and
any reference in any such provision to the commencement of this Act shall be construed as
a reference to the coming into force of that provision.
Definitions. 2. In this Act, unless the context otherwise requires,––
(1) “actionable claim” shall have the same meaning as assigned to it in section 3
of the Transfer of Property Act, 1882; 4 of 1882.
(2) “address of delivery” means the address of the recipient of goods or services
or both indicated on the tax invoice issued by a registered person for delivery of such
goods or services or both;
(3) “address on record” means the address of the recipient as available in the
records of the supplier;
(4) “adjudicating authority” means any authority, appointed or authorised to pass
any order or decision under this Act, but does not include the Central Board of Excise
and Customs, the Revisional Authority, the Authority for Advance Ruling, the Appellate
Authority for Advance Ruling, the Appellate Authority and the Appellate Tribunal;
(5) “agent” means a person, including a factor, broker, commission agent, arhatia,
del credere agent, an auctioneer or any other mercantile agent, by whatever name
called, who carries on the business of supply or receipt of goods or services or both on
behalf of another;
(6) “aggregate turnover” means the aggregate value of all taxable supplies
(excluding the value of inward supplies on which tax is payable by a person on reverse
charge basis), exempt supplies, exports of goods or services or both and inter-State
supplies of persons having the same Permanent Account Number, to be computed on all
India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess;
(7) “agriculturist” means an individual or a Hindu Undivided Family who
undertakes cultivation of land—
(a) by own labour, or
(b) by the labour of family, or
(c) by servants on wages payable in cash or kind or by hired labour under
personal supervision or the personal supervision of any member of the family;
(8) “Appellate Authority” means an authority appointed or authorised to hear
appeals as referred to in section 107;
(9) “Appellate Tribunal” means the Goods and Services Tax Appellate Tribunal
constituted under section 109;
(10) “appointed day” means the date on which the provisions of this Act shall
come into force;
(11) “assessment” means determination of tax liability under this Act and includes
self-assessment, re-assessment, provisional assessment, summary assessment and
best judgment assessment;
(12) “associated enterprises” shall have the same meaning as assigned to it in
section 92A of the Income-tax Act, 1961; 43 of 1961.
(13) “audit” means the examination of records, returns and other documents
maintained or furnished by the registered person under this Act or the rules made
thereunder or under any other law for the time being in force to verify the correctness
of turnover declared, taxes paid, refund claimed and input tax credit availed, and to
assess his compliance with the provisions of this Act or the rules made thereunder;
(14) “authorised bank” shall mean a bank or a branch of a bank authorised by
the Government to collect the tax or any other amount payable under this Act;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 7
(15) “authorised representative” means the representative as referred to in
section 116;
(16) “Board” means the Central Board of Excise and Customs constituted under
54 of 1963. the Central Boards of Revenue Act, 1963;
(17) “business” includes––
(a) any trade, commerce, manufacture, profession, vocation, adventure,
wager or any other similar activity, whether or not it is for a pecuniary benefit;
(b) any activity or transaction in connection with or incidental or ancillary
to sub-clause (a);
(c) any activity or transaction in the nature of sub-clause (a), whether or
not there is volume, frequency, continuity or regularity of such transaction;
(d) supply or acquisition of goods including capital goods and services in
connection with commencement or closure of business;
(e) provision by a club, association, society, or any such body (for a
subscription or any other consideration) of the facilities or benefits to its members;
(f) admission, for a consideration, of persons to any premises;
(g) services supplied by a person as the holder of an office which has been
accepted by him in the course or furtherance of his trade, profession or vocation;
(h) services provided by a race club by way of totalisator or a licence to
book maker in such club ; and
(i) any activity or transaction undertaken by the Central Government, a
State Government or any local authority in which they are engaged as public
authorities;
(18) “business vertical” means a distinguishable component of an enterprise
that is engaged in the supply of individual goods or services or a group of related
goods or services which is subject to risks and returns that are different from those of
the other business verticals.
Explanation.––For the purposes of this clause, factors that should be considered
in determining whether goods or services are related include––
(a) the nature of the goods or services;
(b) the nature of the production processes;
(c) the type or class of customers for the goods or services;
(d) the methods used to distribute the goods or supply of services; and
(e) the nature of regulatory environment (wherever applicable), including
banking, insurance, or public utilities;
(19) “capital goods” means goods, the value of which is capitalised in the books
of account of the person claiming the input tax credit and which are used or intended
to be used in the course or furtherance of business;
(20) “casual taxable person” means a person who occasionally undertakes
transactions involving supply of goods or services or both in the course or furtherance
of business, whether as principal, agent or in any other capacity, in a State or a Union
territory where he has no fixed place of business;
(21) “central tax” means the central goods and services tax levied under
section 9;8 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(22) “cess” shall have the same meaning as assigned to it in the Goods and
Services Tax (Compensation to States) Act;
(23) “chartered accountant” means a chartered accountant as defined in
clause (b) of sub-section (1) of section 2 of the Chartered Accountants Act, 1949; 38 of 1949.
(24) “Commissioner” means the Commissioner of central tax and includes
the Principal Commissioner of central tax appointed under section 3 and the
Commissioner of integrated tax appointed under the Integrated Goods and Services
Tax Act;
(25) “Commissioner in the Board” means the Commissioner referred to in
section 168;
(26) “common portal” means the common goods and services tax electronic
portal referred to in section 146;
(27) “common working days” in respect of a State or Union territory shall
mean such days in succession which are not declared as gazetted holidays by the
Central Government or the concerned State or Union territory Government;
(28) “company secretary” means a company secretary as defined in
clause (c) of sub-section (1) of section 2 of the Company Secretaries Act, 1980; 56 of 1980.
(29) “competent authority” means such authority as may be notified by the
Government;
(30) “composite supply” means a supply made by a taxable person to a
recipient consisting of two or more taxable supplies of goods or services or both,
or any combination thereof, which are naturally bundled and supplied in conjunction
with each other in the ordinary course of business, one of which is a principal
supply;
Illustration.— Where goods are packed and transported with insurance, the
supply of goods, packing materials, transport and insurance is a composite supply
and supply of goods is a principal supply;
(31) “consideration” in relation to the supply of goods or services or both
includes––
(a) any payment made or to be made, whether in money or otherwise, in
respect of, in response to, or for the inducement of, the supply of goods or
services or both, whether by the recipient or by any other person but shall
not include any subsidy given by the Central Government or a State
Government;
(b) the monetary value of any act or forbearance, in respect of, in
response to, or for the inducement of, the supply of goods or services or
both, whether by the recipient or by any other person but shall not include
any subsidy given by the Central Government or a State Government:
Provided that a deposit given in respect of the supply of goods or
services or both shall not be considered as payment made for such supply
unless the supplier applies such deposit as consideration for the said supply;
(32) “continuous supply of goods” means a supply of goods which is
provided, or agreed to be provided, continuously or on recurrent basis, under a
contract, whether or not by means of a wire, cable, pipeline or other conduit, and
for which the supplier invoices the recipient on a regular or periodic basis and
includes supply of such goods as the Government may, subject to such conditions,
as it may, by notification, specify;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 9
(33) “continuous supply of services” means a supply of services which is
provided, or agreed to be provided, continuously or on recurrent basis, under a contract,
for a period exceeding three months with periodic payment obligations and includes
supply of such services as the Government may, subject to such conditions, as it may,
by notification, specify;
(34) “conveyance” includes a vessel, an aircraft and a vehicle;
(35) “cost accountant” means a cost accountant as defined in clause (c) of
23 of 1959. sub-section (1) of section 2 of the Cost and Works Accountants Act, 1959;
(36) “Council” means the Goods and Services Tax Council established under
article 279A of the Constitution;
(37) “credit note” means a document issued by a registered person under
sub-section (1) of section 34;
(38) “debit note” means a document issued by a registered person under
sub-section (3) of section 34;
(39) “deemed exports” means such supplies of goods as may be notified under
section 147;
(40) “designated authority” means such authority as may be notified by the
Board;
(41) “document” includes written or printed record of any sort and electronic
21 of 2000. record as defined in clause (t) of section 2 of the Information Technology Act, 2000;
(42) “drawback” in relation to any goods manufactured in India and exported,
means the rebate of duty, tax or cess chargeable on any imported inputs or on any
domestic inputs or input services used in the manufacture of such goods;
(43) “electronic cash ledger” means the electronic cash ledger referred to in
sub-section (1) of section 49;
(44) “electronic commerce” means the supply of goods or services or both,
including digital products over digital or electronic network;
(45) “electronic commerce operator” means any person who owns, operates or
manages digital or electronic facility or platform for electronic commerce;
(46) “electronic credit ledger” means the electronic credit ledger referred to in
sub-section (2) of section 49;
(47) “exempt supply” means supply of any goods or services or both which
attracts nil rate of tax or which may be wholly exempt from tax under section 11, or
under section 6 of the Integrated Goods and Services Tax Act, and includes
non-taxable supply;
(48) “existing law” means any law, notification, order, rule or regulation relating
to levy and collection of duty or tax on goods or services or both passed or made
before the commencement of this Act by Parliament or any Authority or person having
the power to make such law, notification, order, rule or regulation;
(49) “family” means,––
(i) the spouse and children of the person, and
(ii) the parents, grand-parents, brothers and sisters of the person if they
are wholly or mainly dependent on the said person;
(50) “fixed establishment” means a place (other than the registered place of
business) which is characterised by a sufficient degree of permanence and suitable
structure in terms of human and technical resources to supply services, or to receive
and use services for its own needs;10 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(51) “Fund” means the Consumer Welfare Fund established under section 57;
(52) “goods” means every kind of movable property other than money and
securities but includes actionable claim, growing crops, grass and things attached to
or forming part of the land which are agreed to be severed before supply or under a
contract of supply;
(53) “Government” means the Central Government;
(54) “Goods and Services Tax (Compensation to States) Act” means the Goods
and Services Tax (Compensation to States) Act, 2017;
(55) “goods and services tax practitioner” means any person who has been
approved under section 48 to act as such practitioner;
(56) “India” means the territory of India as referred to in article 1 of the
Constitution, its territorial waters, seabed and sub-soil underlying such waters,
continental shelf, exclusive economic zone or any other maritime zone as referred to in
the Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime
Zones Act, 1976, and the air space above its territory and territorial waters; 80 of 1976.
(57) “Integrated Goods and Services Tax Act” means the Integrated Goods and
Services Tax Act, 2017;
(58) “integrated tax” means the integrated goods and services tax levied under
the Integrated Goods and Services Tax Act;
(59) “input” means any goods other than capital goods used or intended to be
used by a supplier in the course or furtherance of business;
(60) “input service” means any service used or intended to be used by a supplier
in the course or furtherance of business;
(61) “Input Service Distributor” means an office of the supplier of goods or
services or both which receives tax invoices issued under section 31 towards the
receipt of input services and issues a prescribed document for the purposes of
distributing the credit of central tax, State tax, integrated tax or Union territory tax paid
on the said services to a supplier of taxable goods or services or both having the same
Permanent Account Number as that of the said office;
(62) “input tax” in relation to a registered person, means the central tax, State tax,
integrated tax or Union territory tax charged on any supply of goods or services or
both made to him and includes—
(a) the integrated goods and services tax charged on import of goods;
(b) the tax payable under the provisions of sub-sections (3) and (4) of
section 9;
(c) the tax payable under the provisions of sub-sections (3) and (4) of
section 5 of the Integrated Goods and Services Tax Act;
(d) the tax payable under the provisions of sub-sections (3) and (4) of
section 9 of the respective State Goods and Services Tax Act; or
(e) the tax payable under the provisions of sub-sections (3) and (4) of
section 7 of the Union Territory Goods and Services Tax Act,
but does not include the tax paid under the composition levy;
(63) “input tax credit” means the credit of input tax;
(64) “intra-State supply of goods” shall have the same meaning as assigned to
it in section 8 of the Integrated Goods and Services Tax Act;
(65) “intra-State supply of services” shall have the same meaning as assigned to
it in section 8 of the Integrated Goods and Services Tax Act;
(66) “invoice” or “tax invoice” means the tax invoice referred to in section 31;
(67) “inward supply” in relation to a person, shall mean receipt of goods or
services or both whether by purchase, acquisition or any other means with or without
consideration;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 11
(68) “job work” means any treatment or process undertaken by a person on
goods belonging to another registered person and the expression “job worker” shall
be construed accordingly;
(69) “local authority” means––
(a) a “Panchayat” as defined in clause (d) of article 243 of the Constitution;
(b) a “Municipality” as defined in clause (e) of article 243P of
the Constitution;
(c) a Municipal Committee, a Zilla Parishad, a District Board, and any other
authority legally entitled to, or entrusted by the Central Government or any State
Government with the control or management of a municipal or local fund;
(d) a Cantonment Board as defined in section 3 of the Cantonments
41 of 2006. Act, 2006;
(e) a Regional Council or a District Council constituted under the Sixth
Schedule to the Constitution;
(f) a Development Board constituted under article 371 of the Constitution;
or
(g) a Regional Council constituted under article 371A of the Constitution;
(70) “location of the recipient of services” means,—
(a) where a supply is received at a place of business for which the
registration has been obtained, the location of such place of business;
(b) where a supply is received at a place other than the place of business
for which registration has been obtained (a fixed establishment elsewhere), the
location of such fixed establishment;
(c) where a supply is received at more than one establishment, whether the
place of business or fixed establishment, the location of the establishment most
directly concerned with the receipt of the supply; and
(d) in absence of such places, the location of the usual place of residence
of the recipient;
(71) “location of the supplier of services” means,—
(a) where a supply is made from a place of business for which the
registration has been obtained, the location of such place of business;
(b) where a supply is made from a place other than the place of business
for which registration has been obtained (a fixed establishment elsewhere), the
location of such fixed establishment;
(c) where a supply is made from more than one establishment, whether the
place of business or fixed establishment, the location of the establishment most
directly concerned with the provisions of the supply; and
(d) in absence of such places, the location of the usual place of residence
of the supplier;
(72) “manufacture” means processing of raw material or inputs in any manner
that results in emergence of a new product having a distinct name, character and use
and the term “manufacturer” shall be construed accordingly;
(73) “market value” shall mean the full amount which a recipient of a supply is
required to pay in order to obtain the goods or services or both of like kind and quality
at or about the same time and at the same commercial level where the recipient and the
supplier are not related;
(74) “mixed supply” means two or more individual supplies of goods or services,
or any combination thereof, made in conjunction with each other by a taxable person
for a single price where such supply does not constitute a composite supply.
Illustration.—A supply of a package consisting of canned foods, sweets,
chocolates, cakes, dry fruits, aerated drinks and fruit juices when supplied for a single12 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
price is a mixed supply. Each of these items can be supplied separately and is not
dependent on any other. It shall not be a mixed supply if these items are supplied
separately;
(75) “money” means the Indian legal tender or any foreign currency, cheque,
promissory note, bill of exchange, letter of credit, draft, pay order, traveller cheque,
money order, postal or electronic remittance or any other instrument recognised by the
Reserve Bank of India when used as a consideration to settle an obligation or exchange
with Indian legal tender of another denomination but shall not include any currency
that is held for its numismatic value;
(76) “motor vehicle” shall have the same meaning as assigned to it in clause (28)
of section 2 of the Motor Vehicles Act, 1988; 59 of 1988.
(77) “non-resident taxable person” means any person who occasionally
undertakes transactions involving supply of goods or services or both, whether as
principal or agent or in any other capacity, but who has no fixed place of business or
residence in India;
(78) “non-taxable supply” means a supply of goods or services or both which is
not leviable to tax under this Act or under the Integrated Goods and Services Tax Act;
(79) “non-taxable territory” means the territory which is outside the taxable
territory;
(80) “notification” means a notification published in the Official Gazette and the
expressions “notify” and “notified” shall be construed accordingly;
(81) “other territory” includes territories other than those comprising in a State
and those referred to in sub-clauses (a) to (e) of clause (114) ;
(82) “output tax” in relation to a taxable person, means the tax chargeable under
this Act on taxable supply of goods or services or both made by him or by his agent
but excludes tax payable by him on reverse charge basis;
(83) “outward supply” in relation to a taxable person, means supply of goods or
services or both, whether by sale, transfer, barter, exchange, licence, rental, lease or
disposal or any other mode, made or agreed to be made by such person in the course
or furtherance of business;
(84) “person” includes—
(a) an individual;
(b) a Hindu Undivided Family;
(c) a company;
(d) a firm;
(e) a Limited Liability Partnership;
(f) an association of persons or a body of individuals, whether incorporated
or not, in India or outside India;
(g) any corporation established by or under any Central Act, State Act or
Provincial Act or a Government company as defined in clause (45) of section 2 of
the Companies Act, 2013; 18 of 2013.
(h) any body corporate incorporated by or under the laws of a country
outside India;
(i) a co-operative society registered under any law relating to co-operative
societies;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 13
(j) a local authority;
(k) Central Government or a State Government;
21 of 1860. (l) society as defined under the Societies Registration Act, 1860;
(m) trust; and
(n) every artificial juridical person, not falling within any of the above;
(85) “place of business” includes––
(a) a place from where the business is ordinarily carried on, and includes a
warehouse, a godown or any other place where a taxable person stores his
goods, supplies or receives goods or services or both; or
(b) a place where a taxable person maintains his books of account; or
(c) a place where a taxable person is engaged in business through an
agent, by whatever name called;
(86) “place of supply” means the place of supply as referred to in Chapter V of
the Integrated Goods and Services Tax Act;
(87) “prescribed” means prescribed by rules made under this Act on the
recommendations of the Council;
(88) “principal” means a person on whose behalf an agent carries on the business
of supply or receipt of goods or services or both;
(89) “principal place of business” means the place of business specified as the
principal place of business in the certificate of registration;
(90) “principal supply” means the supply of goods or services which constitutes
the predominant element of a composite supply and to which any other supply forming
part of that composite supply is ancillary;
(91) “proper officer” in relation to any function to be performed under this Act,
means the Commissioner or the officer of the central tax who is assigned that function
by the Commissioner in the Board;
(92) “quarter” shall mean a period comprising three consecutive calendar months,
ending on the last day of March, June, September and December of a calendar year;
(93) “recipient” of supply of goods or services or both, means—
(a) where a consideration is payable for the supply of goods or services or
both, the person who is liable to pay that consideration;
(b) where no consideration is payable for the supply of goods, the person
to whom the goods are delivered or made available, or to whom possession or
use of the goods is given or made available; and
(c) where no consideration is payable for the supply of a service, the
person to whom the service is rendered,
and any reference to a person to whom a supply is made shall be construed as a
reference to the recipient of the supply and shall include an agent acting as such on
behalf of the recipient in relation to the goods or services or both supplied;
(94) “registered person” means a person who is registered under section 25 but
does not include a person having a Unique Identity Number;
(95) “regulations” means the regulations made by the Board under this Act on
the recommendations of the Council;14 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(96) “removal’’ in relation to goods, means—
(a) despatch of the goods for delivery by the supplier thereof or by any
other person acting on behalf of such supplier; or
(b) collection of the goods by the recipient thereof or by any other person
acting on behalf of such recipient;
(97) “return” means any return prescribed or otherwise required to be furnished
by or under this Act or the rules made thereunder;
(98) “reverse charge” means the liability to pay tax by the recipient of supply of
goods or services or both instead of the supplier of such goods or services or both
under sub-section (3) or sub-section (4) of section 9, or under sub-section (3) or
sub-section (4) of section 5 of the Integrated Goods and Services Tax Act;
(99) “Revisional Authority” means an authority appointed or authorised for
revision of decision or orders as referred to in section 108;
(100) “Schedule” means a Schedule appended to this Act;
(101) “securities” shall have the same meaning as assigned to it in clause (h) of
section 2 of the Securities Contracts (Regulation) Act, 1956; 42 of 1956.
(102) “services” means anything other than goods, money and securities but
includes activities relating to the use of money or its conversion by cash or by any
other mode, from one form, currency or denomination, to another form, currency or
denomination for which a separate consideration is charged;
(103) “State” includes a Union territory with Legislature;
(104) “State tax” means the tax levied under any State Goods and Services Tax
Act;
(105) “supplier” in relation to any goods or services or both, shall mean the
person supplying the said goods or services or both and shall include an agent
acting as such on behalf of such supplier in relation to the goods or services or both
supplied;
(106) “tax period” means the period for which the return is required to be furnished;
(107) “taxable person” means a person who is registered or liable to be registered
under section 22 or section 24;
(108) “taxable supply” means a supply of goods or services or both which is
leviable to tax under this Act;
(109) “taxable territory” means the territory to which the provisions of this Act
apply;
(110) “telecommunication service” means service of any description (including
electronic mail, voice mail, data services, audio text services, video text services,
radio paging and cellular mobile telephone services) which is made available to
users by means of any transmission or reception of signs, signals, writing,
images and sounds or intelligence of any nature, by wire, radio, visual or other
electromagnetic means;
(111) “the State Goods and Services Tax Act” means the respective State Goods
and Services Tax Act, 2017;
(112) “turnover in State” or “turnover in Union territory” means the aggregate
value of all taxable supplies (excluding the value of inward supplies on which tax is
payable by a person on reverse charge basis) and exempt supplies made within a State
or Union territory by a taxable person, exports of goods or services or both
and inter-State supplies of goods or services or both made from the State or UnionSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 15
territory by the said taxable person but excludes central tax, State tax, Union territory
tax, integrated tax and cess;
(113) “usual place of residence” means––
(a) in case of an individual, the place where he ordinarily resides;
(b) in other cases, the place where the person is incorporated or otherwise
legally constituted;
(114) “Union territory” means the territory of—
(a) the Andaman and Nicobar Islands;
(b) Lakshadweep;
(c) Dadra and Nagar Haveli;
(d) Daman and Diu
(e) Chandigarh; and
(f) other territory.
Explanation.––For the purposes of this Act, each of the territories specified
in sub-clauses (a) to (f) shall be considered to be a separate Union territory;
(115) “Union territory tax” means the Union territory goods and services tax
levied under the Union Territory Goods and Services Tax Act;
(116) “Union Territory Goods and Services Tax Act” means the Union Territory
Goods and Services Tax Act, 2017;
(117) “valid return” means a return furnished under sub-section (1) of section 39
on which self-assessed tax has been paid in full;
(118) “voucher” means an instrument where there is an obligation to accept it as
consideration or part consideration for a supply of goods or services or both and
where the goods or services or both to be supplied or the identities of their potential
suppliers are either indicated on the instrument itself or in related documentation,
including the terms and conditions of use of such instrument;
(119) “works contract” means a contract for building, construction, fabrication,
completion, erection, installation, fitting out, improvement, modification, repair,
maintenance, renovation, alteration or commissioning of any immovable property
wherein transfer of property in goods (whether as goods or in some other form) is
involved in the execution of such contract;
(120) words and expressions used and not defined in this Act but defined in the
Integrated Goods and Services Tax Act, the Union Territory Goods and Services Tax
Act and the Goods and Services Tax (Compensation to States) Act shall have the same
meaning as assigned to them in those Acts;
(121) any reference in this Act to a law which is not in force in the State of Jammu
and Kashmir, shall, in relation to that State be construed as a reference to the
corresponding law, if any, in force in that State.
CHAPTER II
ADMINISTRATION
3. The Government shall, by notification, appoint the following classes of officers for Officers under
the purposes of this Act, namely:–– this Act.
(a) Principal Chief Commissioners of Central Tax or Principal Directors General of
Central Tax,
(b) Chief Commissioners of Central Tax or Directors General of Central Tax,
(c) Principal Commissioners of Central Tax or Principal Additional Directors
General of Central Tax,
(d) Commissioners of Central Tax or Additional Directors General of Central Tax,16 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(e) Additional Commissioners of Central Tax or Additional Directors of
Central Tax,
(f) Joint Commissioners of Central Tax or Joint Directors of Central Tax,
(g) Deputy Commissioners of Central Tax or Deputy Directors of Central Tax,
(h) Assistant Commissioners of Central Tax or Assistant Directors of
Central Tax, and
(i) any other class of officers as it may deem fit:
Provided that the officers appointed under the Central Excise Act, 1944 shall be deemed 1 of 1944.
to be the officers appointed under the provisions of this Act.
Appointment 4. (1) The Board may, in addition to the officers as may be notified by the Government
of officers. under section 3, appoint such persons as it may think fit to be the officers under this Act.
(2) Without prejudice to the provisions of sub-section (1), the Board may, by
order, authorise any officer referred to in clauses (a) to (h) of section 3 to appoint officers of
central tax below the rank of Assistant Commissioner of central tax for the administration of
this Act.
Powers of 5. (1) Subject to such conditions and limitations as the Board may impose, an officer of
officers. central tax may exercise the powers and discharge the duties conferred or imposed on him
under this Act.
(2) An officer of central tax may exercise the powers and discharge the duties conferred
or imposed under this Act on any other officer of central tax who is subordinate to him.
(3) The Commissioner may, subject to such conditions and limitations as may be
specified in this behalf by him, delegate his powers to any other officer who is subordinate
to him.
(4) Notwithstanding anything contained in this section, an Appellate Authority shall
not exercise the powers and discharge the duties conferred or imposed on any other officer
of central tax.
Authorisation 6. (1) Without prejudice to the provisions of this Act, the officers appointed under
of officers of the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act
State tax or
are authorised to be the proper officers for the purposes of this Act, subject to such
Union
territory tax conditions as the Government shall, on the recommendations of the Council, by notification,
as proper specify.
officer in
certain (2) Subject to the conditions specified in the notification issued under
circumstances. sub-section (1),––
(a) where any proper officer issues an order under this Act, he shall also issue an
order under the State Goods and Services Tax Act or the Union Territory Goods and
Services Tax Act, as authorised by the State Goods and Services Tax Act or the Union
Territory Goods and Services Tax Act, as the case may be, under intimation to the
jurisdictional officer of State tax or Union territory tax;
(b) where a proper officer under the State Goods and Services Tax Act or the
Union Territory Goods and Services Tax Act has initiated any proceedings on a subject
matter, no proceedings shall be initiated by the proper officer under this Act on the
same subject matter.
(3) Any proceedings for rectification, appeal and revision, wherever applicable, of any
order passed by an officer appointed under this Act shall not lie before an officer appointed
under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax
Act.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 17
CHAPTER III
LEVY AND COLLECTION OF TAX
7. (1) For the purposes of this Act, the expression “supply” includes–– Scope of
supply.
(a) all forms of supply of goods or services or both such as sale, transfer, barter,
exchange, licence, rental, lease or disposal made or agreed to be made for a consideration
by a person in the course or furtherance of business;
(b) import of services for a consideration whether or not in the course or
furtherance of business;
(c) the activities specified in Schedule I, made or agreed to be made without a
consideration; and
(d) the activities to be treated as supply of goods or supply of services as
referred to in Schedule II.
(2) Notwithstanding anything contained in sub-section (1),––
(a) activities or transactions specified in Schedule III; or
(b) such activities or transactions undertaken by the Central Government, a
State Government or any local authority in which they are engaged as public
authorities, as may be notified by the Government on the recommendations of the
Council,
shall be treated neither as a supply of goods nor a supply of services.
(3) Subject to the provisions of sub-sections (1) and (2), the Government may, on the
recommendations of the Council, specify, by notification, the transactions that are to be
treated as—
(a) a supply of goods and not as a supply of services; or
(b) a supply of services and not as a supply of goods.
8. The tax liability on a composite or a mixed supply shall be determined in the following Tax liability
manner, namely:— on composite
and mixed
(a) a composite supply comprising two or more supplies, one of which is a supplies.
principal supply, shall be treated as a supply of such principal supply; and
(b) a mixed supply comprising two or more supplies shall be treated as a supply
of that particular supply which attracts the highest rate of tax.
9. (1) Subject to the provisions of sub-section (2), there shall be levied a tax called the Levy and
central goods and services tax on all intra-State supplies of goods or services or both, except collection.
on the supply of alcoholic liquor for human consumption, on the value determined under
section 15 and at such rates, not exceeding twenty per cent., as may be notified by the
Government on the recommendations of the Council and collected in such manner as may be
prescribed and shall be paid by the taxable person.
(2) The central tax on the supply of petroleum crude, high speed diesel, motor spirit
(commonly known as petrol), natural gas and aviation turbine fuel shall be levied with effect
from such date as may be notified by the Government on the recommendations of the
Council.
(3) The Government may, on the recommendations of the Council, by notification,
specify categories of supply of goods or services or both, the tax on which shall be paid on
reverse charge basis by the recipient of such goods or services or both and all the provisions
of this Act shall apply to such recipient as if he is the person liable for paying the tax in
relation to the supply of such goods or services or both.18 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(4) The central tax in respect of the supply of taxable goods or services or both by a
supplier, who is not registered, to a registered person shall be paid by such person on
reverse charge basis as the recipient and all the provisions of this Act shall apply to such
recipient as if he is the person liable for paying the tax in relation to the supply of such goods
or services or both.
(5) The Government may, on the recommendations of the Council, by notification,
specify categories of services the tax on intra-State supplies of which shall be paid by the
electronic commerce operator if such services are supplied through it, and all the provisions
of this Act shall apply to such electronic commerce operator as if he is the supplier liable for
paying the tax in relation to the supply of such services:
Provided that where an electronic commerce operator does not have a physical presence
in the taxable territory, any person representing such electronic commerce operator for any
purpose in the taxable territory shall be liable to pay tax:
Provided further that where an electronic commerce operator does not have a physical
presence in the taxable territory and also he does not have a representative in the said
territory, such electronic commerce operator shall appoint a person in the taxable territory for
the purpose of paying tax and such person shall be liable to pay tax.
Composition 10. (1) Notwithstanding anything to the contrary contained in this Act but subject to
levy. the provisions of sub-sections (3) and (4) of section 9, a registered person, whose aggregate
turnover in the preceding financial year did not exceed fifty lakh rupees, may opt to pay, in
lieu of the tax payable by him, an amount calculated at such rate as may be prescribed, but
not exceeding,––
(a) one per cent. of the turnover in State or turnover in Union territory in case of
a manufacturer,
(b) two and a half per cent. of the turnover in State or turnover in Union territory
in case of persons engaged in making supplies referred to in clause (b) of paragraph 6
of Schedule II, and
(c) half per cent. of the turnover in State or turnover in Union territory in case of
other suppliers,
subject to such conditions and restrictions as may be prescribed:
Provided that the Government may, by notification, increase the said limit of fifty lakh
rupees to such higher amount, not exceeding one crore rupees, as may be recommended by
the Council.
(2) The registered person shall be eligible to opt under sub-section (1), if:—
(a) he is not engaged in the supply of services other than supplies referred to in
clause (b) of paragraph 6 of Schedule II;
(b) he is not engaged in making any supply of goods which are not leviable to tax
under this Act;
(c) he is not engaged in making any inter-State outward supplies of goods;
(d) he is not engaged in making any supply of goods through an electronic
commerce operator who is required to collect tax at source under section 52; and
(e) he is not a manufacturer of such goods as may be notified by the Government
on the recommendations of the Council:
Provided that where more than one registered persons are having the same Permanent
Account Number (issued under the Income-tax Act, 1961), the registered person shall not be 43 of 1961.
eligible to opt for the scheme under sub-section (1) unless all such registered persons opt to
pay tax under that sub-section.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 19
(3) The option availed of by a registered person under sub-section (1) shall lapse with
effect from the day on which his aggregate turnover during a financial year exceeds the limit
specified under sub-section (1).
(4) A taxable person to whom the provisions of sub-section (1) apply shall not collect
any tax from the recipient on supplies made by him nor shall he be entitled to any credit of
input tax.
(5) If the proper officer has reasons to believe that a taxable person has paid tax under
sub-section (1) despite not being eligible, such person shall, in addition to any tax that may
be payable by him under any other provisions of this Act, be liable to a penalty and the
provisions of section 73 or section 74 shall, mutatis mutandis, apply for determination of tax
and penalty.
11. (1) Where the Government is satisfied that it is necessary in the public interest so Power to
to do, it may, on the recommendations of the Council, by notification, exempt generally, either grant
absolutely or subject to such conditions as may be specified therein, goods or services or exemption
from tax.
both of any specified description from the whole or any part of the tax leviable thereon with
effect from such date as may be specified in such notification.
(2) Where the Government is satisfied that it is necessary in the public interest so to
do, it may, on the recommendations of the Council, by special order in each case, under
circumstances of an exceptional nature to be stated in such order, exempt from payment of tax
any goods or services or both on which tax is leviable.
(3) The Government may, if it considers necessary or expedient so to do for the
purpose of clarifying the scope or applicability of any notification issued under
sub-section (1) or order issued under sub-section (2), insert an explanation in such
notification or order, as the case may be, by notification at any time within one year of
issue of the notification under sub-section (1) or order under sub-section (2), and every
such explanation shall have effect as if it had always been the part of the first such
notification or order, as the case may be.
Explanation.––For the purposes of this section, where an exemption in respect of
any goods or services or both from the whole or part of the tax leviable thereon has been
granted absolutely, the registered person supplying such goods or services or both shall
not collect the tax, in excess of the effective rate, on such supply of goods or services or
both.
CHAPTER IV
TIME AND VALUE OF SUPPLY
12. (1) The liability to pay tax on goods shall arise at the time of supply, as determined Time of
in accordance with the provisions of this section. supply of
goods.
(2) The time of supply of goods shall be the earlier of the following dates, namely:—
(a) the date of issue of invoice by the supplier or the last date on which he is
required, under sub-section (1) of section 31, to issue the invoice with respect to the
supply; or
(b) the date on which the supplier receives the payment with respect to the
supply:
Provided that where the supplier of taxable goods receives an amount up to one
thousand rupees in excess of the amount indicated in the tax invoice, the time of
supply to the extent of such excess amount shall, at the option of the said supplier, be
the date of issue of invoice in respect of such excess amount.20 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Explanation 1.––For the purposes of clauses (a) and (b), “supply” shall be
deemed to have been made to the extent it is covered by the invoice or, as the case may
be, the payment.
Explanation 2.––For the purposes of clause (b), “the date on which the supplier
receives the payment” shall be the date on which the payment is entered in his books
of account or the date on which the payment is credited to his bank account, whichever
is earlier.
(3) In case of supplies in respect of which tax is paid or liable to be paid on reverse
charge basis, the time of supply shall be the earliest of the following dates, namely:—
(a) the date of the receipt of goods; or
(b) the date of payment as entered in the books of account of the recipient or the
date on which the payment is debited in his bank account, whichever is earlier; or
(c) the date immediately following thirty days from the date of issue of invoice or
any other document, by whatever name called, in lieu thereof by the supplier:
Provided that where it is not possible to determine the time of supply under
clause (a) or clause (b) or clause (c), the time of supply shall be the date of entry in the
books of account of the recipient of supply.
(4) In case of supply of vouchers by a supplier, the time of supply shall be—
(a) the date of issue of voucher, if the supply is identifiable at that point; or
(b) the date of redemption of voucher, in all other cases.
(5) Where it is not possible to determine the time of supply under the provisions of
sub-section (2) or sub-section (3) or sub-section (4), the time of supply shall––
(a) in a case where a periodical return has to be filed, be the date on which such
return is to be filed; or
(b) in any other case, be the date on which the tax is paid.
(6) The time of supply to the extent it relates to an addition in the value of supply by
way of interest, late fee or penalty for delayed payment of any consideration shall be the date
on which the supplier receives such addition in value.
Time of supply 13. (1) The liability to pay tax on services shall arise at the time of supply, as determined
of services.
in accordance with the provisions of this section.
(2) The time of supply of services shall be the earliest of the following dates, namely:—
(a) the date of issue of invoice by the supplier, if the invoice is issued within the
period prescribed under sub-section (2) of section 31 or the date of receipt of payment,
whichever is earlier; or
(b) the date of provision of service, if the invoice is not issued within the period
prescribed under sub-section (2) of section 31 or the date of receipt of payment,
whichever is earlier; or
(c) the date on which the recipient shows the receipt of services in his books of
account, in a case where the provisions of clause (a) or clause (b) do not apply:
Provided that where the supplier of taxable service receives an amount up to one
thousand rupees in excess of the amount indicated in the tax invoice, the time of
supply to the extent of such excess amount shall, at the option of the said supplier, be
the date of issue of invoice relating to such excess amount.
Explanation.––For the purposes of clauses (a) and (b)––SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 21
(i) the supply shall be deemed to have been made to the extent it is covered
by the invoice or, as the case may be, the payment;
(ii) “the date of receipt of payment” shall be the date on which the payment
is entered in the books of account of the supplier or the date on which the
payment is credited to his bank account, whichever is earlier.
(3) In case of supplies in respect of which tax is paid or liable to be paid on reverse
charge basis, the time of supply shall be the earlier of the following dates, namely:––
(a) the date of payment as entered in the books of account of the recipient or the
date on which the payment is debited in his bank account, whichever is earlier; or
(b) the date immediately following sixty days from the date of issue of invoice or
any other document, by whatever name called, in lieu thereof by the supplier:
Provided that where it is not possible to determine the time of supply under
clause (a) or clause (b), the time of supply shall be the date of entry in the books of
account of the recipient of supply:
Provided further that in case of supply by associated enterprises, where the
supplier of service is located outside India, the time of supply shall be the date of entry
in the books of account of the recipient of supply or the date of payment, whichever is
earlier.
(4) In case of supply of vouchers by a supplier, the time of supply shall be––
(a) the date of issue of voucher, if the supply is identifiable at that point; or
(b) the date of redemption of voucher, in all other cases.
(5) Where it is not possible to determine the time of supply under the provisions of
sub-section (2) or sub-section (3) or sub-section (4), the time of supply shall––
(a) in a case where a periodical return has to be filed, be the date on which such
return is to be filed; or
(b) in any other case, be the date on which the tax is paid.
(6) The time of supply to the extent it relates to an addition in the value of supply by
way of interest, late fee or penalty for delayed payment of any consideration shall be the date
on which the supplier receives such addition in value.
14. Notwithstanding anything contained in section 12 or section 13, the time of supply, Change in
where there is a change in the rate of tax in respect of goods or services or both, shall be rate of tax in
respect of
determined in the following manner, namely:––
supply of
goods or
(a) in case the goods or services or both have been supplied before the change
services.
in rate of tax,––
(i) where the invoice for the same has been issued and the payment is also
received after the change in rate of tax, the time of supply shall be the date of
receipt of payment or the date of issue of invoice, whichever is earlier; or
(ii) where the invoice has been issued prior to the change in rate of tax but
payment is received after the change in rate of tax, the time of supply shall be the
date of issue of invoice; or
(iii) where the payment has been received before the change in rate of tax,
but the invoice for the same is issued after the change in rate of tax, the time of
supply shall be the date of receipt of payment;
(b) in case the goods or services or both have been supplied after the change in
rate of tax,––22 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(i) where the payment is received after the change in rate of tax but the
invoice has been issued prior to the change in rate of tax, the time of supply shall
be the date of receipt of payment; or
(ii) where the invoice has been issued and payment is received before the
change in rate of tax, the time of supply shall be the date of receipt of payment or
date of issue of invoice, whichever is earlier; or
(iii) where the invoice has been issued after the change in rate of tax but
the payment is received before the change in rate of tax, the time of supply shall
be the date of issue of invoice:
Provided that the date of receipt of payment shall be the date of credit in
the bank account if such credit in the bank account is after four working days
from the date of change in the rate of tax.
Explanation.––For the purposes of this section, “the date of receipt of
payment” shall be the date on which the payment is entered in the books of
account of the supplier or the date on which the payment is credited to his bank
account, whichever is earlier.
Value of 15. (1) The value of a supply of goods or services or both shall be the transaction
taxable
value, which is the price actually paid or payable for the said supply of goods or services or
supply.
both where the supplier and the recipient of the supply are not related and the price is the
sole consideration for the supply.
(2) The value of supply shall include–––
(a) any taxes, duties, cesses, fees and charges levied under any law for the time
being in force other than this Act, the State Goods and Services Tax Act, the Union
Territory Goods and Services Tax Act and the Goods and Services Tax (Compensation
to States) Act, if charged separately by the supplier;
(b) any amount that the supplier is liable to pay in relation to such supply but
which has been incurred by the recipient of the supply and not included in the price
actually paid or payable for the goods or services or both;
(c) incidental expenses, including commission and packing, charged by the
supplier to the recipient of a supply and any amount charged for anything done by the
supplier in respect of the supply of goods or services or both at the time of, or before
delivery of goods or supply of services;
(d) interest or late fee or penalty for delayed payment of any consideration for
any supply; and
(e) subsidies directly linked to the price excluding subsidies provided by the
Central Government and State Governments.
Explanation.––For the purposes of this sub-section, the amount of subsidy
shall be included in the value of supply of the supplier who receives the subsidy.
(3) The value of the supply shall not include any discount which is given––
(a) before or at the time of the supply if such discount has been duly recorded in
the invoice issued in respect of such supply; and
(b) after the supply has been effected, if—
(i) such discount is established in terms of an agreement entered into at or
before the time of such supply and specifically linked to relevant invoices; and
(ii) input tax credit as is attributable to the discount on the basis of
document issued by the supplier has been reversed by the recipient of the
supply.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 23
(4) Where the value of the supply of goods or services or both cannot be determined
under sub-section (1), the same shall be determined in such manner as may be prescribed.
(5) Notwithstanding anything contained in sub-section (1) or sub-section (4), the
value of such supplies as may be notified by the Government on the recommendations of the
Council shall be determined in such manner as may be prescribed.
Explanation.—For the purposes of this Act,––
(a) persons shall be deemed to be “related persons” if––
(i) such persons are officers or directors of one another’s businesses;
(ii) such persons are legally recognised partners in business;
(iii) such persons are employer and employee;
(iv) any person directly or indirectly owns, controls or holds twenty-five
per cent. or more of the outstanding voting stock or shares of both of them;
(v) one of them directly or indirectly controls the other;
(vi) both of them are directly or indirectly controlled by a third person;
(vii) together they directly or indirectly control a third person; or
(viii) they are members of the same family;
(b) the term “person” also includes legal persons;
(c) persons who are associated in the business of one another in that one is the
sole agent or sole distributor or sole concessionaire, howsoever described, of the
other, shall be deemed to be related.
CHAPTER V
INPUT TAX CREDIT
16. (1) Every registered person shall, subject to such conditions and restrictions as Eligibility and
may be prescribed and in the manner specified in section 49, be entitled to take credit of input conditions for
taking input
tax charged on any supply of goods or services or both to him which are used or intended to
tax credit.
be used in the course or furtherance of his business and the said amount shall be credited to
the electronic credit ledger of such person.
(2) Notwithstanding anything contained in this section, no registered person shall be
entitled to the credit of any input tax in respect of any supply of goods or services or both to
him unless,––
(a) he is in possession of a tax invoice or debit note issued by a supplier registered
under this Act, or such other tax paying documents as may be prescribed;
(b) he has received the goods or services or both.
Explanation.—For the purposes of this clause, it shall be deemed that the
registered person has received the goods where the goods are delivered by the supplier
to a recipient or any other person on the direction of such registered person, whether
acting as an agent or otherwise, before or during movement of goods, either by way of
transfer of documents of title to goods or otherwise;
(c) subject to the provisions of section 41,the tax charged in respect of such
supply has been actually paid to the Government, either in cash or through utilisation
of input tax credit admissible in respect of the said supply; and
(d) he has furnished the return under section 39:
Provided that where the goods against an invoice are received in lots or
instalments, the registered person shall be entitled to take credit upon receipt of the
last lot or instalment:
Provided further that where a recipient fails to pay to the supplier of goods or
services or both,other than the supplies on which tax is payable on reverse charge
basis, the amount towards the value of supply along with tax payable thereon within a24 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
period of one hundred and eighty days from the date of issue of invoice by the
supplier, an amount equal to the input tax credit availed by the recipient shall be added
to his output tax liability, along with interest thereon, in such manner as may be
prescribed:
Provided also that the recipient shall be entitled to avail of the credit of input tax
on payment made by him of the amount towards the value of supply of goods or
services or both along with tax payable thereon.
(3) Where the registered person has claimed depreciation on the tax component of the
cost of capital goods and plant and machinery under the provisions of the Income-tax
Act, 1961, the input tax credit on the said tax component shall not be allowed. 43 of 1961.
(4) A registered person shall not be entitled to take input tax credit in respect of any
invoice or debit note for supply of goods or services or both after the due date of furnishing
of the return under section 39 for the month of September following the end of financial year
to which such invoice or invoice relating to such debit note pertains or furnishing of the
relevant annual return, whichever is earlier.
Apportionment 17. (1) Where the goods or services or both are used by the registered person partly
of credit and for the purpose of any business and partly for other purposes, the amount of credit shall be
blocked
restricted to so much of the input tax as is attributable to the purposes of his business.
credits.
(2) Where the goods or services or both are used by the registered person partly for
effecting taxable supplies including zero-rated supplies under this Act or under the Integrated
Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the
amount of credit shall be restricted to so much of the input tax as is attributable to the said
taxable supplies including zero-rated supplies.
(3) The value of exempt supply under sub-section (2) shall be such as may be prescribed,
and shall include supplies on which the recipient is liable to pay tax on reverse charge basis,
transactions in securities, sale of land and, subject to clause (b) of paragraph 5 of Schedule
II, sale of building.
(4) A banking company or a financial institution including a non-banking financial
company, engaged in supplying services by way of accepting deposits, extending loans or
advances shall have the option to either comply with the provisions of sub-section (2), or
avail of, every month, an amount equal to fifty per cent. of the eligible input tax credit on
inputs, capital goods and input services in that month and the rest shall lapse:
Provided that the option once exercised shall not be withdrawn during the remaining
part of the financial year:
Provided further that the restriction of fifty per cent. shall not apply to the tax paid on
supplies made by one registered person to another registered person having the same
Permanent Account Number.
(5) Notwithstanding anything contained in sub-section (1) of section 16 and
sub-section (1) of section 18, input tax credit shall not be available in respect of the following,
namely:—
(a) motor vehicles and other conveyances except when they are used––
(i) for making the following taxable supplies, namely:—
(A) further supply of such vehicles or conveyances ; or
(B) transportation of passengers; or
(C) imparting training on driving, flying, navigating such vehicles
or conveyances;
(ii) for transportation of goods;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 25
(b) the following supply of goods or services or both:—
(i) food and beverages, outdoor catering, beauty treatment, health services,
cosmetic and plastic surgery except where an inward supply of goods or services
or both of a particular category is used by a registered person for making an
outward taxable supply of the same category of goods or services or both or as
an element of a taxable composite or mixed supply;
(ii) membership of a club, health and fitness centre;
(iii) rent-a-cab, life insurance and health insurance except where––
(A) the Government notifies the services which are obligatory for an
employer to provide to its employees under any law for the time being in
force; or
(B) such inward supply of goods or services or both of a particular
category is used by a registered person for making an outward taxable
supply of the same category of goods or services or both or as part of a
taxable composite or mixed supply; and
(iv) travel benefits extended to employees on vacation such as leave or
home travel concession;
(c) works contract services when supplied for construction of an immovable
property (other than plant and machinery) except where it is an input service for further
supply of works contract service;
(d) goods or services or both received by a taxable person for construction of an
immovable property (other than plant or machinery) on his own account including
when such goods or services or both are used in the course or furtherance of business.
Explanation.––For the purposes of clauses (c) and (d), the expression
“construction” includes re-construction, renovation, additions or alterations or repairs,
to the extent of capitalisation, to the said immovable property;
(e) goods or services or both on which tax has been paid under section 10;
(f) goods or services or both received by a non-resident taxable person except
on goods imported by him;
(g) goods or services or both used for personal consumption;
(h) goods lost, stolen, destroyed, written off or disposed of by way of gift or free
samples; and
(i) any tax paid in accordance with the provisions of sections 74, 129 and 130.
(6) The Government may prescribe the manner in which the credit referred to in
sub-sections (1) and (2) may be attributed.
Explanation.––For the purposes of this Chapter and Chapter VI, the expression “plant
and machinery” means apparatus, equipment, and machinery fixed to earth by foundation or
structural support that are used for making outward supply of goods or services or both and
includes such foundation and structural supports but excludes—
(i) land, building or any other civil structures;
(ii) telecommunication towers; and
(iii) pipelines laid outside the factory premises.
18. (1) Subject to such conditions and restrictions as may be prescribed— Availability of
credit in
(a) a person who has applied for registration under this Act within thirty days special
from the date on which he becomes liable to registration and has been granted such circumstances.26 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
registration shall be entitled to take credit of input tax in respect of inputs held in stock
and inputs contained in semi-finished or finished goods held in stock on the day
immediately preceding the date from which he becomes liable to pay tax under the
provisions of this Act;
(b) a person who takes registration under sub-section (3) of section 25 shall be
entitled to take credit of input tax in respect of inputs held in stock and inputs contained
in semi-finished or finished goods held in stock on the day immediately preceding the
date of grant of registration;
(c) where any registered person ceases to pay tax under section 10, he shall be
entitled to take credit of input tax in respect of inputs held in stock, inputs contained in
semi-finished or finished goods held in stock and on capital goods on the day immediately
preceding the date from which he becomes liable to pay tax under section 9:
Provided that the credit on capital goods shall be reduced by such percentage
points as may be prescribed;
(d) where an exempt supply of goods or services or both by a registered person
becomes a taxable supply, such person shall be entitled to take credit of input tax in
respect of inputs held in stock and inputs contained in semi-finished or finished goods
held in stock relatable to such exempt supply and on capital goods exclusively used
for such exempt supply on the day immediately preceding the date from which such
supply becomes taxable:
Provided that the credit on capital goods shall be reduced by such percentage
points as may be prescribed.
(2) A registered person shall not be entitled to take input tax credit under
sub-section (1) in respect of any supply of goods or services or both to him after the expiry
of one year from the date of issue of tax invoice relating to such supply.
(3) Where there is a change in the constitution of a registered person on account of
sale, merger, demerger, amalgamation, lease or transfer of the business with the specific
provisions for transfer of liabilities, the said registered person shall be allowed to transfer the
input tax credit which remains unutilised in his electronic credit ledger to such sold, merged,
demerged, amalgamated, leased or transferred business in such manner as may be prescribed.
(4) Where any registered person who has availed of input tax credit opts to pay tax
under section 10 or, where the goods or services or both supplied by him become wholly
exempt, he shall pay an amount, by way of debit in the electronic credit ledger or electronic
cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs
contained in semi-finished or finished goods held in stock and on capital goods, reduced by
such percentage points as may be prescribed, on the day immediately preceding the date of
exercising of such option or, as the case may be, the date of such exemption:
Provided that after payment of such amount, the balance of input tax credit, if any,
lying in his electronic credit ledger shall lapse.
(5) The amount of credit under sub-section (1) and the amount payable under
sub-section (4) shall be calculated in such manner as may be prescribed.
(6) In case of supply of capital goods or plant and machinery, on which input tax credit
has been taken, the registered person shall pay an amount equal to the input tax credit taken
on the said capital goods or plant and machinery reduced by such percentage points as may
be prescribed or the tax on the transaction value of such capital goods or plant and machinery
determined under section 15, whichever is higher:
Provided that where refractory bricks, moulds and dies, jigs and fixtures are supplied
as scrap, the taxable person may pay tax on the transaction value of such goods determined
under section 15.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 27
19. (1) The principal shall, subject to such conditions and restrictions as may be Taking input
prescribed, be allowed input tax credit on inputs sent to a job worker for job work. tax credit in
respect of
(2) Notwithstanding anything contained in clause (b) of sub-section (2) of section 16, inputs and
capital goods
the principal shall be entitled to take credit of input tax on inputs even if the inputs are
sent for job
directly sent to a job worker for job work without being first brought to his place of business.
work.
(3) Where the inputs sent for job work are not received back by the principal after
completion of job work or otherwise or are not supplied from the place of business of the job
worker in accordance with clause (a) or clause (b) of sub-section (1) of section 143 within
one year of being sent out, it shall be deemed that such inputs had been supplied by the
principal to the job worker on the day when the said inputs were sent out:
Provided that where the inputs are sent directly to a job worker, the period of one year
shall be counted from the date of receipt of inputs by the job worker.
(4) The principal shall, subject to such conditions and restrictions as may be prescribed,
be allowed input tax credit on capital goods sent to a job worker for job work.
(5) Notwithstanding anything contained in clause (b) of sub-section (2) of section 16,
the principal shall be entitled to take credit of input tax on capital goods even if the capital
goods are directly sent to a job worker for job work without being first brought to his place
of business.
(6) Where the capital goods sent for job work are not received back by the principal
within a period of three years of being sent out, it shall be deemed that such capital goods
had been supplied by the principal to the job worker on the day when the said capital goods
were sent out:
Provided that where the capital goods are sent directly to a job worker, the period of
three years shall be counted from the date of receipt of capital goods by the job worker.
(7) Nothing contained in sub-section (3) or sub-section (6) shall apply to moulds and
dies, jigs and fixtures, or tools sent out to a job worker for job work.
Explanation.––For the purpose of this section, “principal” means the person referred
to in section 143.
20. (1) The Input Service Distributor shall distribute the credit of central tax as central Manner of
tax or integrated tax and integrated tax as integrated tax or central tax, by way of issue of a distribution of
document containing the amount of input tax credit being distributed in such manner as may credit by
Input Service
be prescribed.
Distributor.
(2) The Input Service Distributor may distribute the credit subject to the following
conditions, namely:––
(a) the credit can be distributed to the recipients of credit against a document
containing such details as may be prescribed;
(b) the amount of the credit distributed shall not exceed the amount of credit
available for distribution;
(c) the credit of tax paid on input services attributable to a recipient of credit shall
be distributed only to that recipient;
(d) the credit of tax paid on input services attributable to more than one recipient
of credit shall be distributed amongst such recipients to whom the input service is
attributable and such distribution shall be pro rata on the basis of the turnover in a
State or turnover in a Union territory of such recipient, during the relevant period, to
the aggregate of the turnover of all such recipients to whom such input service is
attributable and which are operational in the current year, during the said relevant
period;28 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(e) the credit of tax paid on input services attributable to all recipients of credit
shall be distributed amongst such recipients and such distribution shall be pro rata on
the basis of the turnover in a State or turnover in a Union territory of such recipient,
during the relevant period, to the aggregate of the turnover of all recipients and which
are operational in the current year, during the said relevant period.
Explanation.––For the purposes of this section,––
(a) the “relevant period” shall be––
(i) if the recipients of credit have turnover in their States or Union
territories in the financial year preceding the year during which credit is to
be distributed, the said financial year; or
(ii) if some or all recipients of the credit do not have any turnover in
their States or Union territories in the financial year preceding the year
during which the credit is to be distributed, the last quarter for which
details of such turnover of all the recipients are available, previous to the
month during which credit is to be distributed;
(b) the expression “recipient of credit” means the supplier of goods or
services or both having the same Permanent Account Number as that of the
Input Service Distributor;
(c) the term “turnover”, in relation to any registered person engaged in the
supply of taxable goods as well as goods not taxable under this Act, means the
value of turnover, reduced by the amount of any duty or tax levied under entry
84 of List I of the Seventh Schedule to the Constitution and entry 51 and 54 of
List II of the said Schedule.
Manner of 21. Where the Input Service Distributor distributes the credit in contravention
recovery of of the provisions contained in section 20 resulting in excess distribution of credit to
credit
one or more recipients of credit, the excess credit so distributed shall be recovered
distributed in
from such recipients along with interest, and the provisions of section 73 or section74,
excess.
as the case may be, shall, mutatis mutandis, apply for determination of amount to be
recovered.
CHAPTER VI
REGISTRATION
Persons liable 22. (1) Every supplier shall be liable to be registered under this Act in the State or
for Union territory, other than special category States, from where he makes a taxable supply of
registration.
goods or services or both, if his aggregate turnover in a financial year exceeds twenty lakh
rupees:
Provided that where such person makes taxable supplies of goods or services or both
from any of the special category States, he shall be liable to be registered if his aggregate
turnover in a financial year exceeds ten lakh rupees.
(2) Every person who, on the day immediately preceding the appointed day, is registered
or holds a licence under an existing law, shall be liable to be registered under this Act with
effect from the appointed day.
(3) Where a business carried on by a taxable person registered under this Act is
transferred, whether on account of succession or otherwise, to another person as a going
concern, the transferee or the successor, as the case may be, shall be liable to be registered
with effect from the date of such transfer or succession.
(4) Notwithstanding anything contained in sub-sections (1) and (3), in a case of
transfer pursuant to sanction of a scheme or an arrangement for amalgamation or, as the case
may be, demerger of two or more companies pursuant to an order of a High Court, TribunalSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 29
or otherwise, the transferee shall be liable to be registered, with effect from the date on which
the Registrar of Companies issues a certificate of incorporation giving effect to such order of
the High Court or Tribunal.
Explanation.––For the purposes of this section,––
(i) the expression “aggregate turnover” shall include all supplies made by the
taxable person, whether on his own account or made on behalf of all his principals;
(ii) the supply of goods, after completion of job work, by a registered job worker
shall be treated as the supply of goods by the principal referred to in section 143, and
the value of such goods shall not be included in the aggregate turnover of the registered
job worker;
(iii) the expression “special category States” shall mean the States as specified
in sub-clause (g) of clause (4) of article 279A of the Constitution.
23. (1) The following persons shall not be liable to registration, namely:–– Persons not
liable for
(a) any person engaged exclusively in the business of supplying goods or
registration.
services or both that are not liable to tax or wholly exempt from tax under this Act or
under the Integrated Goods and Services Tax Act;
(b) an agriculturist, to the extent of supply of produce out of cultivation of land.
(2) The Government may, on the recommendations of the Council, by notification,
specify the category of persons who may be exempted from obtaining registration under this
Act.
24. Notwithstanding anything contained in sub-section (1) of section 22, the following Compulsory
categories of persons shall be required to be registered under this Act,–– registration in
certain cases.
(i) persons making any inter-State taxable supply;
(ii) casual taxable persons making taxable supply;
(iii) persons who are required to pay tax under reverse charge;
(iv) person who are required to pay tax under sub-section (5) of section 9;
(v) non-resident taxable persons making taxable supply;
(vi) persons who are required to deduct tax under section 51, whether or not
separately registered under this Act;
(vii) persons who make taxable supply of goods or services or both on behalf of
other taxable persons whether as an agent or otherwise;
(viii) Input Service Distributor, whether or not separately registered under this
Act;
(ix) persons who supply goods or services or both, other than supplies specified
under sub-section (5) of section 9, through such electronic commerce operator who is
required to collect tax at source under section 52;
(x) every electronic commerce operator;
(xi) every person supplying online information and data-base access or retrieval
services from a place outside India to a person in India, other than a registered
person; and
(xii) such other person or class of persons as may be notified by the Government
on the recommendations of the Council.
25. (1) Every person who is liable to be registered under section 22 or section 24 shall Procedure for
apply for registration in every such State or Union territory in which he is so liable within registration.30 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
thirty days from the date on which he becomes liable to registration, in such manner and
subject to such conditions as may be prescribed:
Provided that a casual taxable person or a non-resident taxable person shall apply for
registration at least five days prior to the commencement of business.
Explanation.—Every person who makes a supply from the territorial waters of India
shall obtain registration in the coastal State or Union territory where the nearest point of the
appropriate baseline is located.
(2) A person seeking registration under this Act shall be granted a single registration
in a State or Union territory:
Provided that a person having multiple business verticals in a State or Union territory
may be granted a separate registration for each business vertical, subject to such conditions
as may be prescribed.
(3) A person, though not liable to be registered under section 22 or section 24 may get
himself registered voluntarily, and all provisions of this Act, as are applicable to a registered
person, shall apply to such person.
(4) A person who has obtained or is required to obtain more than one registration,
whether in one State or Union territory or more than one State or Union territory shall, in
respect of each such registration, be treated as distinct persons for the purposes of this
Act.
(5) Where a person who has obtained or is required to obtain registration in a State or
Union territory in respect of an establishment, has an establishment in another State or
Union territory, then such establishments shall be treated as establishments of distinct
persons for the purposes of this Act.
(6) Every person shall have a Permanent Account Number issued under the Income-
tax Act, 1961 in order to be eligible for grant of registration: 43 of 1961.
Provided that a person required to deduct tax under section 51 may have, in lieu of a
Permanent Account Number, a Tax Deduction and Collection Account Number issued under
the said Act in order to be eligible for grant of registration.
(7) Notwithstanding anything contained in sub-section (6), a non-resident taxable
person may be granted registration under sub-section (1) on the basis of such other documents
as may be prescribed.
(8) Where a person who is liable to be registered under this Act fails to obtain
registration, the proper officer may, without prejudice to any action which may be taken
under this Act or under any other law for the time being in force, proceed to register such
person in such manner as may be prescribed.
(9) Notwithstanding anything contained in sub-section (1),––
(a) any specialised agency of the United Nations Organisation or any
Multilateral Financial Institution and Organisation notified under the United Nations
(Privileges and Immunities) Act, 1947, Consulate or Embassy of foreign countries; and 46 of 1947.
(b) any other person or class of persons, as may be notified by the Commissioner,
shall be granted a Unique Identity Number in such manner and for such purposes, including
refund of taxes on the notified supplies of goods or services or both received by them, as
may be prescribed.
(10) The registration or the Unique Identity Number shall be granted or rejected after
due verification in such manner and within such period as may be prescribed.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 31
(11) A certificate of registration shall be issued in such form and with effect from such
date as may be prescribed.
(12) A registration or a Unique Identity Number shall be deemed to have been granted
after the expiry of the period prescribed under sub-section (10), if no deficiency has been
communicated to the applicant within that period.
26. (1) The grant of registration or the Unique Identity Number under the State Goods Deemed
and Services Tax Act or the Union Territory Goods and Services Tax Act shall be deemed to registration.
be a grant of registration or the Unique Identity Number under this Act subject to the
condition that the application for registration or the Unique Identity Number has not been
rejected under this Act within the time specified in sub-section (10) of section 25.
(2) Notwithstanding anything contained in sub-section (10) of section 25, any rejection
of application for registration or the Unique Identity Number under the State Goods and
Services Tax Act or the Union Territory Goods and Services Tax Act shall be deemed to be a
rejection of application for registration under this Act.
27. (1) The certificate of registration issued to a casual taxable person or a Special
non-resident taxable person shall be valid for the period specified in the application for provisions
relating to
registration or ninety days from the effective date of registration, whichever is earlier and
casual taxable
such person shall make taxable supplies only after the issuance of the certificate of person and
registration: non-resident
taxable
person.
Provided that the proper officer may, on sufficient cause being shown by the said
taxable person, extend the said period of ninety days by a further period not exceeding
ninety days.
(2) A casual taxable person or a non-resident taxable person shall, at the time of
submission of application for registration under sub-section (1) of section 25, make an
advance deposit of tax in an amount equivalent to the estimated tax liability of such person
for the period for which the registration is sought:
Provided that where any extension of time is sought under sub-section (1), such
taxable person shall deposit an additional amount of tax equivalent to the estimated tax
liability of such person for the period for which the extension is sought.
(3) The amount deposited under sub-section (2) shall be credited to the electronic
cash ledger of such person and shall be utilised in the manner provided under
section 49.
28. (1) Every registered person and a person to whom a Unique Identity Number has Amendment
been assigned shall inform the proper officer of any changes in the information furnished at of
registration.
the time of registration or subsequent thereto, in such form and manner and within such
period as may be prescribed.
(2) The proper officer may, on the basis of information furnished under sub-section (1)
or as ascertained by him, approve or reject amendments in the registration particulars in such
manner and within such period as may be prescribed:
Provided that approval of the proper officer shall not be required in respect of amendment
of such particulars as may be prescribed:
Provided further that the proper officer shall not reject the application for amendment
in the registration particulars without giving the person an opportunity of being heard.
(3) Any rejection or approval of amendments under the State Goods and Services Tax
Act or the Union Territory Goods and Services Tax Act, as the case may be, shall be deemed
to be a rejection or approval under this Act.
29. (1) The proper officer may, either on his own motion or on an application filed by Cancellation
the registered person or by his legal heirs, in case of death of such person, cancel the of
registration.32 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
registration, in such manner and within such period as may be prescribed, having regard to
the circumstances where,––
(a) the business has been discontinued, transferred fully for any reason including
death of the proprietor, amalgamated with other legal entity, demerged or otherwise
disposed of; or
(b) there is any change in the constitution of the business; or
(c) the taxable person, other than the person registered under sub-section (3) of
section 25, is no longer liable to be registered under section 22 or section 24.
(2) The proper officer may cancel the registration of a person from such date, including
any retrospective date, as he may deem fit, where,––
(a) a registered person has contravened such provisions of the Act or the rules
made thereunder as may be prescribed; or
(b) a person paying tax under section 10 has not furnished returns for three
consecutive tax periods; or
(c) any registered person, other than a person specified in clause (b), has not
furnished returns for a continuous period of six months; or
(d) any person who has taken voluntary registration under sub-section (3) of
section 25 has not commenced business within six months from the date of
registration; or
(e) registration has been obtained by means of fraud, wilful misstatement or
suppression of facts:
Provided that the proper officer shall not cancel the registration without giving
the person an opportunity of being heard.
(3) The cancellation of registration under this section shall not affect the liability of the
person to pay tax and other dues under this Act or to discharge any obligation under this Act
or the rules made thereunder for any period prior to the date of cancellation whether or not
such tax and other dues are determined before or after the date of cancellation.
(4) The cancellation of registration under the State Goods and Services Tax Act or the
Union Territory Goods and Services Tax Act, as the case may be, shall be deemed to be a
cancellation of registration under this Act.
(5) Every registered person whose registration is cancelled shall pay an amount, by
way of debit in the electronic credit ledger or electronic cash ledger, equivalent to the credit
of input tax in respect of inputs held in stock and inputs contained in semi-finished or
finished goods held in stock or capital goods or plant and machinery on the day immediately
preceding the date of such cancellation or the output tax payable on such goods, whichever
is higher, calculated in such manner as may be prescribed:
Provided that in case of capital goods or plant and machinery, the taxable person shall
pay an amount equal to the input tax credit taken on the said capital goods or plant and
machinery, reduced by such percentage points as may be prescribed or the tax on the
transaction value of such capital goods or plant and machinery under section 15, whichever
is higher.
(6) The amount payable under sub-section (5) shall be calculated in such manner as
may be prescribed.
Revocation 30. (1) Subject to such conditions as may be prescribed, any registered person, whose
of registration is cancelled by the proper officer on his own motion, may apply to such officer
cancellation for revocation of cancellation of the registration in the prescribed manner within thirty days
of
from the date of service of the cancellation order.
registration.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 33
(2) The proper officer may, in such manner and within such period as may be prescribed,
by order, either revoke cancellation of the registration or reject the application:
Provided that the application for revocation of cancellation of registration shall not be
rejected unless the applicant has been given an opportunity of being heard.
(3) The revocation of cancellation of registration under the State Goods and Services
Tax Act or the Union Territory Goods and Services Tax Act, as the case may be, shall be
deemed to be a revocation of cancellation of registration under this Act.
CHAPTER VII
TAX INVOICE, CREDIT AND DEBIT NOTES
31. (1) A registered person supplying taxable goods shall, before or at the time of,— Tax invoice.
(a) removal of goods for supply to the recipient, where the supply involves
movement of goods; or
(b) delivery of goods or making available thereof to the recipient, in any other
case,
issue a tax invoice showing the description, quantity and value of goods, the tax charged
thereon and such other particulars as may be prescribed:
Provided that the Government may, on the recommendations of the Council, by
notification, specify the categories of goods or supplies in respect of which a tax invoice
shall be issued, within such time and in such manner as may be prescribed.
(2) A registered person supplying taxable services shall, before or after the provision
of service but within a prescribed period, issue a tax invoice, showing the description, value,
tax charged thereon and such other particulars as may be prescribed:
Provided that the Government may, on the recommendations of the Council, by
notification and subject to such conditions as may be mentioned therein, specify the categories
of services in respect of which––
(a) any other document issued in relation to the supply shall be deemed to be a
tax invoice; or
(b) tax invoice may not be issued.
(3) Notwithstanding anything contained in sub-sections (1) and (2)––
(a) a registered person may, within one month from the date of issuance of
certificate of registration and in such manner as may be prescribed, issue a revised
invoice against the invoice already issued during the period beginning with the effective
date of registration till the date of issuance of certificate of registration to him;
(b) a registered person may not issue a tax invoice if the value of the goods or
services or both supplied is less than two hundred rupees subject to such conditions
and in such manner as may be prescribed;
(c) a registered person supplying exempted goods or services or both or paying
tax under the provisions of section 10 shall issue, instead of a tax invoice, a bill of
supply containing such particulars and in such manner as may be prescribed:
Provided that the registered person may not issue a bill of supply if the value of
the goods or services or both supplied is less than two hundred rupees subject to
such conditions and in such manner as may be prescribed;
(d) a registered person shall, on receipt of advance payment with respect to any
supply of goods or services or both, issue a receipt voucher or any other document,
containing such particulars as may be prescribed, evidencing receipt of such payment;34 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(e) where, on receipt of advance payment with respect to any supply of goods or
services or both the registered person issues a receipt voucher, but subsequently no
supply is made and no tax invoice is issued in pursuance thereof, the said registered
person may issue to the person who had made the payment, a refund voucher against
such payment;
(f) a registered person who is liable to pay tax under sub-section (3) or
sub-section (4) of section 9 shall issue an invoice in respect of goods or services or
both received by him from the supplier who is not registered on the date of receipt of
goods or services or both;
(g) a registered person who is liable to pay tax under sub-section (3) or
sub-section (4) of section 9 shall issue a payment voucher at the time of making
payment to the supplier.
(4) In case of continuous supply of goods, where successive statements of accounts
or successive payments are involved, the invoice shall be issued before or at the time each
such statement is issued or, as the case may be, each such payment is received.
(5) Subject to the provisions of clause (d) of sub-section (3), in case of continuous
supply of services,––
(a) where the due date of payment is ascertainable from the contract, the invoice
shall be issued on or before the due date of payment;
(b) where the due date of payment is not ascertainable from the contract, the
invoice shall be issued before or at the time when the supplier of service receives the
payment;
(c) where the payment is linked to the completion of an event, the invoice shall
be issued on or before the date of completion of that event.
(6) In a case where the supply of services ceases under a contract before the completion
of the supply, the invoice shall be issued at the time when the supply ceases and such
invoice shall be issued to the extent of the supply made before such cessation.
(7) Notwithstanding anything contained in sub-section (1), where the goods being
sent or taken on approval for sale or return are removed before the supply takes place, the
invoice shall be issued before or at the time of supply or six months from the date of removal,
whichever is earlier.
Explanation.––For the purposes of this section, the expression “tax invoice” shall
include any revised invoice issued by the supplier in respect of a supply made earlier.
Prohibition of 32. (1) A person who is not a registered person shall not collect in respect of any
unauthorised supply of goods or services or both any amount by way of tax under this Act.
collection of
tax. (2) No registered person shall collect tax except in accordance with the provisions of
this Act or the rules made thereunder.
Amount of 33. Notwithstanding anything contained in this Act or any other law for the time being
tax to be in force, where any supply is made for a consideration, every person who is liable to pay tax
indicated in
for such supply shall prominently indicate in all documents relating to assessment, tax
tax invoice
invoice and other like documents, the amount of tax which shall form part of the price at
and other
documents. which such supply is made.
Credit and debit 34. (1) Where a tax invoice has been issued for supply of any goods or services or
notes. both and the taxable value or tax charged in that tax invoice is found to exceed the taxable
value or tax payable in respect of such supply, or where the goods supplied are returned by
the recipient, or where goods or services or both supplied are found to be deficient, the
registered person, who has supplied such goods or services or both, may issue to the
recipient a credit note containing such particulars as may be prescribed.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 35
(2) Any registered person who issues a credit note in relation to a supply of goods or
services or both shall declare the details of such credit note in the return for the month during
which such credit note has been issued but not later than September following the end of the
financial year in which such supply was made, or the date of furnishing of the relevant
annual return, whichever is earlier, and the tax liability shall be adjusted in such manner as
may be prescribed:
Provided that no reduction in output tax liability of the supplier shall be permitted, if
the incidence of tax and interest on such supply has been passed on to any other person.
(3) Where a tax invoice has been issued for supply of any goods or services or both
and the taxable value or tax charged in that tax invoice is found to be less than the taxable
value or tax payable in respect of such supply, the registered person, who has supplied such
goods or services or both, shall issue to the recipient a debit note containing such particulars
as may be prescribed.
(4) Any registered person who issues a debit note in relation to a supply of goods or
services or both shall declare the details of such debit note in the return for the month during
which such debit note has been issued and the tax liability shall be adjusted in such manner
as may be prescribed.
Explanation.––For the purposes of this Act, the expression “debit note” shall include
a supplementary invoice.
CHAPTER VIII
ACCOUNTS AND RECORDS
35. (1) Every registered person shall keep and maintain, at his principal place of business, Accounts and
as mentioned in the certificate of registration, a true and correct account of— other records.
(a) production or manufacture of goods;
(b) inward and outward supply of goods or services or both;
(c) stock of goods;
(d) input tax credit availed;
(e) output tax payable and paid; and
(f) such other particulars as may be prescribed:
Provided that where more than one place of business is specified in the certificate of
registration, the accounts relating to each place of business shall be kept at such places of
business:
Provided further that the registered person may keep and maintain such accounts and
other particulars in electronic form in such manner as may be prescribed.
(2) Every owner or operator of warehouse or godown or any other place used for
storage of goods and every transporter, irrespective of whether he is a registered person or
not, shall maintain records of the consigner, consignee and other relevant details of the
goods in such manner as may be prescribed.
(3) The Commissioner may notify a class of taxable persons to maintain additional
accounts or documents for such purpose as may be specified therein.
(4) Where the Commissioner considers that any class of taxable persons is not in a
position to keep and maintain accounts in accordance with the provisions of this section, he
may, for reasons to be recorded in writing, permit such class of taxable persons to maintain
accounts in such manner as may be prescribed.
(5) Every registered person whose turnover during a financial year exceeds the
prescribed limit shall get his accounts audited by a chartered accountant or a cost accountant36 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
and shall submit a copy of the audited annual accounts, the reconciliation statement under
sub-section (2) of section 44 and such other documents in such form and manner as may be
prescribed.
(6) Subject to the provisions of clause (h) of sub-section (5) of section 17, where
the registered person fails to account for the goods or services or both in accordance
with the provisions of sub-section (1), the proper officer shall determine the amount of
tax payable on the goods or services or both that are not accounted for, as if such goods
or services or both had been supplied by such person and the provisions of section 73
or section 74, as the case may be, shall, mutatis mutandis, apply for determination of
such tax.
Period of 36. Every registered person required to keep and maintain books of account or other
retention of records in accordance with the provisions of sub-section (1) of section 35 shall retain them
accounts.
until the expiry of seventy-two months from the due date of furnishing of annual return for
the year pertaining to such accounts and records:
Provided that a registered person, who is a party to an appeal or revision or any other
proceedings before any Appellate Authority or Revisional Authority or Appellate Tribunal
or court, whether filed by him or by the Commissioner, or is under investigation for an
offence under Chapter XIX, shall retain the books of account and other records pertaining to
the subject-matter of such appeal or revision or proceedings or investigation for a period of
one year after final disposal of such appeal or revision or proceedings or investigation, or for
the period specified above, whichever is later.
CHAPTER IX
RETURNS
Furnishing 37. (1) Every registered person, other than an Input Service Distributor, a non-resident
details of taxable person and a person paying tax under the provisions of section 10 or section 51 or
outward
section 52, shall furnish, electronically, in such form and manner as may be prescribed, the
supplies.
details of outward supplies of goods or services or both effected during a tax period on or
before the tenth day of the month succeeding the said tax period and such details shall be
communicated to the recipient of the said supplies within such time and in such manner as
may be prescribed:
Provided that the registered person shall not be allowed to furnish the details of
outward supplies during the period from the eleventh day to the fifteenth day of the month
succeeding the tax period:
Provided further that the Commissioner may, for reasons to be recorded in writing, by
notification, extend the time limit for furnishing such details for such class of taxable persons
as may be specified therein:
Provided also that any extension of time limit notified by the Commissioner of State
tax or Commissioner of Union territory tax shall be deemed to be notified by the
Commissioner.
(2) Every registered person who has been communicated the details under
sub-section (3) of section 38 or the details pertaining to inward supplies of Input Service
Distributor under sub-section (4) of section 38, shall either accept or reject the details so
communicated, on or before the seventeenth day, but not before the fifteenth day, of the
month succeeding the tax period and the details furnished by him under sub-section (1) shall
stand amended accordingly.
(3) Any registered person, who has furnished the details under sub-section (1) for
any tax period and which have remained unmatched under section 42 or section 43, shall,
upon discovery of any error or omission therein, rectify such error or omission in such
manner as may be prescribed, and shall pay the tax and interest, if any, in case there is aSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 37
short payment of tax on account of such error or omission, in the return to be furnished for
such tax period:
Provided that no rectification of error or omission in respect of the details furnished
under sub-section (1) shall be allowed after furnishing of the return under section 39 for the
month of September following the end of the financial year to which such details pertain, or
furnishing of the relevant annual return, whichever is earlier.
Explanation.––For the purposes of this Chapter, the expression “details of outward
supplies” shall include details of invoices, debit notes, credit notes and revised invoices
issued in relation to outward supplies made during any tax period.
38. (1) Every registered person, other than an Input Service Distributor or a Furnishing
non-resident taxable person or a person paying tax under the provisions of section 10 or details of
section 51 or section 52, shall verify, validate, modify or delete, if required, the details inward
supplies.
relating to outward supplies and credit or debit notes communicated under sub-section (1)
of section 37 to prepare the details of his inward supplies and credit or debit notes and may
include therein, the details of inward supplies and credit or debit notes received by him in
respect of such supplies that have not been declared by the supplier under sub-section (1)
of section 37.
(2) Every registered person, other than an Input Service Distributor or a non-resident
taxable person or a person paying tax under the provisions of section 10 or section 51 or
section 52, shall furnish, electronically, the details of inward supplies of taxable goods or
services or both, including inward supplies of goods or services or both on which the tax is
payable on reverse charge basis under this Act and inward supplies of goods or services or
both taxable under the Integrated Goods and Services Tax Act or on which integrated goods
51 of 1975. and services tax is payable under section 3 of the Customs Tariff Act, 1975, and credit or debit
notes received in respect of such supplies during a tax period after the tenth day but on or
before the fifteenth day of the month succeeding the tax period in such form and manner as
may be prescribed:
Provided that the Commissioner may, for reasons to be recorded in writing, by
notification, extend the time limit for furnishing such details for such class of taxable persons
as may be specified therein:
Provided further that any extension of time limit notified by the Commissioner of State
tax or Commissioner of Union territory tax shall be deemed to be notified by the Commissioner.
(3) The details of supplies modified, deleted or included by the recipient and furnished
under sub-section (2) shall be communicated to the supplier concerned in such manner and
within such time as may be prescribed.
(4) The details of supplies modified, deleted or included by the recipient in the
return furnished under sub-section (2) or sub-section (4) of section 39 shall be
communicated to the supplier concerned in such manner and within such time as may be
prescribed.
(5) Any registered person, who has furnished the details under sub-section (2) for any
tax period and which have remained unmatched under section 42 or section 43, shall, upon
discovery of any error or omission therein, rectify such error or omission in the tax period
during which such error or omission is noticed in such manner as may be prescribed, and
shall pay the tax and interest, if any, in case there is a short payment of tax on account of such
error or omission, in the return to be furnished for such tax period:
Provided that no rectification of error or omission in respect of the details furnished
under sub-section (2) shall be allowed after furnishing of the return under section 39 for the
month of September following the end of the financial year to which such details pertain, or
furnishing of the relevant annual return, whichever is earlier.38 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Furnishing of 39. (1) Every registered person, other than an Input Service Distributor or a
returns. non-resident taxable person or a person paying tax under the provisions of section 10 or
section 51 or section 52 shall, for every calendar month or part thereof, furnish, in such form
and manner as may be prescribed, a return, electronically, of inward and outward supplies of
goods or services or both, input tax credit availed, tax payable, tax paid and such other
particulars as may be prescribed, on or before the twentieth day of the month succeeding
such calendar month or part thereof.
(2) A registered person paying tax under the provisions of section 10 shall, for each
quarter or part thereof, furnish, in such form and manner as may be prescribed, a return,
electronically, of turnover in the State or Union territory, inward supplies of goods or services
or both, tax payable and tax paid within eighteen days after the end of such quarter.
(3) Every registered person required to deduct tax at source under the provisions of
section 51 shall furnish, in such form and manner as may be prescribed, a return, electronically,
for the month in which such deductions have been made within ten days after the end of
such month.
(4) Every taxable person registered as an Input Service Distributor shall, for every
calendar month or part thereof, furnish, in such form and manner as may be prescribed, a
return, electronically, within thirteen days after the end of such month.
(5) Every registered non-resident taxable person shall, for every calendar month or
part thereof, furnish, in such form and manner as may be prescribed, a return, electronically,
within twenty days after the end of a calendar month or within seven days after the last day
of the period of registration specified under sub-section (1) of section 27, whichever is
earlier.
(6) The Commissioner may, for reasons to be recorded in writing, by notification,
extend the time limit for furnishing the returns under this section for such class of registered
persons as may be specified therein:
Provided that any extension of time limit notified by the Commissioner of State tax or
Union territory tax shall be deemed to be notified by the Commissioner.
(7) Every registered person, who is required to furnish a return under sub-section (1)
or sub-section (2) or sub-section (3) or sub-section (5), shall pay to the Government the tax
due as per such return not later than the last date on which he is required to furnish such
return.
(8) Every registered person who is required to furnish a return under sub-section (1) or
sub-section (2) shall furnish a return for every tax period whether or not any supplies of
goods or services or both have been made during such tax period.
(9) Subject to the provisions of sections 37 and 38, if any registered person
after furnishing a return under sub-section (1) or sub-section (2) or sub-section (3) or
sub-section (4) or sub-section (5) discovers any omission or incorrect particulars therein,
other than as a result of scrutiny, audit, inspection or enforcement activity by the tax authorities,
he shall rectify such omission or incorrect particulars in the return to be furnished for the
month or quarter during which such omission or incorrect particulars are noticed, subject to
payment of interest under this Act:
Provided that no such rectification of any omission or incorrect particulars shall be
allowed after the due date for furnishing of return for the month of September or second
quarter following the end of the financial year, or the actual date of furnishing of relevant
annual return, whichever is earlier.
(10) A registered person shall not be allowed to furnish a return for a tax period if the
return for any of the previous tax periods has not been furnished by him.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 39
40. Every registered person who has made outward supplies in the period between First return.
the date on which he became liable to registration till the date on which registration has
been granted shall declare the same in the first return furnished by him after grant of
registration.
41. (1) Every registered person shall, subject to such conditions and restrictions as Claim of
may be prescribed, be entitled to take the credit of eligible input tax, as self-assessed, in his input tax
credit and
return and such amount shall be credited on a provisional basis to his electronic credit
provisional
ledger. acceptance
thereof.
(2) The credit referred to in sub-section (1) shall be utilised only for payment of self-
assessed output tax as per the return referred to in the said sub-section.
42. (1) The details of every inward supply furnished by a registered person (hereafter Matching,
in this section referred to as the “recipient”) for a tax period shall, in such manner and within reversal and
reclaim of
such time as may be prescribed, be matched––
input tax
(a) with the corresponding details of outward supply furnished by the credit.
corresponding registered person (hereafter in this section referred to as the “supplier”)
in his valid return for the same tax period or any preceding tax period;
(b) with the integrated goods and services tax paid under section 3 of the Customs
51 of 1975. Tariff Act, 1975 in respect of goods imported by him; and
(c) for duplication of claims of input tax credit.
(2) The claim of input tax credit in respect of invoices or debit notes relating to inward
supply that match with the details of corresponding outward supply or with the integrated
51 of 1975. goods and services tax paid under section 3 of the Customs Tariff Act, 1975 in respect of
goods imported by him shall be finally accepted and such acceptance shall be communicated,
in such manner as may be prescribed, to the recipient.
(3) Where the input tax credit claimed by a recipient in respect of an inward supply is
in excess of the tax declared by the supplier for the same supply or the outward supply is not
declared by the supplier in his valid returns, the discrepancy shall be communicated to both
such persons in such manner as may be prescribed.
(4) The duplication of claims of input tax credit shall be communicated to the recipient
in such manner as may be prescribed.
(5) The amount in respect of which any discrepancy is communicated under
sub-section (3) and which is not rectified by the supplier in his valid return for the month in
which discrepancy is communicated shall be added to the output tax liability of the recipient,
in such manner as may be prescribed, in his return for the month succeeding the month in
which the discrepancy is communicated.
(6) The amount claimed as input tax credit that is found to be in excess on account of
duplication of claims shall be added to the output tax liability of the recipient in his return for
the month in which the duplication is communicated.
(7) The recipient shall be eligible to reduce, from his output tax liability, the amount
added under sub-section (5), if the supplier declares the details of the invoice or debit note
in his valid return within the time specified in sub-section (9) of section 39.
(8) A recipient in whose output tax liability any amount has been added under
sub-section (5) or sub-section (6), shall be liable to pay interest at the rate specified under
sub-section (1) of section 50 on the amount so added from the date of availing of credit till
the corresponding additions are made under the said sub-sections.
(9) Where any reduction in output tax liability is accepted under sub-section (7), the
interest paid under sub-section (8) shall be refunded to the recipient by crediting the amount
in the corresponding head of his electronic cash ledger in such manner as may be prescribed:40 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Provided that the amount of interest to be credited in any case shall not exceed the
amount of interest paid by the supplier.
(10) The amount reduced from the output tax liability in contravention of the
provisions of sub-section (7) shall be added to the output tax liability of the recipient in his
return for the month in which such contravention takes place and such recipient shall be
liable to pay interest on the amount so added at the rate specified in sub-section (3) of
section 50.
Matching, 43. (1) The details of every credit note relating to outward supply furnished by a
reversal and registered person (hereafter in this section referred to as the “supplier”) for a tax period shall,
reclaim of
in such manner and within such time as may be prescribed, be matched––
reduction in
output tax
(a) with the corresponding reduction in the claim for input tax credit by the
liability.
corresponding registered person (hereafter in this section referred to as the “recipient”)
in his valid return for the same tax period or any subsequent tax period; and
(b) for duplication of claims for reduction in output tax liability.
(2) The claim for reduction in output tax liability by the supplier that matches with the
corresponding reduction in the claim for input tax credit by the recipient shall be finally
accepted and communicated, in such manner as may be prescribed, to the supplier.
(3) Where the reduction of output tax liability in respect of outward supplies exceeds
the corresponding reduction in the claim for input tax credit or the corresponding credit note
is not declared by the recipient in his valid returns, the discrepancy shall be communicated
to both such persons in such manner as may be prescribed.
(4) The duplication of claims for reduction in output tax liability shall be communicated
to the supplier in such manner as may be prescribed.
(5) The amount in respect of which any discrepancy is communicated under
sub-section (3) and which is not rectified by the recipient in his valid return for the month in
which discrepancy is communicated shall be added to the output tax liability of the supplier,
in such manner as may be prescribed, in his return for the month succeeding the month in
which the discrepancy is communicated.
(6) The amount in respect of any reduction in output tax liability that is found to be on
account of duplication of claims shall be added to the output tax liability of the supplier in his
return for the month in which such duplication is communicated.
(7) The supplier shall be eligible to reduce, from his output tax liability, the amount
added under sub-section (5) if the recipient declares the details of the credit note in his valid
return within the time specified in sub-section (9) of section 39.
(8) A supplier in whose output tax liability any amount has been added under
sub-section (5) or sub-section (6), shall be liable to pay interest at the rate specified under
sub-section (1) of section 50 in respect of the amount so added from the date of such claim
for reduction in the output tax liability till the corresponding additions are made under the
said sub-sections.
(9) Where any reduction in output tax liability is accepted under sub-section (7), the
interest paid under sub-section (8) shall be refunded to the supplier by crediting the amount
in the corresponding head of his electronic cash ledger in such manner as may be prescribed:
Provided that the amount of interest to be credited in any case shall not exceed the
amount of interest paid by the recipient.
(10) The amount reduced from output tax liability in contravention of the provisions of
sub-section (7) shall be added to the output tax liability of the supplier in his return for the
month in which such contravention takes place and such supplier shall be liable to pay
interest on the amount so added at the rate specified in sub-section (3) of section 50.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 41
44. (1) Every registered person, other than an Input Service Distributor, a person Annual return.
paying tax under section 51 or section 52, a casual taxable person and a non-resident taxable
person, shall furnish an annual return for every financial year electronically in such form and
manner as may be prescribed on or before the thirty-first day of December following the end
of such financial year.
(2) Every registered person who is required to get his accounts audited in accordance
with the provisions of sub-section (5) of section 35 shall furnish, electronically, the annual
return under sub-section (1) along with a copy of the audited annual accounts and a
reconciliation statement, reconciling the value of supplies declared in the return furnished
for the financial year with the audited annual financial statement, and such other particulars
as may be prescribed.
45. Every registered person who is required to furnish a return under sub-section (1) Final return.
of section 39 and whose registration has been cancelled shall furnish a final return within
three months of the date of cancellation or date of order of cancellation, whichever is later, in
such form and manner as may be prescribed.
46. Where a registered person fails to furnish a return under section 39 or section 44 or Notice to
section 45, a notice shall be issued requiring him to furnish such return within fifteen days in return
defaulters.
such form and manner as may be prescribed.
47. (1) Any registered person who fails to furnish the details of outward or inward Levy of late
supplies required under section 37 or section 38 or returns required under section 39 or fee.
section 45 by the due date shall pay a late fee of one hundred rupees for every day
during which such failure continues subject to a maximum amount of five thousand
rupees.
(2) Any registered person who fails to furnish the return required under section 44 by
the due date shall be liable to pay a late fee of one hundred rupees for every day during which
such failure continues subject to a maximum of an amount calculated at a quarter per cent. of
his turnover in the State or Union territory.
48. (1) The manner of approval of goods and services tax practitioners, their eligibility Goods and
conditions, duties and obligations, manner of removal and other conditions relevant for their services tax
practitioners.
functioning shall be such as may be prescribed.
(2) A registered person may authorise an approved goods and services tax practitioner
to furnish the details of outward supplies under section 37, the details of inward supplies
under section 38 and the return under section 39 or section 44 or section 45 in such manner
as may be prescribed.
(3) Notwithstanding anything contained in sub-section (2), the responsibility for
correctness of any particulars furnished in the return or other details filed by the goods and
services tax practitioners shall continue to rest with the registered person on whose behalf
such return and details are furnished.
CHAPTER X
PAYMENT OF TAX
49. (1) Every deposit made towards tax, interest, penalty, fee or any other amount by a Payment of
person by internet banking or by using credit or debit cards or National Electronic Fund tax, interest,
penalty and
Transfer or Real Time Gross Settlement or by such other mode and subject to such conditions
other
and restrictions as may be prescribed, shall be credited to the electronic cash ledger of such
amounts.
person to be maintained in such manner as may be prescribed.
(2) The input tax credit as self-assessed in the return of a registered person shall be
credited to his electronic credit ledger, in accordance with section 41, to be maintained in
such manner as may be prescribed.42 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(3) The amount available in the electronic cash ledger may be used for making any
payment towards tax, interest, penalty, fees or any other amount payable under the provisions
of this Act or the rules made thereunder in such manner and subject to such conditions and
within such time as may be prescribed.
(4) The amount available in the electronic credit ledger may be used for making any
payment towards output tax under this Act or under the Integrated Goods and Services Tax
Act in such manner and subject to such conditions and within such time as may be prescribed.
(5) The amount of input tax credit available in the electronic credit ledger of the registered
person on account of––
(a) integrated tax shall first be utilised towards payment of integrated tax and the
amount remaining, if any, may be utilised towards the payment of central tax and State
tax, or as the case may be, Union territory tax, in that order;
(b) the central tax shall first be utilised towards payment of central tax and the
amount remaining, if any, may be utilised towards the payment of integrated tax;
(c) the State tax shall first be utilised towards payment of State tax and the
amount remaining, if any, may be utilised towards payment of integrated tax;
(d) the Union territory tax shall first be utilised towards payment of Union territory
tax and the amount remaining, if any, may be utilised towards payment of integrated tax;
(e) the central tax shall not be utilised towards payment of State tax or Union
territory tax; and
(f) the State tax or Union territory tax shall not be utilised towards payment of
central tax.
(6) The balance in the electronic cash ledger or electronic credit ledger after payment
of tax, interest, penalty, fee or any other amount payable under this Act or the rules made
thereunder may be refunded in accordance with the provisions of section 54.
(7) All liabilities of a taxable person under this Act shall be recorded and maintained in
an electronic liability register in such manner as may be prescribed.
(8) Every taxable person shall discharge his tax and other dues under this Act or the
rules made thereunder in the following order, namely:––
(a) self-assessed tax, and other dues related to returns of previous tax periods;
(b) self-assessed tax, and other dues related to the return of the current tax period;
(c) any other amount payable under this Act or the rules made thereunder
including the demand determined under section 73 or section 74.
(9) Every person who has paid the tax on goods or services or both under this Act
shall, unless the contrary is proved by him, be deemed to have passed on the full incidence
of such tax to the recipient of such goods or services or both.
Explanation.––For the purposes of this section,—
(a) the date of credit to the account of the Government in the authorised bank
shall be deemed to be the date of deposit in the electronic cash ledger;
(b) the expression,—
(i) “tax dues” means the tax payable under this Act and does not include
interest, fee and penalty; and
(ii) “other dues” means interest, penalty, fee or any other amount payable
under this Act or the rules made thereunder.
Interest on 50. (1) Every person who is liable to pay tax in accordance with the provisions of this
delayed Act or the rules made thereunder, but fails to pay the tax or any part thereof to the Government
payment of
within the period prescribed, shall for the period for which the tax or any part thereof remains
tax.
unpaid, pay, on his own, interest at such rate, not exceeding eighteen per cent., as may be
notified by the Government on the recommendations of the Council.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 43
(2) The interest under sub-section (1) shall be calculated, in such manner as may be
prescribed, from the day succeeding the day on which such tax was due to be paid.
(3) A taxable person who makes an undue or excess claim of input tax credit under
sub-section (10) of section 42 or undue or excess reduction in output tax liability under
sub-section (10) of section 43, shall pay interest on such undue or excess claim or on such
undue or excess reduction, as the case may be, at such rate not exceeding twenty-four
per cent., as may be notified by the Government on the recommendations of the Council.
51. (1) Notwithstanding anything to the contrary contained in this Act, the Government Tax deduction
may mandate,–– at source.
(a) a department or establishment of the Central Government or State
Government; or
(b) local authority; or
(c) Governmental agencies; or
(d) such persons or category of persons as may be notified by the Government
on the recommendations of the Council,
(hereafter in this section referred to as “the deductor”), to deduct tax at the rate of one
per cent. from the payment made or credited to the supplier (hereafter in this section referred
to as “the deductee”) of taxable goods or services or both, where the total value of such
supply, under a contract, exceeds two lakh and fifty thousand rupees:
Provided that no deduction shall be made if the location of the supplier and the place
of supply is in a State or Union territory which is different from the State or as the case may
be, Union territory of registration of the recipient.
Explanation.––For the purpose of deduction of tax specified above, the value of
supply shall be taken as the amount excluding the central tax, State tax, Union territory tax,
integrated tax and cess indicated in the invoice.
(2) The amount deducted as tax under this section shall be paid to the Government by
the deductor within ten days after the end of the month in which such deduction is made, in
such manner as may be prescribed.
(3) The deductor shall furnish to the deductee a certificate mentioning therein the
contract value, rate of deduction, amount deducted, amount paid to the Government and
such other particulars in such manner as may be prescribed.
(4) If any deductor fails to furnish to the deductee the certificate, after deducting the
tax at source, within five days of crediting the amount so deducted to the Government, the
deductor shall pay, by way of a late fee, a sum of one hundred rupees per day from the day
after the expiry of such five days period until the failure is rectified, subject to a maximum
amount of five thousand rupees.
(5) The deductee shall claim credit, in his electronic cash ledger, of the tax deducted
and reflected in the return of the deductor furnished under sub-section (3) of section 39, in
such manner as may be prescribed.
(6) If any deductor fails to pay to the Government the amount deducted as tax under
sub-section (1), he shall pay interest in accordance with the provisions of sub-section (1) of
section 50, in addition to the amount of tax deducted.
(7) The determination of the amount in default under this section shall be made in the
manner specified in section 73 or section 74.
(8) The refund to the deductor or the deductee arising on account of excess or erroneous
deduction shall be dealt with in accordance with the provisions of section 54:
Provided that no refund to the deductor shall be granted, if the amount deducted has
been credited to the electronic cash ledger of the deductee.44 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Collection of 52. (1) Notwithstanding anything to the contrary contained in this Act, every electronic
tax at source. commerce operator (hereafter in this section referred to as the “operator”), not being an
agent, shall collect an amount calculated at such rate not exceeding one per cent., as may be
notified by the Government on the recommendations of the Council, of the net value of
taxable supplies made through it by other suppliers where the consideration with respect to
such supplies is to be collected by the operator.
Explanation.––For the purposes of this sub-section, the expression “net value of
taxable supplies” shall mean the aggregate value of taxable supplies of goods or services or
both, other than services notified under sub-section (5) of section 9, made during any month
by all registered persons through the operator reduced by the aggregate value of taxable
supplies returned to the suppliers during the said month.
(2) The power to collect the amount specified in sub-section (1) shall be without
prejudice to any other mode of recovery from the operator.
(3) The amount collected under sub-section (1) shall be paid to the Government by the
operator within ten days after the end of the month in which such collection is made, in such
manner as may be prescribed.
(4) Every operator who collects the amount specified in sub-section (1) shall furnish a
statement, electronically, containing the details of outward supplies of goods or services or
both effected through it, including the supplies of goods or services or both returned through
it, and the amount collected under sub-section (1) during a month, in such form and manner
as may be prescribed, within ten days after the end of such month.
(5) Every operator who collects the amount specified in sub-section (1) shall furnish
an annual statement, electronically, containing the details of outward supplies of goods or
services or both effected through it, including the supplies of goods or services or both
returned through it, and the amount collected under the said sub-section during the financial
year, in such form and manner as may be prescribed, before the thirty first day of December
following the end of such financial year.
(6) If any operator after furnishing a statement under sub-section (4) discovers any
omission or incorrect particulars therein, other than as a result of scrutiny, audit, inspection
or enforcement activity by the tax authorities, he shall rectify such omission or incorrect
particulars in the statement to be furnished for the month during which such omission
or incorrect particulars are noticed, subject to payment of interest, as specified in
sub-section (1) of section 50:
Provided that no such rectification of any omission or incorrect particulars shall be
allowed after the due date for furnishing of statement for the month of September following
the end of the financial year or the actual date of furnishing of the relevant annual statement,
whichever is earlier.
(7) The supplier who has supplied the goods or services or both through the operator
shall claim credit, in his electronic cash ledger, of the amount collected and reflected in the
statement of the operator furnished under sub-section (4), in such manner as may be
prescribed.
(8) The details of supplies furnished by every operator under sub-section (4) shall be
matched with the corresponding details of outward supplies furnished by the concerned
supplier registered under this Act in such manner and within such time as may be prescribed.
(9) Where the details of outward supplies furnished by the operator under
sub-section (4) do not match with the corresponding details furnished by the supplier under
section 37, the discrepancy shall be communicated to both persons in such manner and
within such time as may be prescribed.
(10) The amount in respect of which any discrepancy is communicated under
sub-section (9) and which is not rectified by the supplier in his valid return or the operator inSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 45
his statement for the month in which discrepancy is communicated, shall be added to the
output tax liability of the said supplier, where the value of outward supplies furnished by the
operator is more than the value of outward supplies furnished by the supplier, in his return
for the month succeeding the month in which the discrepancy is communicated in such
manner as may be prescribed.
(11) The concerned supplier, in whose output tax liability any amount has been added
under sub-section (10), shall pay the tax payable in respect of such supply along with
interest, at the rate specified under sub-section (1) of section 50 on the amount so added
from the date such tax was due till the date of its payment.
(12) Any authority not below the rank of Deputy Commissioner may serve a notice,
either before or during the course of any proceedings under this Act, requiring the operator
to furnish such details relating to—
(a) supplies of goods or services or both effected through such operator during
any period; or
(b) stock of goods held by the suppliers making supplies through such operator
in the godowns or warehouses, by whatever name called, managed by such operator
and declared as additional places of business by such suppliers,
as may be specified in the notice.
(13) Every operator on whom a notice has been served under sub-section (12) shall
furnish the required information within fifteen working days of the date of service of such
notice.
(14) Any person who fails to furnish the information required by the notice served
under sub-section (12) shall, without prejudice to any action that may be taken under
section 122, be liable to a penalty which may extend to twenty-five thousand rupees.
Explanation.—For the purposes of this section, the expression “concerned supplier”
shall mean the supplier of goods or services or both making supplies through the operator.
53. On utilisation of input tax credit availed under this Act for payment of tax dues Transfer of
under the Integrated Goods and Services Tax Act in accordance with the provisions of input tax
credit.
sub-section (5) of section 49, as reflected in the valid return furnished under sub-section (1)
of section 39, the amount collected as central tax shall stand reduced by an amount equal to
such credit so utilised and the Central Government shall transfer an amount equal to the
amount so reduced from the central tax account to the integrated tax account in such manner
and within such time as may be prescribed.
CHAPTER XI
REFUNDS
54. (1) Any person claiming refund of any tax and interest, if any, paid on such tax or Refund of tax.
any other amount paid by him, may make an application before the expiry of two years from
the relevant date in such form and manner as may be prescribed:
Provided that a registered person, claiming refund of any balance in the electronic
cash ledger in accordance with the provisions of sub-section (6) of section 49, may claim
such refund in the return furnished under section 39 in such manner as may be prescribed.
(2) A specialised agency of the United Nations Organisation or any Multilateral Financial
Institution and Organisation notified under the United Nations (Privileges and Immunities)
46 of 1947. Act, 1947, Consulate or Embassy of foreign countries or any other person or class of persons,
as notified under section 55, entitled to a refund of tax paid by it on inward supplies of goods
or services or both, may make an application for such refund, in such form and manner as
may be prescribed, before the expiry of six months from the last day of the quarter in which
such supply was received.46 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(3) Subject to the provisions of sub-section (10), a registered person may claim refund
of any unutilised input tax credit at the end of any tax period:
Provided that no refund of unutilised input tax credit shall be allowed in cases other
than––
(i) zero rated supplies made without payment of tax;
(ii) where the credit has accumulated on account of rate of tax on inputs being
higher than the rate of tax on output supplies (other than nil rated or fully exempt
supplies), except supplies of goods or services or both as may be notified by the
Government on the recommendations of the Council:
Provided further that no refund of unutilised input tax credit shall be allowed in
cases where the goods exported out of India are subjected to export duty:
Provided also that no refund of input tax credit shall be allowed, if the supplier of
goods or services or both avails of drawback in respect of central tax or claims refund
of the integrated tax paid on such supplies.
(4) The application shall be accompanied by—
(a) such documentary evidence as may be prescribed to establish that a refund
is due to the applicant; and
(b) such documentary or other evidence (including the documents referred to in
section 33) as the applicant may furnish to establish that the amount of tax and interest,
if any, paid on such tax or any other amount paid in relation to which such refund is
claimed was collected from, or paid by, him and the incidence of such tax and interest
had not been passed on to any other person:
Provided that where the amount claimed as refund is less than two lakh rupees,
it shall not be necessary for the applicant to furnish any documentary and other
evidences but he may file a declaration, based on the documentary or other evidences
available with him, certifying that the incidence of such tax and interest had not been
passed on to any other person.
(5) If, on receipt of any such application, the proper officer is satisfied that the whole
or part of the amount claimed as refund is refundable, he may make an order accordingly and
the amount so determined shall be credited to the Fund referred to in section 57.
(6) Notwithstanding anything contained in sub-section (5), the proper officer may,
in the case of any claim for refund on account of zero-rated supply of goods or services or
both made by registered persons, other than such category of registered persons as may
be notified by the Government on the recommendations of the Council, refund on a
provisional basis, ninety per cent. of the total amount so claimed, excluding the amount of
input tax credit provisionally accepted, in such manner and subject to such conditions,
limitations and safeguards as may be prescribed and thereafter make an order under
sub-section (5) for final settlement of the refund claim after due verification of documents
furnished by the applicant.
(7) The proper officer shall issue the order under sub-section (5) within sixty days from
the date of receipt of application complete in all respects.
(8) Notwithstanding anything contained in sub-section (5), the refundable amount
shall, instead of being credited to the Fund, be paid to the applicant, if such amount is
relatable to—
(a) refund of tax paid on zero-rated supplies of goods or services or both or on
inputs or input services used in making such zero-rated supplies;
(b) refund of unutilised input tax credit under sub-section (3);SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 47
(c) refund of tax paid on a supply which is not provided, either wholly or partially,
and for which invoice has not been issued, or where a refund voucher has been issued;
(d) refund of tax in pursuance of section 77;
(e) the tax and interest, if any, or any other amount paid by the applicant, if he
had not passed on the incidence of such tax and interest to any other person; or
(f) the tax or interest borne by such other class of applicants as the Government
may, on the recommendations of the Council, by notification, specify.
(9) Notwithstanding anything to the contrary contained in any judgment, decree,
order or direction of the Appellate Tribunal or any court or in any other provisions of this Act
or the rules made thereunder or in any other law for the time being in force, no refund shall be
made except in accordance with the provisions of sub-section (8).
(10) Where any refund is due under sub-section (3) to a registered person who has
defaulted in furnishing any return or who is required to pay any tax, interest or penalty, which
has not been stayed by any court, Tribunal or Appellate Authority by the specified date, the
proper officer may—
(a) withhold payment of refund due until the said person has furnished the
return or paid the tax, interest or penalty, as the case may be;
(b) deduct from the refund due, any tax, interest, penalty, fee or any other amount
which the taxable person is liable to pay but which remains unpaid under this Act or
under the existing law.
Explanation.––For the purposes of this sub-section, the expression “specified date”
shall mean the last date for filing an appeal under this Act.
(11) Where an order giving rise to a refund is the subject matter of an appeal or further
proceedings or where any other proceedings under this Act is pending and the Commissioner
is of the opinion that grant of such refund is likely to adversely affect the revenue in the said
appeal or other proceedings on account of malfeasance or fraud committed, he may, after
giving the taxable person an opportunity of being heard, withhold the refund till such time as
he may determine.
(12) Where a refund is withheld under sub-section (11), the taxable person shall,
notwithstanding anything contained in section 56, be entitled to interest at such rate not
exceeding six per cent. as may be notified on the recommendations of the Council, if as a
result of the appeal or further proceedings he becomes entitled to refund.
(13) Notwithstanding anything to the contrary contained in this section, the amount
of advance tax deposited by a casual taxable person or a non-resident taxable person under
sub-section (2) of section 27, shall not be refunded unless such person has, in respect of the
entire period for which the certificate of registration granted to him had remained in force,
furnished all the returns required under section 39.
(14) Notwithstanding anything contained in this section, no refund under sub-section (5)
or sub-section (6) shall be paid to an applicant, if the amount is less than one thousand rupees.
Explanation.—For the purposes of this section,––
(1) “refund” includes refund of tax paid on zero-rated supplies of goods or
services or both or on inputs or input services used in making such zero-rated supplies,
or refund of tax on the supply of goods regarded as deemed exports, or refund of
unutilised input tax credit as provided under sub-section (3).
(2) “relevant date” means—
(a) in the case of goods exported out of India where a refund of tax paid is
available in respect of goods themselves or, as the case may be, the inputs or
input services used in such goods,––48 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(i) if the goods are exported by sea or air, the date on which the ship
or the aircraft in which such goods are loaded, leaves India; or
(ii) if the goods are exported by land, the date on which such goods
pass the frontier; or
(iii) if the goods are exported by post, the date of despatch of goods
by the Post Office concerned to a place outside India;
(b) in the case of supply of goods regarded as deemed exports where a
refund of tax paid is available in respect of the goods, the date on which the
return relating to such deemed exports is furnished;
(c) in the case of services exported out of India where a refund of tax paid
is available in respect of services themselves or, as the case may be, the inputs
or input services used in such services, the date of––
(i) receipt of payment in convertible foreign exchange, where the
supply of services had been completed prior to the receipt of such payment;
or
(ii) issue of invoice, where payment for the services had been received
in advance prior to the date of issue of the invoice;
(d) in case where the tax becomes refundable as a consequence of judgment,
decree, order or direction of the Appellate Authority, Appellate Tribunal or any
court, the date of communication of such judgment, decree, order or direction;
(e) in the case of refund of unutilised input tax credit under
sub-section (3), the end of the financial year in which such claim for refund
arises;
(f) in the case where tax is paid provisionally under this Act or the rules
made thereunder, the date of adjustment of tax after the final assessment thereof;
(g) in the case of a person, other than the supplier, the date of receipt of
goods or services or both by such person; and
(h) in any other case, the date of payment of tax.
Refund in 55. The Government may, on the recommendations of the Council, by notification,
certain cases. specify any specialised agency of the United Nations Organisation or any Multilateral Financial
Institution and Organisation notified under the United Nations (Privileges and Immunities)
Act, 1947, Consulate or Embassy of foreign countries and any other person or class of 46 of 1947.
persons as may be specified in this behalf, who shall, subject to such conditions and restrictions
as may be prescribed, be entitled to claim a refund of taxes paid on the notified supplies of
goods or services or both received by them.
56. If any tax ordered to be refunded under sub-section (5) of section 54 to any
Interest on
delayed applicant is not refunded within sixty days from the date of receipt of application under
refunds. sub-section (1) of that section, interest at such rate not exceeding six per cent. as may be
specified in the notification issued by the Government on the recommendations of the
Council shall be payable in respect of such refund from the date immediately after the expiry
of sixty days from the date of receipt of application under the said sub-section till the date of
refund of such tax:
Provided that where any claim of refund arises from an order passed by an adjudicating
authority or Appellate Authority or Appellate Tribunal or court which has attained finality
and the same is not refunded within sixty days from the date of receipt of application filed
consequent to such order, interest at such rate not exceeding nine per cent. as may be
notified by the Government on the recommendations of the Council shall be payable inSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 49
respect of such refund from the date immediately after the expiry of sixty days from the date
of receipt of application till the date of refund.
Explanation.––For the purposes of this section, where any order of refund is made by
an Appellate Authority, Appellate Tribunal or any court against an order of the proper
officer under sub-section (5) of section 54, the order passed by the Appellate Authority,
Appellate Tribunal or by the court shall be deemed to be an order passed under the said
sub-section (5).
57. The Government shall constitute a Fund, to be called the Consumer Welfare Fund Consumer
and there shall be credited to the Fund,— Welfare Fund.
(a) the amount referred to in sub-section (5) of section 54;
(b) any income from investment of the amount credited to the Fund; and
(c) such other monies received by it,
in such manner as may be prescribed.
58. (1) All sums credited to the Fund shall be utilised by the Government for the Utilisation of
welfare of the consumers in such manner as may be prescribed. Fund.
(2) The Government or the authority specified by it shall maintain proper and separate
account and other relevant records in relation to the Fund and prepare an annual statement
of accounts in such form as may be prescribed in consultation with the Comptroller and
Auditor-General of India.
CHAPTER XII
ASSESSMENT
59. Every registered person shall self assess the taxes payable under this Act and Self-
furnish a return for each tax period as specified under section 39. assessment.
60. (1) Subject to the provisions of sub-section (2), where the taxable person is unable Provisional
to determine the value of goods or services or both or determine the rate of tax applicable assessment.
thereto, he may request the proper officer in writing giving reasons for payment of tax on a
provisional basis and the proper officer shall pass an order, within a period not later than
ninety days from the date of receipt of such request, allowing payment of tax on provisional
basis at such rate or on such value as may be specified by him.
(2) The payment of tax on provisional basis may be allowed, if the taxable person
executes a bond in such form as may be prescribed, and with such surety or security as the
proper officer may deem fit, binding the taxable person for payment of the difference between
the amount of tax as may be finally assessed and the amount of tax provisionally assessed.
(3) The proper officer shall, within a period not exceeding six months from the date of
the communication of the order issued under sub-section (1), pass the final assessment
order after taking into account such information as may be required for finalizing the
assessment:
Provided that the period specified in this sub-section may, on sufficient cause being
shown and for reasons to be recorded in writing, be extended by the Joint Commissioner or
Additional Commissioner for a further period not exceeding six months and by the
Commissioner for such further period not exceeding four years.
(4) The registered person shall be liable to pay interest on any tax payable on the
supply of goods or services or both under provisional assessment but not paid on the due
date specified under sub-section (7) of section 39 or the rules made thereunder, at the rate
specified under sub-section (1) of section 50, from the first day after the due date of payment
of tax in respect of the said supply of goods or services or both till the date of actual50 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
payment, whether such amount is paid before or after the issuance of order for final
assessment.
(5) Where the registered person is entitled to a refund consequent to the order of final
assessment under sub-section (3), subject to the provisions of sub-section (8) of section 54,
interest shall be paid on such refund as provided in section 56.
Scrutiny of 61. (1) The proper officer may scrutinize the return and related particulars furnished by
returns.
the registered person to verify the correctness of the return and inform him of the discrepancies
noticed, if any, in such manner as may be prescribed and seek his explanation thereto.
(2) In case the explanation is found acceptable, the registered person shall be informed
accordingly and no further action shall be taken in this regard.
(3) In case no satisfactory explanation is furnished within a period of thirty days of
being informed by the proper officer or such further period as may be permitted by him or
where the registered person, after accepting the discrepancies, fails to take the corrective
measure in his return for the month in which the discrepancy is accepted, the proper officer
may initiate appropriate action including those under section 65 or section 66 or section 67,
or proceed to determine the tax and other dues under section 73 or section 74.
Assessment of 62. (1) Notwithstanding anything to the contrary contained in section 73 or section 74,
non-filers of where a registered person fails to furnish the return under section 39 or section 45, even after
returns. the service of a notice under section 46, the proper officer may proceed to assess the tax
liability of the said person to the best of his judgement taking into account all the relevant
material which is available or which he has gathered and issue an assessment order within a
period of five years from the date specified under section 44 for furnishing of the annual
return for the financial year to which the tax not paid relates.
(2) Where the registered person furnishes a valid return within thirty days of the
service of the assessment order under sub-section (1), the said assessment order shall be
deemed to have been withdrawn but the liability for payment of interest under sub-section (1)
of section 50 or for payment of late fee under section 47 shall continue.
Assessment of 63. Notwithstanding anything to the contrary contained in section 73 or section
unregistered 74, where a taxable person fails to obtain registration even though liable to do so or whose
persons.
registration has been cancelled under sub-section (2) of section 29 but who was liable to pay
tax, the proper officer may proceed to assess the tax liability of such taxable person to the
best of his judgment for the relevant tax periods and issue an assessment order within a
period of five years from the date specified under section 44 for furnishing of the annual
return for the financial year to which the tax not paid relates:
Provided that no such assessment order shall be passed without giving the person an
opportunity of being heard.
Summary 64. (1) The proper officer may, on any evidence showing a tax liability of a person
assessment in coming to his notice, with the previous permission of Additional Commissioner or
certain
Joint Commissioner, proceed to assess the tax liability of such person to protect the interest
special cases.
of revenue and issue an assessment order, if he has sufficient grounds to believe that any
delay in doing so may adversely affect the interest of revenue:
Provided that where the taxable person to whom the liability pertains is not ascertainable
and such liability pertains to supply of goods, the person in charge of such goods shall be
deemed to be the taxable person liable to be assessed and liable to pay tax and any other
amount due under this section.
(2) On an application made by the taxable person within thirty days from the date of
receipt of order passed under sub-section (1) or on his own motion, if the Additional
Commissioner or Joint Commissioner considers that such order is erroneous, he may withdraw
such order and follow the procedure laid down in section 73 or section 74.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 51
CHAPTER XIII
AUDIT
65. (1) The Commissioner or any officer authorised by him, by way of a general or a Audit by tax
specific order, may undertake audit of any registered person for such period, at such frequency authorities.
and in such manner as may be prescribed.
(2) The officers referred to in sub-section (1) may conduct audit at the place of business
of the registered person or in their office.
(3) The registered person shall be informed by way of a notice not less than fifteen
working days prior to the conduct of audit in such manner as may be prescribed.
(4) The audit under sub-section (1) shall be completed within a period of three months
from the date of commencement of the audit:
Provided that where the Commissioner is satisfied that audit in respect of such
registered person cannot be completed within three months, he may, for the reasons to be
recorded in writing, extend the period by a further period not exceeding six months.
Explanation.––For the purposes of this sub-section, the expression “commencement
of audit” shall mean the date on which the records and other documents, called for by the tax
authorities, are made available by the registered person or the actual institution of audit at
the place of business, whichever is later.
(5) During the course of audit, the authorised officer may require the registered
person,—
(i) to afford him the necessary facility to verify the books of account or other
documents as he may require;
(ii) to furnish such information as he may require and render assistance for
timely completion of the audit.
(6) On conclusion of audit, the proper officer shall, within thirty days, inform the
registered person, whose records are audited, about the findings, his rights and obligations
and the reasons for such findings.
(7) Where the audit conducted under sub-section (1) results in detection of tax not
paid or short paid or erroneously refunded, or input tax credit wrongly availed or utilised, the
proper officer may initiate action under section 73 or section 74.
66. (1) If at any stage of scrutiny, inquiry, investigation or any other proceedings Special audit.
before him, any officer not below the rank of Assistant Commissioner, having regard to the
nature and complexity of the case and the interest of revenue, is of the opinion that the value
has not been correctly declared or the credit availed is not within the normal limits, he may,
with the prior approval of the Commissioner, direct such registered person by a communication
in writing to get his records including books of account examined and audited by a chartered
accountant or a cost accountant as may be nominated by the Commissioner.
(2) The chartered accountant or cost accountant so nominated shall, within the period
of ninety days, submit a report of such audit duly signed and certified by him to the said
Assistant Commissioner mentioning therein such other particulars as may be specified:
Provided that the Assistant Commissioner may, on an application made to him in this
behalf by the registered person or the chartered accountant or cost accountant or for any
material and sufficient reason, extend the said period by a further period of ninety days.
(3) The provisions of sub-section (1) shall have effect notwithstanding that the
accounts of the registered person have been audited under any other provisions of this Act
or any other law for the time being in force.52 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(4) The registered person shall be given an opportunity of being heard in respect of
any material gathered on the basis of special audit under sub-section (1) which is proposed
to be used in any proceedings against him under this Act or the rules made thereunder.
(5) The expenses of the examination and audit of records under sub-section (1), including
the remuneration of such chartered accountant or cost accountant, shall be determined and
paid by the Commissioner and such determination shall be final.
(6) Where the special audit conducted under sub-section (1) results in detection of tax
not paid or short paid or erroneously refunded, or input tax credit wrongly availed or utilised,
the proper officer may initiate action under section 73 or section 74.
CHAPTER XIV
INSPECTION, SEARCH, SEIZURE AND ARREST
Power of
67. (1) Where the proper officer, not below the rank of Joint Commissioner, has reasons
inspection,
to believe that––
search and
seizure.
(a) a taxable person has suppressed any transaction relating to supply of goods
or services or both or the stock of goods in hand, or has claimed input tax credit in
excess of his entitlement under this Act or has indulged in contravention of any of the
provisions of this Act or the rules made thereunder to evade tax under this Act; or
(b) any person engaged in the business of transporting goods or an owner or
operator of a warehouse or a godown or any other place is keeping goods which have
escaped payment of tax or has kept his accounts or goods in such a manner as is likely
to cause evasion of tax payable under this Act,
he may authorise in writing any other officer of central tax to inspect any places of business
of the taxable person or the persons engaged in the business of transporting goods or the
owner or the operator of warehouse or godown or any other place.
(2) Where the proper officer, not below the rank of Joint Commissioner, either pursuant
to an inspection carried out under sub-section (1) or otherwise, has reasons to believe that
any goods liable to confiscation or any documents or books or things, which in his opinion
shall be useful for or relevant to any proceedings under this Act, are secreted in any place, he
may authorise in writing any other officer of central tax to search and seize or may himself
search and seize such goods, documents or books or things:
Provided that where it is not practicable to seize any such goods, the proper officer, or
any officer authorized by him, may serve on the owner or the custodian of the goods an order
that he shall not remove, part with, or otherwise deal with the goods except with the previous
permission of such officer:
Provided further that the documents or books or things so seized shall be retained by
such officer only for so long as may be necessary for their examination and for any inquiry or
proceedings under this Act.
(3) The documents, books or things referred to in sub-section (2) or any other
documents, books or things produced by a taxable person or any other person, which have
not been relied upon for the issue of notice under this Act or the rules made thereunder, shall
be returned to such person within a period not exceeding thirty days of the issue of the said
notice.
(4) The officer authorised under sub-section (2) shall have the power to seal or break
open the door of any premises or to break open any almirah, electronic devices, box, receptacle
in which any goods, accounts, registers or documents of the person are suspected to be
concealed, where access to such premises, almirah, electronic devices, box or receptacle is
denied.
(5) The person from whose custody any documents are seized under sub-section (2)
shall be entitled to make copies thereof or take extracts therefrom in the presence of anSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 53
authorised officer at such place and time as such officer may indicate in this behalf except
where making such copies or taking such extracts may, in the opinion of the proper officer,
prejudicially affect the investigation.
(6) The goods so seized under sub-section (2) shall be released, on a provisional
basis, upon execution of a bond and furnishing of a security, in such manner and of such
quantum, respectively, as may be prescribed or on payment of applicable tax, interest and
penalty payable, as the case may be.
(7) Where any goods are seized under sub-section (2) and no notice in respect thereof
is given within six months of the seizure of the goods, the goods shall be returned to the
person from whose possession they were seized:
Provided that the period of six months may, on sufficient cause being shown, be
extended by the proper officer for a further period not exceeding six months.
(8) The Government may, having regard to the perishable or hazardous nature of any
goods, depreciation in the value of the goods with the passage of time, constraints of
storage space for the goods or any other relevant considerations, by notification, specify
the goods or class of goods which shall, as soon as may be after its seizure under
sub-section (2), be disposed of by the proper officer in such manner as may be prescribed.
(9) Where any goods, being goods specified under sub-section (8), have been seized
by a proper officer, or any officer authorised by him under sub-section (2), he shall prepare
an inventory of such goods in such manner as may be prescribed.
2 of 1974. (10) The provisions of the Code of Criminal Procedure, 1973, relating to search and
seizure, shall, so far as may be, apply to search and seizure under this section subject to the
modification that sub-section (5) of section 165 of the said Code shall have effect as if for the
word “Magistrate”, wherever it occurs, the word “Commissioner” were substituted.
(11) Where the proper officer has reasons to believe that any person has evaded or is
attempting to evade the payment of any tax, he may, for reasons to be recorded in writing,
seize the accounts, registers or documents of such person produced before him and shall
grant a receipt for the same, and shall retain the same for so long as may be necessary in
connection with any proceedings under this Act or the rules made thereunder for prosecution.
(12) The Commissioner or an officer authorised by him may cause purchase of any
goods or services or both by any person authorised by him from the business premises of
any taxable person, to check the issue of tax invoices or bills of supply by such taxable
person, and on return of goods so purchased by such officer, such taxable person or any
person in charge of the business premises shall refund the amount so paid towards the
goods after cancelling any tax invoice or bill of supply issued earlier.
68. (1) The Government may require the person in charge of a conveyance carrying Inspection of
any consignment of goods of value exceeding such amount as may be specified to carry with goods in
movement.
him such documents and such devices as may be prescribed.
(2) The details of documents required to be carried under sub-section (1) shall be
validated in such manner as may be prescribed.
(3) Where any conveyance referred to in sub-section (1) is intercepted by the proper
officer at any place, he may require the person in charge of the said conveyance to produce
the documents prescribed under the said sub-section and devices for verification, and the
said person shall be liable to produce the documents and devices and also allow the inspection
of goods.
69. (1) Where the Commissioner has reasons to believe that a person has committed Power to
any offence specified in clause (a) or clause (b) or clause (c) or clause (d) of arrest.
sub-section (1) of section 132 which is punishable under clause (i) or (ii) of54 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
sub-section (1), or sub-section (2) of the said section, he may, by order, authorise any officer
of central tax to arrest such person.
(2) Where a person is arrested under sub-section (1) for an offence specified under
sub-section (5) of section 132, the officer authorised to arrest the person shall inform such
person of the grounds of arrest and produce him before a Magistrate within twenty-four hours.
(3) Subject to the provisions of the Code of Criminal Procedure, 1973,–– 2 of 1974.
(a) where a person is arrested under sub-section (1) for any offence specified
under sub-section (4) of section 132, he shall be admitted to bail or in default of bail,
forwarded to the custody of the Magistrate;
(b) in the case of a non-cognizable and bailable offence, the Deputy Commissioner
or the Assistant Commissioner shall, for the purpose of releasing an arrested person
on bail or otherwise, have the same powers and be subject to the same provisions as
an officer-in-charge of a police station.
Power to 70. (1) The proper officer under this Act shall have power to summon any person
summon whose attendance he considers necessary either to give evidence or to produce a document
persons to or any other thing in any inquiry in the same manner, as provided in the case of a civil court
give evidence
and produce under the provisions of the Code of Civil Procedure, 1908. 5 of 1908
documents.
(2) Every such inquiry referred to in sub-section (1) shall be deemed to be a “judicial
proceedings” within the meaning of section 193 and section 228 of the Indian Penal Code. 45 of 1860.
Access to 71. (1) Any officer under this Act, authorised by the proper officer not below the rank
business of Joint Commissioner, shall have access to any place of business of a registered person to
premises.
inspect books of account, documents, computers, computer programs, computer software
whether installed in a computer or otherwise and such other things as he may require and
which may be available at such place, for the purposes of carrying out any audit, scrutiny,
verification and checks as may be necessary to safeguard the interest of revenue.
(2) Every person in charge of place referred to in sub-section (1) shall, on demand,
make available to the officer authorised under sub-section (1) or the audit party deputed by
the proper officer or a cost accountant or chartered accountant nominated under
section 66—
(i) such records as prepared or maintained by the registered person and declared
to the proper officer in such manner as may be prescribed;
(ii) trial balance or its equivalent;
(iii) statements of annual financial accounts, duly audited, wherever required;
(iv) cost audit report, if any, under section 148 of the Companies Act, 2013; 18 of 2013.
(v) the income-tax audit report, if any, under section 44AB of the Income-tax
Act, 1961; and 43 of 1961.
(vi) any other relevant record,
for the scrutiny by the officer or audit party or the chartered accountant or cost accountant
within a period not exceeding fifteen working days from the day when such demand is made,
or such further period as may be allowed by the said officer or the audit party or the chartered
accountant or cost accountant.
Officers to 72. (1) All officers of Police, Railways, Customs, and those officers engaged in the
assist proper
collection of land revenue, including village officers, officers of State tax and officers of
officers.
Union territory tax shall assist the proper officers in the implementation of this Act.
(2) The Government may, by notification, empower and require any other class of
officers to assist the proper officers in the implementation of this Act when called upon to do
so by the Commissioner.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 55
CHAPTER XV
DEMANDS AND RECOVERY
73. (1) Where it appears to the proper officer that any tax has not been paid or short Determination
paid or erroneously refunded, or where input tax credit has been wrongly availed or utilised of tax not
paid or short
for any reason, other than the reason of fraud or any wilful-misstatement or suppression of
paid or
facts to evade tax, he shall serve notice on the person chargeable with tax which has not been
erroneously
so paid or which has been so short paid or to whom the refund has erroneously been made, refunded or
or who has wrongly availed or utilised input tax credit, requiring him to show cause as to why input tax
credit wrongly
he should not pay the amount specified in the notice along with interest payable thereon
availed or
under section 50 and a penalty leviable under the provisions of this Act or the rules made
utilised for
thereunder. any reason
other than
(2) The proper officer shall issue the notice under sub-section (1) at least three months fraud or any
prior to the time limit specified in sub-section (10) for issuance of order. wilful-
misstatement
(3) Where a notice has been issued for any period under sub-section (1), the proper or suppression
officer may serve a statement, containing the details of tax not paid or short paid or erroneously of facts.
refunded or input tax credit wrongly availed or utilised for such periods other than those
covered under sub-section (1), on the person chargeable with tax.
(4) The service of such statement shall be deemed to be service of notice on such
person under sub-section (1), subject to the condition that the grounds relied upon for such
tax periods other than those covered under sub-section (1) are the same as are mentioned in
the earlier notice.
(5) The person chargeable with tax may, before service of notice under sub-section (1)
or, as the case may be, the statement under sub-section (3), pay the amount of tax along with
interest payable thereon under section 50 on the basis of his own ascertainment of such tax
or the tax as ascertained by the proper officer and inform the proper officer in writing of such
payment.
(6) The proper officer, on receipt of such information, shall not serve any notice under
sub-section (1) or, as the case may be, the statement under sub-section (3), in respect of the
tax so paid or any penalty payable under the provisions of this Act or the rules made
thereunder.
(7) Where the proper officer is of the opinion that the amount paid under
sub-section (5) falls short of the amount actually payable, he shall proceed to issue the
notice as provided for in sub-section (1) in respect of such amount which falls short of the
amount actually payable.
(8) Where any person chargeable with tax under sub-section (1) or sub-section (3)
pays the said tax along with interest payable under section 50 within thirty days of issue of
show cause notice, no penalty shall be payable and all proceedings in respect of the said
notice shall be deemed to be concluded.
(9) The proper officer shall, after considering the representation, if any, made by
person chargeable with tax, determine the amount of tax, interest and a penalty equivalent to
ten per cent. of tax or ten thousand rupees, whichever is higher, due from such person and
issue an order.
(10) The proper officer shall issue the order under sub-section (9) within three years
from the due date for furnishing of annual return for the financial year to which the tax not
paid or short paid or input tax credit wrongly availed or utilised relates to or within three
years from the date of erroneous refund.
(11) Notwithstanding anything contained in sub-section (6) or sub-section (8), penalty
under sub-section (9) shall be payable where any amount of self-assessed tax or any amount
collected as tax has not been paid within a period of thirty days from the due date of payment
of such tax.56 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Determination 74. (1) Where it appears to the proper officer that any tax has not been paid or short
of tax not paid or erroneously refunded or where input tax credit has been wrongly availed or utilised
paid or short
by reason of fraud, or any wilful-misstatement or suppression of facts to evade tax, he shall
paid or
erroneously serve notice on the person chargeable with tax which has not been so paid or which has been
refunded or so short paid or to whom the refund has erroneously been made, or who has wrongly availed
input tax or utilised input tax credit, requiring him to show cause as to why he should not pay the
credit wrongly
amount specified in the notice along with interest payable thereon under section 50 and a
availed or
utilised by penalty equivalent to the tax specified in the notice.
reason of
(2) The proper officer shall issue the notice under sub-section (1) at least six months
fraud or any
wilful- prior to the time limit specified in sub-section (10) for issuance of order.
misstatement
or suppression (3) Where a notice has been issued for any period under sub-section (1), the proper
of facts. officer may serve a statement, containing the details of tax not paid or short paid or erroneously
refunded or input tax credit wrongly availed or utilised for such periods other than those
covered under sub-section (1), on the person chargeable with tax.
(4) The service of statement under sub-section (3) shall be deemed to be service of
notice under sub-section (1) of section 73, subject to the condition that the grounds relied
upon in the said statement, except the ground of fraud, or any wilful-misstatement or
suppression of facts to evade tax, for periods other than those covered under
sub-section (1) are the same as are mentioned in the earlier notice.
(5) The person chargeable with tax may, before service of notice under
sub-section (1), pay the amount of tax along with interest payable under section 50 and a
penalty equivalent to fifteen per cent. of such tax on the basis of his own ascertainment of
such tax or the tax as ascertained by the proper officer and inform the proper officer in writing
of such payment.
(6) The proper officer, on receipt of such information, shall not serve any notice under
sub-section (1), in respect of the tax so paid or any penalty payable under the provisions of
this Act or the rules made thereunder.
(7) Where the proper officer is of the opinion that the amount paid under
sub-section (5) falls short of the amount actually payable, he shall proceed to issue the
notice as provided for in sub-section (1) in respect of such amount which falls short of the
amount actually payable.
(8) Where any person chargeable with tax under sub-section (1) pays the said tax
along with interest payable under section 50 and a penalty equivalent to twenty-five per cent.
of such tax within thirty days of issue of the notice, all proceedings in respect of the said
notice shall be deemed to be concluded.
(9) The proper officer shall, after considering the representation, if any, made by the
person chargeable with tax, determine the amount of tax, interest and penalty due from such
person and issue an order.
(10) The proper officer shall issue the order under sub-section (9) within a period of
five years from the due date for furnishing of annual return for the financial year to which the
tax not paid or short paid or input tax credit wrongly availed or utilised relates to or within five
years from the date of erroneous refund.
(11) Where any person served with an order issued under sub-section (9) pays the tax
along with interest payable thereon under section 50 and a penalty equivalent to fifty
per cent. of such tax within thirty days of communication of the order, all proceedings in
respect of the said notice shall be deemed to be concluded.
Explanation 1.— For the purposes of section 73 and this section,—
(i) the expression “all proceedings in respect of the said notice” shall not
include proceedings under section 132;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 57
(ii) where the notice under the same proceedings is issued to the main
person liable to pay tax and some other persons, and such proceedings against
the main person have been concluded under section 73 or section 74, the
proceedings against all the persons liable to pay penalty under sections 122,
125, 129 and 130 are deemed to be concluded.
Explanation 2.––For the purposes of this Act, the expression “suppression”
shall mean non-declaration of facts or information which a taxable person is required to
declare in the return, statement, report or any other document furnished under this Act
or the rules made thereunder, or failure to furnish any information on being asked for,
in writing, by the proper officer.
75. (1) Where the service of notice or issuance of order is stayed by an order of a court General
or Appellate Tribunal, the period of such stay shall be excluded in computing the period provisions
specified in sub-sections (2) and (10) of section 73 or sub-sections (2) and (10) of section 74, relating to
determination
as the case may be.
of tax.
(2) Where any Appellate Authority or Appellate Tribunal or court concludes that the
notice issued under sub-section (1) of section 74 is not sustainable for the reason that the
charges of fraud or any wilful-misstatement or suppression of facts to evade tax has not been
established against the person to whom the notice was issued, the proper officer shall
determine the tax payable by such person, deeming as if the notice were issued under
sub-section (1) of section 73.
(3) Where any order is required to be issued in pursuance of the direction of the
Appellate Authority or Appellate Tribunal or a court, such order shall be issued within two
years from the date of communication of the said direction.
(4) An opportunity of hearing shall be granted where a request is received in writing
from the person chargeable with tax or penalty, or where any adverse decision is contemplated
against such person.
(5) The proper officer shall, if sufficient cause is shown by the person chargeable with
tax, grant time to the said person and adjourn the hearing for reasons to be recorded in
writing:
Provided that no such adjournment shall be granted for more than three times to a
person during the proceedings.
(6) The proper officer, in his order, shall set out the relevant facts and the basis of his
decision.
(7) The amount of tax, interest and penalty demanded in the order shall not be in excess
of the amount specified in the notice and no demand shall be confirmed on the grounds other
than the grounds specified in the notice.
(8) Where the Appellate Authority or Appellate Tribunal or court modifies the amount
of tax determined by the proper officer, the amount of interest and penalty shall stand
modified accordingly, taking into account the amount of tax so modified.
(9) The interest on the tax short paid or not paid shall be payable whether or not
specified in the order determining the tax liability.
(10) The adjudication proceedings shall be deemed to be concluded, if the order is not
issued within three years as provided for in sub-section (10) of section 73 or within five
years as provided for in sub-section (10) of section 74.
(11) An issue on which the Appellate Authority or the Appellate Tribunal or the High
Court has given its decision which is prejudicial to the interest of revenue in some other
proceedings and an appeal to the Appellate Tribunal or the High Court or the Supreme
Court against such decision of the Appellate Authority or the Appellate Tribunal or the
High Court is pending, the period spent between the date of the decision of the Appellate58 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Authority and that of the Appellate Tribunal or the date of decision of the Appellate Tribunal
and that of the High Court or the date of the decision of the High Court and that of the
Supreme Court shall be excluded in computing the period referred to in sub-section (10) of
section 73 or sub-section (10) of section 74 where proceedings are initiated by way of issue
of a show cause notice under the said sections.
(12) Notwithstanding anything contained in section 73 or section 74, where any amount
of self-assessed tax in accordance with a return furnished under section 39 remains unpaid,
either wholly or partly, or any amount of interest payable on such tax remains unpaid, the
same shall be recovered under the provisions of section 79.
(13) Where any penalty is imposed under section 73 or section 74, no penalty for the
same act or omission shall be imposed on the same person under any other provision of this
Act.
Tax collected 76. (1) Notwithstanding anything to the contrary contained in any order or direction
but not paid to of any Appellate Authority or Appellate Tribunal or court or in any other provisions of this
Government.
Act or the rules made thereunder or any other law for the time being in force, every person
who has collected from any other person any amount as representing the tax under this Act,
and has not paid the said amount to the Government, shall forthwith pay the said amount to
the Government, irrespective of whether the supplies in respect of which such amount was
collected are taxable or not.
(2) Where any amount is required to be paid to the Government under
sub-section (1), and which has not been so paid, the proper officer may serve on the person
liable to pay such amount a notice requiring him to show cause as to why the said amount as
specified in the notice, should not be paid by him to the Government and why a penalty
equivalent to the amount specified in the notice should not be imposed on him under the
provisions of this Act.
(3) The proper officer shall, after considering the representation, if any, made by the
person on whom the notice is served under sub-section (2), determine the amount due from
such person and thereupon such person shall pay the amount so determined.
(4) The person referred to in sub-section (1) shall in addition to paying the amount
referred to in sub-section (1) or sub-section (3) also be liable to pay interest thereon at the
rate specified under section 50 from the date such amount was collected by him to the date
such amount is paid by him to the Government.
(5) An opportunity of hearing shall be granted where a request is received in writing
from the person to whom the notice was issued to show cause.
(6) The proper officer shall issue an order within one year from the date of issue of the
notice.
(7) Where the issuance of order is stayed by an order of the court or Appellate Tribunal,
the period of such stay shall be excluded in computing the period of one year.
(8) The proper officer, in his order, shall set out the relevant facts and the basis of his
decision.
(9) The amount paid to the Government under sub-section (1) or sub-section (3) shall
be adjusted against the tax payable, if any, by the person in relation to the supplies referred
to in sub-section (1).
(10) Where any surplus is left after the adjustment under sub-section (9), the amount
of such surplus shall either be credited to the Fund or refunded to the person who has borne
the incidence of such amount.
(11) The person who has borne the incidence of the amount, may apply for the refund
of the same in accordance with the provisions of section 54.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 59
77. (1) A registered person who has paid the Central tax and State tax or, as the case Tax
may be, the central tax and the Union territory tax on a transaction considered by him to be wrongfully
collected and
an intra-State supply, but which is subsequently held to be an inter-State supply, shall be
paid to
refunded the amount of taxes so paid in such manner and subject to such conditions as may Central
be prescribed. Government
or State
(2) A registered person who has paid integrated tax on a transaction considered by him Government.
to be an inter-State supply, but which is subsequently held to be an intra-State supply, shall
not be required to pay any interest on the amount of central tax and State tax or, as the case
may be, the central tax and the Union territory tax payable.
78. Any amount payable by a taxable person in pursuance of an order passed under Initiation of
this Act shall be paid by such person within a period of three months from the date of service recovery
proceedings.
of such order failing which recovery proceedings shall be initiated:
Provided that where the proper officer considers it expedient in the interest of revenue,
he may, for reasons to be recorded in writing, require the said taxable person to make such
payment within such period less than a period of three months as may be specified by him.
79. (1) Where any amount payable by a person to the Government under any of the Recovery of
provisions of this Act or the rules made thereunder is not paid, the proper officer shall tax.
proceed to recover the amount by one or more of the following modes, namely:––
(a) the proper officer may deduct or may require any other specified officer to
deduct the amount so payable from any money owing to such person which may be
under the control of the proper officer or such other specified officer;
(b) the proper officer may recover or may require any other specified officer to
recover the amount so payable by detaining and selling any goods belonging to such
person which are under the control of the proper officer or such other specified officer;
(c) (i) the proper officer may, by a notice in writing, require any other person from
whom money is due or may become due to such person or who holds or may
subsequently hold money for or on account of such person, to pay to the Government
either forthwith upon the money becoming due or being held, or within the time specified
in the notice not being before the money becomes due or is held, so much of the money
as is sufficient to pay the amount due from such person or the whole of the money
when it is equal to or less than that amount;
(ii) every person to whom the notice is issued under sub-clause (i) shall be
bound to comply with such notice, and in particular, where any such notice is issued
to a post office, banking company or an insurer, it shall not be necessary to produce
any pass book, deposit receipt, policy or any other document for the purpose of any
entry, endorsement or the like being made before payment is made, notwithstanding
any rule, practice or requirement to the contrary;
(iii) in case the person to whom a notice under sub-clause (i) has been issued,
fails to make the payment in pursuance thereof to the Government, he shall be deemed
to be a defaulter in respect of the amount specified in the notice and all the consequences
of this Act or the rules made thereunder shall follow;
(iv) the officer issuing a notice under sub-clause (i) may, at any time, amend or
revoke such notice or extend the time for making any payment in pursuance of the
notice;
(v) any person making any payment in compliance with a notice issued under
sub-clause (i) shall be deemed to have made the payment under the authority of the
person in default and such payment being credited to the Government shall be deemed60 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
to constitute a good and sufficient discharge of the liability of such person to the
person in default to the extent of the amount specified in the receipt;
(vi) any person discharging any liability to the person in default after service on
him of the notice issued under sub-clause (i) shall be personally liable to the Government
to the extent of the liability discharged or to the extent of the liability of the person in
default for tax, interest and penalty, whichever is less;
(vii) where a person on whom a notice is served under sub-clause (i) proves to
the satisfaction of the officer issuing the notice that the money demanded or any part
thereof was not due to the person in default or that he did not hold any money for or
on account of the person in default, at the time the notice was served on him, nor is the
money demanded or any part thereof, likely to become due to the said person or be
held for or on account of such person, nothing contained in this section shall be
deemed to require the person on whom the notice has been served to pay to the
Government any such money or part thereof;
(d) the proper officer may, in accordance with the rules to be made in this behalf,
distrain any movable or immovable property belonging to or under the control of such
person, and detain the same until the amount payable is paid; and in case, any part of
the said amount payable or of the cost of the distress or keeping of the property,
remains unpaid for a period of thirty days next after any such distress, may cause the
said property to be sold and with the proceeds of such sale, may satisfy the amount
payable and the costs including cost of sale remaining unpaid and shall render the
surplus amount, if any, to such person;
(e) the proper officer may prepare a certificate signed by him specifying the
amount due from such person and send it to the Collector of the district in which such
person owns any property or resides or carries on his business or to any officer
authorised by the Government and the said Collector or the said officer, on receipt of
such certificate, shall proceed to recover from such person the amount specified
thereunder as if it were an arrear of land revenue;
(f) Notwithstanding anything contained in the Code of Criminal
Procedure, 1973, the proper officer may file an application to the appropriate Magistrate 2 of 1974.
and such Magistrate shall proceed to recover from such person the amount specified
thereunder as if it were a fine imposed by him.
(2) Where the terms of any bond or other instrument executed under this Act or any
rules or regulations made thereunder provide that any amount due under such instrument
may be recovered in the manner laid down in sub-section (1), the amount may, without
prejudice to any other mode of recovery, be recovered in accordance with the provisions of
that sub-section.
(3) Where any amount of tax, interest or penalty is payable by a person to the
Government under any of the provisions of this Act or the rules made thereunder and which
remains unpaid, the proper officer of State tax or Union territory tax, during the course of
recovery of said tax arrears, may recover the amount from the said person as if it were an
arrear of State tax or Union territory tax and credit the amount so recovered to the account of
the Government.
(4) Where the amount recovered under sub-section (3) is less than the amount due to
the Central Government and State Government, the amount to be credited to the account of
the respective Governments shall be in proportion to the amount due to each such
Government.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 61
80. On an application filed by a taxable person, the Commissioner may, for reasons to Payment of
tax and other
be recorded in writing, extend the time for payment or allow payment of any amount due
amount in
under this Act, other than the amount due as per the liability self-assessed in any return, by
instalments.
such person in monthly instalments not exceeding twenty four, subject to payment of interest
under section 50 and subject to such conditions and limitations as may be prescribed:
Provided that where there is default in payment of any one instalment on its due date,
the whole outstanding balance payable on such date shall become due and payable forthwith
and shall, without any further notice being served on the person, be liable for recovery.
81. Where a person, after any amount has become due from him, creates a charge on or Transfer of
parts with the property belonging to him or in his possession by way of sale, mortgage, property to
be void in
exchange, or any other mode of transfer whatsoever of any of his properties in favour of any
certain cases.
other person with the intention of defrauding the Government revenue, such charge or
transfer shall be void as against any claim in respect of any tax or any other sum payable by
the said person:
Provided that, such charge or transfer shall not be void if it is made for adequate
consideration, in good faith and without notice of the pendency of such proceedings under
this Act or without notice of such tax or other sum payable by the said person, or with the
previous permission of the proper officer.
82. Notwithstanding anything to the contrary contained in any law for the time being Tax to be
31 of 2016. in force, save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, any first charge
on property.
amount payable by a taxable person or any other person on account of tax, interest or
penalty which he is liable to pay to the Government shall be a first charge on the property of
such taxable person or such person.
83. (1) Where during the pendency of any proceedings under section 62 or section 63 Provisional
or section 64 or section 67 or section 73 or section 74, the Commissioner is of the opinion that attachment to
protect
for the purpose of protecting the interest of the Government revenue, it is necessary so to
revenue in
do, he may, by order in writing attach provisionally any property, including bank account, certain cases.
belonging to the taxable person in such manner as may be prescribed.
(2) Every such provisional attachment shall cease to have effect after the expiry of a
period of one year from the date of the order made under sub-section (1).
84. Where any notice of demand in respect of any tax, penalty, interest or any other Continuation
amount payable under this Act, (hereafter in this section referred to as “Government dues”), and validation
of certain
is served upon any taxable person or any other person and any appeal or revision application
recovery
is filed or any other proceedings is initiated in respect of such Government dues, then–– proceedings.
(a) where such Government dues are enhanced in such appeal, revision or other
proceedings, the Commissioner shall serve upon the taxable person or any other
person another notice of demand in respect of the amount by which such Government
dues are enhanced and any recovery proceedings in relation to such Government
dues as are covered by the notice of demand served upon him before the disposal of
such appeal, revision or other proceedings may, without the service of any fresh
notice of demand, be continued from the stage at which such proceedings stood
immediately before such disposal;
(b) where such Government dues are reduced in such appeal, revision or in other
proceedings––
(i) it shall not be necessary for the Commissioner to serve upon the taxable
person a fresh notice of demand;
(ii) the Commissioner shall give intimation of such reduction to him and to
the appropriate authority with whom recovery proceedings is pending;
(iii) any recovery proceedings initiated on the basis of the demand served
upon him prior to the disposal of such appeal, revision or other proceedings may62 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
be continued in relation to the amount so reduced from the stage at which such
proceedings stood immediately before such disposal.
CHAPTER XVI
LIABILITY TO PAY IN CERTAIN CASES
Liability in 85. (1) Where a taxable person, liable to pay tax under this Act, transfers his business
case of transfer in whole or in part, by sale, gift, lease, leave and license, hire or in any other manner
of business. whatsoever, the taxable person and the person to whom the business is so transferred shall,
jointly and severally, be liable wholly or to the extent of such transfer, to pay the tax, interest
or any penalty due from the taxable person upto the time of such transfer, whether such tax,
interest or penalty has been determined before such transfer, but has remained unpaid or is
determined thereafter.
(2) Where the transferee of a business referred to in sub-section (1) carries on such
business either in his own name or in some other name, he shall be liable to pay tax on the
supply of goods or services or both effected by him with effect from the date of such transfer
and shall, if he is a registered person under this Act, apply within the prescribed time for
amendment of his certificate of registration.
Liability of 86. Where an agent supplies or receives any taxable goods on behalf of his principal,
agent and such agent and his principal shall, jointly and severally, be liable to pay the tax payable on
principal.
such goods under this Act.
Liability in 87. (1) When two or more companies are amalgamated or merged in pursuance of an
case of order of court or of Tribunal or otherwise and the order is to take effect from a date earlier to
amalgamation
the date of the order and any two or more of such companies have supplied or received any
or merger of
companies. goods or services or both to or from each other during the period commencing on the date
from which the order takes effect till the date of the order, then such transactions of supply
and receipt shall be included in the turnover of supply or receipt of the respective companies
and they shall be liable to pay tax accordingly.
(2) Notwithstanding anything contained in the said order, for the purposes of this Act,
the said two or more companies shall be treated as distinct companies for the period up to the
date of the said order and the registration certificates of the said companies shall be cancelled
with effect from the date of the said order.
Liability in 88. (1) When any company is being wound up whether under the orders of a court or
case of
Tribunal or otherwise, every person appointed as receiver of any assets of a company
company in
(hereafter in this section referred to as the “liquidator”), shall, within thirty days after his
liquidation.
appointment, give intimation of his appointment to the Commissioner.
(2) The Commissioner shall, after making such inquiry or calling for such information
as he may deem fit, notify the liquidator within three months from the date on which he
receives intimation of the appointment of the liquidator, the amount which in the opinion of
the Commissioner would be sufficient to provide for any tax, interest or penalty which is
then, or is likely thereafter to become, payable by the company.
(3) When any private company is wound up and any tax, interest or penalty determined
under this Act on the company for any period, whether before or in the course of or after its
liquidation, cannot be recovered, then every person who was a director of such company at
any time during the period for which the tax was due shall, jointly and severally, be liable for
the payment of such tax, interest or penalty, unless he proves to the satisfaction of the
Commissioner that such non-recovery cannot be attributed to any gross neglect, misfeasance
or breach of duty on his part in relation to the affairs of the company.
Liability of 89. (1) Notwithstanding anything contained in the Companies Act, 2013, where any 18 of 2013.
directors of tax, interest or penalty due from a private company in respect of any supply of goods or
private
services or both for any period cannot be recovered, then, every person who was a director
company.
of the private company during such period shall, jointly and severally, be liable for theSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 63
payment of such tax, interest or penalty unless he proves that the non-recovery cannot be
attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the
affairs of the company.
(2) Where a private company is converted into a public company and the tax, interest
or penalty in respect of any supply of goods or services or both for any period during which
such company was a private company cannot be recovered before such conversion, then,
nothing contained in sub-section (1) shall apply to any person who was a director of such
private company in relation to any tax, interest or penalty in respect of such supply of goods
or services or both of such private company:
Provided that nothing contained in this sub-section shall apply to any personal penalty
imposed on such director.
90. Notwithstanding any contract to the contrary and any other law for the time being Liability of
in force, where any firm is liable to pay any tax, interest or penalty under this Act, the firm and partners of
each of the partners of the firm shall, jointly and severally, be liable for such payment: firm to pay
tax.
Provided that where any partner retires from the firm, he or the firm, shall intimate the
date of retirement of the said partner to the Commissioner by a notice in that behalf in writing
and such partner shall be liable to pay tax, interest or penalty due up to the date of his
retirement whether determined or not, on that date:
Provided further that if no such intimation is given within one month from the date of
retirement, the liability of such partner under the first proviso shall continue until the date on
which such intimation is received by the Commissioner.
91. Where the business in respect of which any tax, interest or penalty is payable Liability of
under this Act is carried on by any guardian, trustee or agent of a minor or other incapacitated guardians,
person on behalf of and for the benefit of such minor or other incapacitated person, the tax, trustees, etc.
interest or penalty shall be levied upon and recoverable from such guardian, trustee or agent
in like manner and to the same extent as it would be determined and recoverable from any
such minor or other incapacitated person, as if he were a major or capacitated person and as
if he were conducting the business himself, and all the provisions of this Act or the rules
made thereunder shall apply accordingly.
92. Where the estate or any portion of the estate of a taxable person owning a business Liability of
in respect of which any tax, interest or penalty is payable under this Act is under the control Court of
of the Court of Wards, the Administrator General, the Official Trustee or any receiver or Wards, etc.
manager (including any person, whatever be his designation, who in fact manages the
business) appointed by or under any order of a court, the tax, interest or penalty shall be
levied upon and be recoverable from such Court of Wards, Administrator General, Official
Trustee, receiver or manager in like manner and to the same extent as it would be determined
and be recoverable from the taxable person as if he were conducting the business himself,
and all the provisions of this Act or the rules made thereunder shall apply accordingly.
31of 2016. 93. (1) Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, Special
where a person, liable to pay tax, interest or penalty under this Act, dies, then–– provisions
regarding
(a) if a business carried on by the person is continued after his death by his legal liability to
pay tax,
representative or any other person, such legal representative or other person, shall be
interest or
liable to pay tax, interest or penalty due from such person under this Act; and
penalty in
certain cases.
(b) if the business carried on by the person is discontinued, whether before or
after his death, his legal representative shall be liable to pay, out of the estate of the
deceased, to the extent to which the estate is capable of meeting the charge, the tax,
interest or penalty due from such person under this Act,
whether such tax, interest or penalty has been determined before his death but has remained
unpaid or is determined after his death.64 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(2) Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, where a 31 of 2016.
taxable person, liable to pay tax, interest or penalty under this Act, is a Hindu Undivided
Family or an association of persons and the property of the Hindu Undivided Family or the
association of persons is partitioned amongst the various members or groups of members,
then, each member or group of members shall, jointly and severally, be liable to pay the tax,
interest or penalty due from the taxable person under this Act up to the time of the partition
whether such tax, penalty or interest has been determined before partition but has remained
unpaid or is determined after the partition.
(3) Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, where a 31 of 2016.
taxable person, liable to pay tax, interest or penalty under this Act, is a firm, and the firm is
dissolved, then, every person who was a partner shall, jointly and severally, be liable to pay
the tax, interest or penalty due from the firm under this Act up to the time of dissolution
whether such tax, interest or penalty has been determined before the dissolution, but has
remained unpaid or is determined after dissolution.
(4) Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016, where a 31 of 2016.
taxable person liable to pay tax, interest or penalty under this Act,––
(a) is the guardian of a ward on whose behalf the business is carried on by the
guardian; or
(b) is a trustee who carries on the business under a trust for a beneficiary,
then, if the guardianship or trust is terminated, the ward or the beneficiary shall be liable to
pay the tax, interest or penalty due from the taxable person upto the time of the termination
of the guardianship or trust, whether such tax, interest or penalty has been determined
before the termination of guardianship or trust but has remained unpaid or is determined
thereafter.
Liability in 94. (1) Where a taxable person is a firm or an association of persons or a Hindu
other cases. Undivided Family and such firm, association or family has discontinued business––
(a) the tax, interest or penalty payable under this Act by such firm, association or
family up to the date of such discontinuance may be determined as if no such
discontinuance had taken place; and
(b) every person who, at the time of such discontinuance, was a partner of such
firm, or a member of such association or family, shall, notwithstanding such
discontinuance, jointly and severally, be liable for the payment of tax and interest
determined and penalty imposed and payable by such firm, association or family,
whether such tax and interest has been determined or penalty imposed prior to or after
such discontinuance and subject as aforesaid, the provisions of this Act shall, so far
as may be, apply as if every such person or partner or member were himself a taxable
person.
(2) Where a change has occurred in the constitution of a firm or an association of
persons, the partners of the firm or members of association, as it existed before and as it
exists after the reconstitution, shall, without prejudice to the provisions of section 90, jointly
and severally, be liable to pay tax, interest or penalty due from such firm or association for
any period before its reconstitution.
(3) The provisions of sub-section (1) shall, so far as may be, apply where the taxable
person, being a firm or association of persons is dissolved or where the taxable person, being
a Hindu Undivided Family, has effected partition with respect to the business carried on by
it and accordingly references in that sub-section to discontinuance shall be construed as
reference to dissolution or to partition.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 65
Explanation.––For the purposes of this Chapter,––
(i) a “Limited Liability Partnership” formed and registered under the provisions
6 of 2009. of the Limited Liability Partnership Act, 2008 shall also be considered as a firm;
(ii) “court” means the District Court, High Court or Supreme Court.
CHAPTER XVII
ADVANCE RULING
95. In this Chapter, unless the context otherwise requires,–– Definitions.
(a) “advance ruling” means a decision provided by the Authority or the Appellate
Authority to an applicant on matters or on questions specified in sub-section (2) of
section 97 or sub-section (1) of section 100, in relation to the supply of goods or
services or both being undertaken or proposed to be undertaken by the applicant;
(b) “Appellate Authority” means the Appellate Authority for Advance Ruling
referred to in section 99;
(c) “applicant” means any person registered or desirous of obtaining registration
under this Act;
(d) “application” means an application made to the Authority under
sub-section (1) of section 97;
(e) “Authority” means the Authority for Advance Ruling referred to in
section 96.
96. Subject to the provisions of this Chapter, for the purposes of this Act, the Authority Authority for
for advance ruling constituted under the provisions of a State Goods and Services Tax Act or advance
ruling.
Union Territory Goods and Services Tax Act shall be deemed to be the Authority for advance
ruling in respect of that State or Union territory.
97. (1) An applicant desirous of obtaining an advance ruling under this Chapter may Application
make an application in such form and manner and accompanied by such fee as may be for advance
prescribed, stating the question on which the advance ruling is sought. ruling.
(2) The question on which the advance ruling is sought under this Act, shall be in
respect of,––
(a) classification of any goods or services or both;
(b) applicability of a notification issued under the provisions of this Act;
(c) determination of time and value of supply of goods or services or both;
(d) admissibility of input tax credit of tax paid or deemed to have been paid;
(e) determination of the liability to pay tax on any goods or services or both;
(f) whether applicant is required to be registered;
(g) whether any particular thing done by the applicant with respect to any goods
or services or both amounts to or results in a supply of goods or services or both,
within the meaning of that term.
98. (1) On receipt of an application, the Authority shall cause a copy thereof to be Procedure on
forwarded to the concerned officer and, if necessary, call upon him to furnish the relevant receipt of
records: application.
Provided that where any records have been called for by the Authority in any case,
such records shall, as soon as possible, be returned to the said concerned officer.
(2) The Authority may, after examining the application and the records called for and
after hearing the applicant or his authorised representative and the concerned officer or his
authorised representative, by order, either admit or reject the application:66 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Provided that the Authority shall not admit the application where the question raised
in the application is already pending or decided in any proceedings in the case of an applicant
under any of the provisions of this Act:
Provided further that no application shall be rejected under this sub-section unless an
opportunity of hearing has been given to the applicant:
Provided also that where the application is rejected, the reasons for such rejection
shall be specified in the order.
(3) A copy of every order made under sub-section (2) shall be sent to the applicant and
to the concerned officer.
(4) Where an application is admitted under sub-section (2), the Authority shall, after
examining such further material as may be placed before it by the applicant or obtained by the
Authority and after providing an opportunity of being heard to the applicant or his authorised
representative as well as to the concerned officer or his authorised representative, pronounce
its advance ruling on the question specified in the application.
(5) Where the members of the Authority differ on any question on which the advance
ruling is sought, they shall state the point or points on which they differ and make a reference
to the Appellate Authority for hearing and decision on such question.
(6) The Authority shall pronounce its advance ruling in writing within ninety days
from the date of receipt of application.
(7) A copy of the advance ruling pronounced by the Authority duly signed by the
members and certified in such manner as may be prescribed shall be sent to the applicant, the
concerned officer and the jurisdictional officer after such pronouncement.
Appellate 99. Subject to the provisions of this Chapter, for the purposes of this Act, the Appellate
Authority for Authority for Advance Ruling constituted under the provisions of a State Goods and Services
Advance Tax Act or a Union Territory Goods and Services Tax Act shall be deemed to be the Appellate
Ruling.
Authority in respect of that State or Union territory.
Appeal to 100. (1) The concerned officer, the jurisdictional officer or an applicant aggrieved by
Appellate any advance ruling pronounced under sub-section (4) of section 98, may appeal to the
Authority. Appellate Authority.
(2) Every appeal under this section shall be filed within a period of thirty days from the
date on which the ruling sought to be appealed against is communicated to the concerned
officer, the jurisdictional officer and the applicant:
Provided that the Appellate Authority may, if it is satisfied that the appellant was
prevented by a sufficient cause from presenting the appeal within the said period of thirty
days, allow it to be presented within a further period not exceeding thirty days.
(3) Every appeal under this section shall be in such form, accompanied by such fee and
verified in such manner as may be prescribed.
Orders of 101. (1) The Appellate Authority may, after giving the parties to the appeal or reference
Appellate
an opportunity of being heard, pass such order as it thinks fit, confirming or modifying the
Authority.
ruling appealed against or referred to.
(2) The order referred to in sub-section (1) shall be passed within a period of
ninety days from the date of filing of the appeal under section 100 or a reference under
sub-section (5) of section 98.
(3) Where the members of the Appellate Authority differ on any point or points referred
to in appeal or reference, it shall be deemed that no advance ruling can be issued in respect
of the question under the appeal or reference.
(4) A copy of the advance ruling pronounced by the Appellate Authority duly signed
by the Members and certified in such manner as may be prescribed shall be sent to theSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 67
applicant, the concerned officer, the jurisdictional officer and to the Authority after such
pronouncement.
102. The Authority or the Appellate Authority may amend any order passed by it Rectification
under section 98 or section 101, so as to rectify any error apparent on the face of the record, of advance
ruling.
if such error is noticed by the Authority or the Appellate Authority on its own accord, or is
brought to its notice by the concerned officer, the jurisdictional officer, the applicant or the
appellant within a period of six months from the date of the order:
Provided that no rectification which has the effect of enhancing the tax liability or
reducing the amount of admissible input tax credit shall be made unless the applicant or the
appellant has been given an opportunity of being heard.
103. (1) The advance ruling pronounced by the Authority or the Appellate Authority Applicability
under this Chapter shall be binding only— of advance
ruling.
(a) on the applicant who had sought it in respect of any matter referred to in
sub-section (2) of section 97 for advance ruling;
(b) on the concerned officer or the jurisdictional officer in respect of the applicant
.
(2) The advance ruling referred to in sub-section (1) shall be binding unless the law,
facts or circumstances supporting the original advance ruling have changed.
104. (1) Where the Authority or the Appellate Authority finds that advance Advance
ruling pronounced by it under sub-section (4) of section 98 or under sub-section (1) of ruling to be
void in
section 101 has been obtained by the applicant or the appellant by fraud or suppression of
certain
material facts or misrepresentation of facts, it may, by order, declare such ruling to be void
circumstances.
ab-initio and thereupon all the provisions of this Act or the rules made thereunder shall
apply to the applicant or the appellant as if such advance ruling had never been made:
Provided that no order shall be passed under this sub-section unless an opportunity
of being heard has been given to the applicant or the appellant.
Explanation.––The period beginning with the date of such advance ruling and ending
with the date of order under this sub-section shall be excluded while computing the period
specified in sub-sections (2) and (10) of section 73 or sub-sections (2) and (10) of
section 74.
(2) A copy of the order made under sub-section (1) shall be sent to the applicant, the
concerned officer and the jurisdictional officer.
105. (1) The Authority or the Appellate Authority shall, for the purpose of exercising Powers of
its powers regarding— Authority
and Appellate
(a) discovery and inspection; Authority.
(b) enforcing the attendance of any person and examining him on oath;
(c) issuing commissions and compelling production of books of account
and other records,
5 of 1908. have all the powers of a civil court under the Code of Civil Procedure, 1908.
(2) The Authority or the Appellate Authority shall be deemed to be a civil court for the
purposes of section 195, but not for the purposes of Chapter XXVI of the Code of Criminal
2 of 1974. Procedure, 1973, and every proceeding before the Authority or the Appellate Authority shall
be deemed to be a judicial proceedings within the meaning of sections 193 and 228, and for
45 of 1860. the purpose of section 196 of the Indian Penal Code.
106. The Authority or the Appellate Authority shall, subject to the provisions of this Procedure of
Chapter, have power to regulate its own procedure. Authority and
Appellate
Authority.68 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
CHAPTER XVIII
APPEALS AND REVISION
Appeals to 107. (1) Any person aggrieved by any decision or order passed under this Act or the
Appellate State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act by an
Authority.
adjudicating authority may appeal to such Appellate Authority as may be prescribed within
three months from the date on which the said decision or order is communicated to such
person.
(2) The Commissioner may, on his own motion, or upon request from the Commissioner
of State tax or the Commissioner of Union territory tax, call for and examine the record of any
proceedings in which an adjudicating authority has passed any decision or order under this
Act or the State Goods and Services Tax Act or the Union Territory Goods and Services Tax
Act, for the purpose of satisfying himself as to the legality or propriety of the said decision
or order and may, by order, direct any officer subordinate to him to apply to the Appellate
Authority within six months from the date of communication of the said decision or order for
the determination of such points arising out of the said decision or order as may be specified
by the Commissioner in his order.
(3) Where, in pursuance of an order under sub-section (2), the authorised officer
makes an application to the Appellate Authority, such application shall be dealt with by the
Appellate Authority as if it were an appeal made against the decision or order of the
adjudicating authority and such authorised officer were an appellant and the provisions of
this Act relating to appeals shall apply to such application.
(4) The Appellate Authority may, if he is satisfied that the appellant was prevented by
sufficient cause from presenting the appeal within the aforesaid period of three months or six
months, as the case may be, allow it to be presented within a further period of one month.
(5) Every appeal under this section shall be in such form and shall be verified in such
manner as may be prescribed.
(6) No appeal shall be filed under sub-section (1), unless the appellant has paid—
(a) in full, such part of the amount of tax, interest, fine, fee and penalty arising
from the impugned order, as is admitted by him; and
(b) a sum equal to ten per cent. of the remaining amount of tax in dispute arising
from the said order, in relation to which the appeal has been filed.
(7) Where the appellant has paid the amount under sub-section (6), the recovery
proceedings for the balance amount shall be deemed to be stayed.
(8) The Appellate Authority shall give an opportunity to the appellant of being heard.
(9) The Appellate Authority may, if sufficient cause is shown at any stage of hearing of
an appeal, grant time to the parties or any of them and adjourn the hearing of the appeal for
reasons to be recorded in writing:
Provided that no such adjournment shall be granted more than three times to a party
during hearing of the appeal.
(10) The Appellate Authority may, at the time of hearing of an appeal, allow an appellant
to add any ground of appeal not specified in the grounds of appeal, if it is satisfied that the
omission of that ground from the grounds of appeal was not wilful or unreasonable.
(11) The Appellate Authority shall, after making such further inquiry as may be
necessary, pass such order, as it thinks just and proper, confirming, modifying or annulling
the decision or order appealed against but shall not refer the case back to the adjudicating
authority that passed the said decision or order:SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 69
Provided that an order enhancing any fee or penalty or fine in lieu of confiscation or
confiscating goods of greater value or reducing the amount of refund or input tax credit shall
not be passed unless the appellant has been given a reasonable opportunity of showing
cause against the proposed order:
Provided further that where the Appellate Authority is of the opinion that any tax has
not been paid or short-paid or erroneously refunded, or where input tax credit has been
wrongly availed or utilised, no order requiring the appellant to pay such tax or input tax credit
shall be passed unless the appellant is given notice to show cause against the proposed
order and the order is passed within the time limit specified under section 73 or
section 74.
(12) The order of the Appellate Authority disposing of the appeal shall be in writing
and shall state the points for determination, the decision thereon and the reasons for such
decision.
(13) The Appellate Authority shall, where it is possible to do so, hear and decide every
appeal within a period of one year from the date on which it is filed:
Provided that where the issuance of order is stayed by an order of a court or Tribunal,
the period of such stay shall be excluded in computing the period of one year.
(14) On disposal of the appeal, the Appellate Authority shall communicate the order
passed by it to the appellant, respondent and to the adjudicating authority.
(15) A copy of the order passed by the Appellate Authority shall also be sent to the
jurisdictional Commissioner or the authority designated by him in this behalf and the
jurisdictional Commissioner of State tax or Commissioner of Union Territory Tax or an authority
designated by him in this behalf.
(16) Every order passed under this section shall, subject to the provisions of
section 108 or section 113 or section 117 or section 118 be final and binding on the parties.
108. (1) Subject to the provisions of section 121 and any rules made thereunder, the Powers of
Revisional Authority may, on his own motion, or upon information received by him or on Revisional
Authority.
request from the Commissioner of State tax, or the Commissioner of Union territory tax, call
for and examine the record of any proceedings, and if he considers that any decision or order
passed under this Act or under the State Goods and Services Tax Act or the Union Territory
Goods and Services Tax Act by any officer subordinate to him is erroneous in so far as it is
prejudicial to the interest of revenue and is illegal or improper or has not taken into account
certain material facts, whether available at the time of issuance of the said order or not or in
consequence of an observation by the Comptroller and Auditor General of India, he may, if
necessary, stay the operation of such decision or order for such period as he deems fit and
after giving the person concerned an opportunity of being heard and after making such
further inquiry as may be necessary, pass such order, as he thinks just and proper, including
enhancing or modifying or annulling the said decision or order.
(2) The Revisional Authority shall not exercise any power under sub-section (1), if—
(a) the order has been subject to an appeal under section 107 or section 112 or
section 117 or section 118; or
(b) the period specified under sub-section (2) of section 107 has not yet expired
or more than three years have expired after the passing of the decision or order sought
to be revised; or
(c) the order has already been taken for revision under this section at an earlier
stage; or
(d) the order has been passed in exercise of the powers under sub-section (1):70 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Provided that the Revisional Authority may pass an order under sub-section (1) on
any point which has not been raised and decided in an appeal referred to in clause (a) of
sub-section (2), before the expiry of a period of one year from the date of the order in
such appeal or before the expiry of a period of three years referred to in clause (b) of that
sub-section, whichever is later.
(3) Every order passed in revision under sub-section (1) shall, subject to the provisions
of section 113 or section 117 or section 118, be final and binding on the parties.
(4) If the said decision or order involves an issue on which the Appellate Tribunal or
the High Court has given its decision in some other proceedings and an appeal to the High
Court or the Supreme Court against such decision of the Appellate Tribunal or the High
Court is pending, the period spent between the date of the decision of the Appellate Tribunal
and the date of the decision of the High Court or the date of the decision of the High Court
and the date of the decision of the Supreme Court shall be excluded in computing the period
of limitation referred to in clause (b) of sub-section (2) where proceedings for revision have
been initiated by way of issue of a notice under this section.
(5) Where the issuance of an order under sub-section (1) is stayed by the order of a
court or Appellate Tribunal, the period of such stay shall be excluded in computing the
period of limitation referred to in clause (b) of sub-section (2).
(6) For the purposes of this section, the term,––
(i) “record” shall include all records relating to any proceedings under this Act
available at the time of examination by the Revisional Authority;
(ii) “decision” shall include intimation given by any officer lower in rank than
the Revisional Authority.
Constitution 109. (1) The Government shall, on the recommendations of the Council, by notification,
of Appellate constitute with effect from such date as may be specified therein, an Appellate Tribunal
Tribunal and known as the Goods and Services Tax Appellate Tribunal for hearing appeals against the
Benches
orders passed by the Appellate Authority or the Revisional Authority.
thereof.
(2) The powers of the Appellate Tribunal shall be exercisable by the National Bench
and Benches thereof (hereinafter in this Chapter referred to as “Regional Benches”), State
Bench and Benches thereof (hereafter in this Chapter referred to as “Area Benches”).
(3) The National Bench of the Appellate Tribunal shall be situated at New Delhi which
shall be presided over by the President and shall consist of one Technical Member (Centre)
and one Technical Member (State).
(4) The Government shall, on the recommendations of the Council, by notification,
constitute such number of Regional Benches as may be required and such Regional Benches
shall consist of a Judicial Member, one Technical Member (Centre) and one Technical Member
(State).
(5) The National Bench or Regional Benches of the Appellate Tribunal shall have
jurisdiction to hear appeals against the orders passed by the Appellate Authority or the
Revisional Authority in the cases where one of the issues involved relates to the place of
supply.
(6) The Government shall, by notification, specify for each State or Union territory, a
Bench of the Appellate Tribunal (hereafter in this Chapter, referred to as “State Bench”) for
exercising the powers of the Appellate Tribunal within the concerned State or Union territory:
Provided that the Government shall, on receipt of a request from any State Government,
constitute such number of Area Benches in that State, as may be recommended by the
Council:SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 71
Provided further that the Government may, on receipt of a request from any State, or on
its own motion for a Union territory, notify the Appellate Tribunal in a State to act as the
Appellate Tribunal for any other State or Union territory, as may be recommended by the
Council, subject to such terms and conditions as may be prescribed.
(7) The State Bench or Area Benches shall have jurisdiction to hear appeals against
the orders passed by the Appellate Authority or the Revisional Authority in the cases
involving matters other than those referred to in sub-section (5).
(8) The President and the State President shall, by general or special order, distribute
the business or transfer cases among Regional Benches or, as the case may be, Area Benches
in a State.
(9) Each State Bench and Area Benches of the Appellate Tribunal shall consist of a
Judicial Member, one Technical Member (Centre) and one Technical Member (State) and the
State Government may designate the senior most Judicial Member in a State as the State
President.
(10) In the absence of a Member in any Bench due to vacancy or otherwise, any appeal
may, with the approval of the President or, as the case may be, the State President, be heard
by a Bench of two Members:
Provided that any appeal where the tax or input tax credit involved or the difference in
tax or input tax credit involved or the amount of fine, fee or penalty determined in any order
appealed against, does not exceed five lakh rupees and which does not involve any question
of law may, with the approval of the President and subject to such conditions as may be
prescribed on the recommendations of the Council, be heard by a bench consisting of a
single member.
(11) If the Members of the National Bench, Regional Benches, State Bench or Area
Benches differ in opinion on any point or points, it shall be decided according to the opinion
of the majority, if there is a majority, but if the Members are equally divided, they shall state
the point or points on which they differ, and the case shall be referred by the President or as
the case may be, State President for hearing on such point or points to one or more of the
other Members of the National Bench, Regional Benches, State Bench or Area Benches and
such point or points shall be decided according to the opinion of the majority of Members
who have heard the case, including those who first heard it.
(12) The Government, in consultation with the President may, for the administrative
convenience, transfer—
(a) any Judicial Member or a Member Technical (State) from one Bench to another
Bench, whether National or Regional; or
(b) any Member Technical (Centre) from one Bench to another Bench, whether
National, Regional, State or Area.
(13) The State Government, in consultation with the State President may, for the
administrative convenience, transfer a Judicial Member or a Member Technical (State) from
one Bench to another Bench within the State.
(14) No act or proceedings of the Appellate Tribunal shall be questioned or shall be
invalid merely on the ground of the existence of any vacancy or defect in the constitution of
the Appellate Tribunal.
110. (1) A person shall not be qualified for appointment as— President and
Members of
(a) the President, unless he has been a Judge of the Supreme Court or is or has
Appellate
been the Chief Justice of a High Court, or is or has been a Judge of a High Court for a Tribunal,
period not less than five years; their
qualification,
(b) a Judicial Member, unless he— appointment,
conditions of
(i) has been a Judge of the High Court; or
service, etc.
(ii) is or has been a District Judge qualified to be appointed as a Judge of
a High Court; or72 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(iii) is or has been a Member of Indian Legal Service and has held a post
not less than Additional Secretary for three years;
(c) a Technical Member (Centre) unless he is or has been a member of
Indian Revenue (Customs and Central Excise) Service, Group A, and has
completed at least fifteen years of service in Group A;
(d) a Technical Member (State) unless he is or has been an officer of the
State Government not below the rank of Additional Commissioner of Value Added
Tax or the State goods and services tax or such rank as may be notified by the
concerned State Government on the recommendations of the Council with at
least three years of experience in the administration of an existing law or the
State Goods and Services Tax Act or in the field of finance and taxation.
(2) The President and the Judicial Members of the National Bench and the Regional
Benches shall be appointed by the Government after consultation with the Chief Justice of
India or his nominee:
Provided that in the event of the occurrence of any vacancy in the office of the
President by reason of his death, resignation or otherwise, the senior most Member of the
National Bench shall act as the President until the date on which a new President, appointed
in accordance with the provisions of this Act to fill such vacancy, enters upon his office:
Provided further that where the President is unable to discharge his functions owing
to absence, illness or any other cause, the senior most Member of the National Bench shall
discharge the functions of the President until the date on which the President resumes his
duties.
(3) The Technical Member (Centre) and Technical Member (State) of the National
Bench and Regional Benches shall be appointed by the Government on the recommendations
of a Selection Committee consisting of such persons and in such manner as may be prescribed.
(4) The Judicial Member of the State Bench or Area Benches shall be appointed by the
State Government after consultation with the Chief Justice of the High Court of the State or
his nominee.
(5) The Technical Member (Centre) of the State Bench or Area Benches shall be
appointed by the Central Government and Technical Member (State) of the State Bench or
Area Benches shall be appointed by the State Government in such manner as may be
prescribed.
(6) No appointment of the Members of the Appellate Tribunal shall be invalid merely
by the reason of any vacancy or defect in the constitution of the Selection Committee.
(7) Before appointing any person as the President or Members of the Appellate Tribunal,
the Central Government or, as the case may be, the State Government, shall satisfy itself that
such person does not have any financial or other interests which are likely to prejudicially
affect his functions as such President or Member.
(8) The salary, allowances and other terms and conditions of service of the President,
State President and the Members of the Appellate Tribunal shall be such as may be prescribed:
Provided that neither salary and allowances nor other terms and conditions of service
of the President, State President or Members of the Appellate Tribunal shall be varied to their
disadvantage after their appointment.
(9) The President of the Appellate Tribunal shall hold office for a term of three years
from the date on which he enters upon his office, or until he attains the age of seventy years,
whichever is earlier and shall be eligible for reappointment.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 73
(10) The Judicial Member of the Appellate Tribunal and the State President shall hold
office for a term of three years from the date on which he enters upon his office, or until he
attains the age of sixty-five years, whichever is earlier and shall be eligible for
reappointment.
(11) The Technical Member (Centre) or Technical Member (State) of the Appellate
Tribunal shall hold office for a term of five years from the date on which he enters upon his
office, or until he attains the age of sixty-five years, whichever is earlier and shall be eligible
for reappointment.
(12) The President, State President or any Member may, by notice in writing under his
hand addressed to the Central Government or, as the case may be, the State Government
resign from his office:
Provided that the President, State President or Member shall continue to hold office
until the expiry of three months from the date of receipt of such notice by the Central
Government, or, as the case may be, the State Government or until a person duly appointed
as his successor enters upon his office or until the expiry of his term of office, whichever is
the earliest.
(13) The Central Government may, after consultation with the Chief Justice of India, in
case of the President, Judicial Members and Technical Members of the National Bench,
Regional Benches or Technical Members (Centre) of the State Bench or Area Benches, and
the State Government may, after consultation with the Chief Justice of High Court, in case of
the State President, Judicial Members, Technical Members (State) of the State Bench or Area
Benches, may remove from the office such President or Member, who—
(a) has been adjudged an insolvent; or
(b) has been convicted of an offence which, in the opinion of such
Government involves moral turpitude; or
(c) has become physically or mentally incapable of acting as such President,
State President or Member; or
(d) has acquired such financial or other interest as is likely to affect
prejudicially his functions as such President, State President or Member; or
(e) has so abused his position as to render his continuance in office
prejudicial to the public interest:
Provided that the President, State President or the Member shall not be removed
on any of the grounds specified in clauses (d) and (e), unless he has been informed of
the charges against him and has been given an opportunity of being heard.
(14) Without prejudice to the provisions of sub-section (13),––
(a) the President or a Judicial and Technical Member of the National Bench or
Regional Benches, Technical Member (Centre) of the State Bench or Area Benches
shall not be removed from their office except by an order made by the Central Government
on the ground of proved misbehaviour or incapacity after an inquiry made by a Judge
of the Supreme Court nominated by the Chief Justice of India on a reference made to
him by the Central Government and of which the President or the said Member had
been given an opportunity of being heard;
(b) the Judicial Member or Technical Member (State) of the State Bench or Area
Benches shall not be removed from their office except by an order made by the State
Government on the ground of proved misbehaviour or incapacity after an inquiry
made by a Judge of the concerned High Court nominated by the Chief Justice of the
concerned High Court on a reference made to him by the State Government and of
which the said Member had been given an opportunity of being heard.
(15) The Central Government, with the concurrence of the Chief Justice of India, may
suspend from office, the President or a Judicial or Technical Members of the National Bench74 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
or the Regional Benches or the Technical Member (Centre) of the State Bench or Area
Benches in respect of whom a reference has been made to the Judge of the Supreme Court
under sub-section (14).
(16) The State Government, with the concurrence of the Chief Justice of the High
Court, may suspend from office, a Judicial Member or Technical Member (State) of the State
Bench or Area Benches in respect of whom a reference has been made to the Judge of the
High Court under sub-section (14).
(17) Subject to the provisions of article 220 of the Constitution, the President, State
President or other Members, on ceasing to hold their office, shall not be eligible to appear, act
or plead before the National Bench and the Regional Benches or the State Bench and the
Area Benches thereof where he was the President or, as the case may be, a Member.
Procedure 111. (1) The Appellate Tribunal shall not, while disposing of any proceedings before it
before or an appeal before it, be bound by the procedure laid down in the Code of Civil
Appellate
Tribunal. Procedure, 1908, but shall be guided by the principles of natural justice and subject to the 5 of 1908.
other provisions of this Act and the rules made thereunder, the Appellate Tribunal shall have
power to regulate its own procedure.
(2) The Appellate Tribunal shall, for the purposes of discharging its functions under
this Act, have the same powers as are vested in a civil court under the Code of Civil
Procedure, 1908 while trying a suit in respect of the following matters, namely:— 5 of 1908.
(a) summoning and enforcing the attendance of any person and examining him
on oath;
(b) requiring the discovery and production of documents;
(c) receiving evidence on affidavits;
(d) subject to the provisions of sections 123 and 124 of the Indian Evidence
Act, 1872, requisitioning any public record or document or a copy of such record or 1 of 1872.
document from any office;
(e) issuing commissions for the examination of witnesses or documents;
(f) dismissing a representation for default or deciding it ex parte;
(g) setting aside any order of dismissal of any representation for default or any
order passed by it ex parte; and
(h) any other matter which may be prescribed.
(3) Any order made by the Appellate Tribunal may be enforced by it in the same
manner as if it were a decree made by a court in a suit pending therein, and it shall be lawful
for the Appellate Tribunal to send for execution of its orders to the court within the local
limits of whose jurisdiction,—
(a) in the case of an order against a company, the registered office of the company
is situated; or
(b) in the case of an order against any other person, the person concerned
voluntarily resides or carries on business or personally works for gain.
(4) All proceedings before the Appellate Tribunal shall be deemed to be judicial
proceedings within the meaning of sections 193 and 228, and for the purposes of section 196
of the Indian Penal Code, and the Appellate Tribunal shall be deemed to be civil court for the 45 of 1860.
purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973. 2 of 1974.
Appeals to 112. (1) Any person aggrieved by an order passed against him under section 107 or
Appellate section 108 of this Act or the State Goods and Services Tax Act or the Union Territory
Tribunal.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 75
Goods and Services Tax Act may appeal to the Appellate Tribunal against such order within
three months from the date on which the order sought to be appealed against is communicated
to the person preferring the appeal.
(2) The Appellate Tribunal may, in its discretion, refuse to admit any such appeal
where the tax or input tax credit involved or the difference in tax or input tax credit
involved or the amount of fine, fee or penalty determined by such order, does not exceed fifty
thousand rupees.
(3) The Commissioner may, on his own motion, or upon request from the Commissioner
of State tax or Commissioner of Union territory tax, call for and examine the record of any
order passed by the Appellate Authority or the Revisional Authority under this Act or the
State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act for the
purpose of satisfying himself as to the legality or propriety of the said order and may, by
order, direct any officer subordinate to him to apply to the Appellate Tribunal within six
months from the date on which the said order has been passed for determination of such
points arising out of the said order as may be specified by the Commissioner in his order.
(4) Where in pursuance of an order under sub-section (3) the authorised officer makes
an application to the Appellate Tribunal, such application shall be dealt with by the Appellate
Tribunal as if it were an appeal made against the order under sub-section (11) of section 107
or under sub-section (1) of section 108 and the provisions of this Act shall apply to such
application, as they apply in relation to appeals filed under sub-section (1).
(5) On receipt of notice that an appeal has been preferred under this section, the party
against whom the appeal has been preferred may, notwithstanding that he may not have
appealed against such order or any part thereof, file, within forty-five days of the receipt of
notice, a memorandum of cross-objections, verified in the prescribed manner, against any
part of the order appealed against and such memorandum shall be disposed of by the
Appellate Tribunal, as if it were an appeal presented within the time specified in
sub-section (1).
(6) The Appellate Tribunal may admit an appeal within three months after the expiry of
the period referred to in sub-section (1), or permit the filing of a memorandum of
cross-objections within forty-five days after the expiry of the period referred to in
sub-section (5) if it is satisfied that there was sufficient cause for not presenting it within that
period.
(7) An appeal to the Appellate Tribunal shall be in such form, verified in such manner
and shall be accompanied by such fee, as may be prescribed.
(8) No appeal shall be filed under sub-section (1), unless the appellant has paid––
(a) in full, such part of the amount of tax, interest, fine, fee and penalty arising
from the impugned order, as is admitted by him, and
(b) a sum equal to twenty per cent. of the remaining amount of tax in dispute, in
addition to the amount paid under sub-section (6) of section 107, arising from the said
order, in relation to which the appeal has been filed.
(9) Where the appellant has paid the amount as per sub-section (8), the recovery
proceedings for the balance amount shall be deemed to be stayed till the disposal of the
appeal.
(10) Every application made before the Appellate Tribunal,—
(a) in an appeal for rectification of error or for any other purpose; or
(b) for restoration of an appeal or an application,
shall be accompanied by such fees as may be prescribed.76 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Orders of 113. (1) The Appellate Tribunal may, after giving the parties to the appeal
Appellate an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying
Tribunal.
or annulling the decision or order appealed against or may refer the case back to the Appellate
Authority, or the Revisional Authority or to the original adjudicating authority, with such
directions as it may think fit, for a fresh adjudication or decision after taking additional
evidence, if necessary.
(2) The Appellate Tribunal may, if sufficient cause is shown, at any stage of hearing of
an appeal, grant time to the parties or any of them and adjourn the hearing of the appeal for
reasons to be recorded in writing:
Provided that no such adjournment shall be granted more than three times to a party
during hearing of the appeal.
(3) The Appellate Tribunal may amend any order passed by it under sub-section (1) so
as to rectify any error apparent on the face of the record, if such error is noticed by it on its
own accord, or is brought to its notice by the Commissioner or the Commissioner of State tax
or the Commissioner of the Union territory tax or the other party to the appeal within a period
of three months from the date of the order:
Provided that no amendment which has the effect of enhancing an assessment or
reducing a refund or input tax credit or otherwise increasing the liability of the other party,
shall be made under this sub-section, unless the party has been given an opportunity of
being heard.
(4) The Appellate Tribunal shall, as far as possible, hear and decide every appeal
within a period of one year from the date on which it is filed.
(5) The Appellate Tribunal shall send a copy of every order passed under this section
to the Appellate Authority or the Revisional Authority, or the original adjudicating authority,
as the case may be, the appellant and the jurisdictional Commissioner or the Commissioner of
State tax or the Union territory tax.
(6) Save as provided in section 117 or section 118, orders passed by the Appellate
Tribunal on an appeal shall be final and binding on the parties.
Financial and 114. The President shall exercise such financial and administrative powers over the
administrative National Bench and Regional Benches of the Appellate Tribunal as may be prescribed:
powers of
President. Provided that the President shall have the authority to delegate such of his financial
and administrative powers as he may think fit to any other Member or any officer of the
National Bench and Regional Benches, subject to the condition that such Member or officer
shall, while exercising such delegated powers, continue to act under the direction, control
and supervision of the President.
Interest on 115. Where an amount paid by the appellant under sub-section (6) of section 107 or
refund of sub-section (8) of section 112 is required to be refunded consequent to any order of the
amount paid
Appellate Authority or of the Appellate Tribunal, interest at the rate specified under section 56
for admission
shall be payable in respect of such refund from the date of payment of the amount till the date
of appeal.
of refund of such amount.
Appearance 116. (1) Any person who is entitled or required to appear before an officer appointed
by authorised under this Act, or the Appellate Authority or the Appellate Tribunal in connection with any
representative.
proceedings under this Act, may, otherwise than when required under this Act to appear
personally for examination on oath or affirmation, subject to the other provisions of this
section, appear by an authorised representative.
(2) For the purposes of this Act, the expression “authorised representative” shall
mean a person authorised by the person referred to in sub-section (1) to appear on his
behalf, being—
(a) his relative or regular employee; orSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 77
(b) an advocate who is entitled to practice in any court in India, and who has not
been debarred from practicing before any court in India; or
(c) any chartered accountant, a cost accountant or a company secretary, who
holds a certificate of practice and who has not been debarred from practice; or
(d) a retired officer of the Commercial Tax Department of any State Government
or Union territory or of the Board who, during his service under the Government, had
worked in a post not below the rank than that of a Group-B Gazetted officer for a period
of not less than two years:
Provided that such officer shall not be entitled to appear before any proceedings
under this Act for a period of one year from the date of his retirement or resignation; or
(e) any person who has been authorised to act as a goods and services tax
practitioner on behalf of the concerned registered person.
(3) No person,—
(a) who has been dismissed or removed from Government service; or
(b) who is convicted of an offence connected with any proceedings under this
Act, the State Goods and Services Tax Act, the Integrated Goods and Services Tax Act
or the Union Territory Goods and Services Tax Act, or under the existing law or under
any of the Acts passed by a State Legislature dealing with the imposition of taxes on
sale of goods or supply of goods or services or both; or
(c) who is found guilty of misconduct by the prescribed authority;
(d) who has been adjudged as an insolvent,
shall be qualified to represent any person under sub-section (1)—
(i) for all times in case of persons referred to in clauses (a), (b) and (c); and
(ii) for the period during which the insolvency continues in the case of a person
referred to in clause (d).
(4) Any person who has been disqualified under the provisions of the State Goods and
Services Tax Act or the Union Territory Goods and Services Tax Act shall be deemed to be
disqualified under this Act.
117. (1) Any person aggrieved by any order passed by the State Bench or Area Appeal to
Benches of the Appellate Tribunal may file an appeal to the High Court and the High Court High Court.
may admit such appeal, if it is satisfied that the case involves a substantial question of law.
(2) An appeal under sub-section (1) shall be filed within a period of one hundred and
eighty days from the date on which the order appealed against is received by the aggrieved
person and it shall be in such form, verified in such manner as may be prescribed:
Provided that the High Court may entertain an appeal after the expiry of the said period
if it is satisfied that there was sufficient cause for not filing it within such period.
(3) Where the High Court is satisfied that a substantial question of law is involved in
any case, it shall formulate that question and the appeal shall be heard only on the question
so formulated, and the respondents shall, at the hearing of the appeal, be allowed to argue
that the case does not involve such question:
Provided that nothing in this sub-section shall be deemed to take away or abridge the
power of the court to hear, for reasons to be recorded, the appeal on any other substantial
question of law not formulated by it, if it is satisfied that the case involves such question.
(4) The High Court shall decide the question of law so formulated and deliver such
judgment thereon containing the grounds on which such decision is founded and may
award such cost as it deems fit.78 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(5) The High Court may determine any issue which––
(a) has not been determined by the State Bench or Area Benches; or
(b) has been wrongly determined by the State Bench or Area Benches, by reason
of a decision on such question of law as herein referred to in sub-section (3).
(6) Where an appeal has been filed before the High Court, it shall be heard by a Bench
of not less than two Judges of the High Court, and shall be decided in accordance with the
opinion of such Judges or of the majority, if any, of such Judges.
(7) Where there is no such majority, the Judges shall state the point of law upon which
they differ and the case shall, then, be heard upon that point only, by one or more of the other
Judges of the High Court and such point shall be decided according to the opinion of the
majority of the Judges who have heard the case including those who first heard it.
(8) Where the High Court delivers a judgment in an appeal filed before it under this
section, effect shall be given to such judgment by either side on the basis of a certified copy
of the judgment.
(9) Save as otherwise provided in this Act, the provisions of the Code of Civil
Procedure, 1908, relating to appeals to the High Court shall, as far as may be, apply in the 5 of 1908.
case of appeals under this section.
Appeal to 118. (1) An appeal shall lie to the Supreme Court—
Supreme
Court. (a) from any order passed by the National Bench or Regional Benches of the
Appellate Tribunal; or
(b) from any judgment or order passed by the High Court in an appeal made
under section 117 in any case which, on its own motion or on an application made by
or on behalf of the party aggrieved, immediately after passing of the judgment or order,
the High Court certifies to be a fit one for appeal to the Supreme Court.
(2) The provisions of the Code of Civil Procedure, 1908, relating to appeals to the 5 of 1908.
Supreme Court shall, so far as may be, apply in the case of appeals under this section as they
apply in the case of appeals from decrees of a High Court.
(3) Where the judgment of the High Court is varied or reversed in the appeal, effect
shall be given to the order of the Supreme Court in the manner provided in section 117 in the
case of a judgment of the High Court.
Sums due to 119. Notwithstanding that an appeal has been preferred to the High Court or the
be paid
Supreme Court, sums due to the Government as a result of an order passed by the National
notwithstanding
or Regional Benches of the Appellate Tribunal under sub-section (1) of section 113 or an
appeal, etc.
order passed by the State Bench or Area Benches of the Appellate Tribunal under sub-
section (1) of section 113 or an order passed by the High Court under section 117, as the case
may be, shall be payable in accordance with the order so passed.
Appeal not to 120. (1) The Board may, on the recommendations of the Council, from time to time,
be filed in
issue orders or instructions or directions fixing such monetary limits, as it may deem fit, for
certain cases.
the purposes of regulating the filing of appeal or application by the officer of the central tax
under the provisions of this Chapter.
(2) Where, in pursuance of the orders or instructions or directions issued under
sub-section (1), the officer of the central tax has not filed an appeal or application against any
decision or order passed under the provisions of this Act, it shall not preclude such officer
of the central tax from filing appeal or application in any other case involving the same or
similar issues or questions of law.
(3) Notwithstanding the fact that no appeal or application has been filed by the officer
of the central tax pursuant to the orders or instructions or directions issued under
sub-section (1), no person, being a party in appeal or application shall contend that theSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 79
officer of the central tax has acquiesced in the decision on the disputed issue by not filing an
appeal or application.
(4) The Appellate Tribunal or court hearing such appeal or application shall have
regard to the circumstances under which appeal or application was not filed by the officer of
the central tax in pursuance of the orders or instructions or directions issued under
sub-section (1).
121. Notwithstanding anything to the contrary in any provisions of this Act, no Non-
appeal shall lie against any decision taken or order passed by an officer of central tax if such appealable
decisions and
decision taken or order passed relates to any one or more of the following matters, namely:—
orders.
(a) an order of the Commissioner or other authority empowered to direct transfer
of proceedings from one officer to another officer; or
(b) an order pertaining to the seizure or retention of books of account, register
and other documents; or
(c) an order sanctioning prosecution under this Act; or
(d) an order passed under section 80.
CHAPTER XIX
OFFENCES AND PENALTIES
122. (1) Where a taxable person who–– Penalty for
certain
(i) supplies any goods or services or both without issue of any invoice or issues offences.
an incorrect or false invoice with regard to any such supply;
(ii) issues any invoice or bill without supply of goods or services or both in
violation of the provisions of this Act or the rules made thereunder;
(iii) collects any amount as tax but fails to pay the same to the Government
beyond a period of three months from the date on which such payment becomes due;
(iv) collects any tax in contravention of the provisions of this Act but fails to pay
the same to the Government beyond a period of three months from the date on which
such payment becomes due;
(v) fails to deduct the tax in accordance with the provisions of sub-section (1) of
section 51, or deducts an amount which is less than the amount required to be deducted
under the said sub-section, or where he fails to pay to the Government under sub-
section (2) thereof, the amount deducted as tax;
(vi) fails to collect tax in accordance with the provisions of sub-section (1) of
section 52, or collects an amount which is less than the amount required to be collected
under the said sub-section or where he fails to pay to the Government the amount
collected as tax under sub-section (3) of section 52;
(vii) takes or utilises input tax credit without actual receipt of goods or services
or both either fully or partially, in contravention of the provisions of this Act or the
rules made thereunder;
(viii) fraudulently obtains refund of tax under this Act;
(ix) takes or distributes input tax credit in contravention of section 20, or the
rules made thereunder;
(x) falsifies or substitutes financial records or produces fake accounts or
documents or furnishes any false information or return with an intention to evade
payment of tax due under this Act;80 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(xi) is liable to be registered under this Act but fails to obtain registration;
(xii) furnishes any false information with regard to registration particulars, either
at the time of applying for registration, or subsequently;
(xiii) obstructs or prevents any officer in discharge of his duties under this Act;
(xiv) transports any taxable goods without the cover of documents as may be
specified in this behalf;
(xv) suppresses his turnover leading to evasion of tax under this Act;
(xvi) fails to keep, maintain or retain books of account and other documents in
accordance with the provisions of this Act or the rules made thereunder;
(xvii) fails to furnish information or documents called for by an officer in
accordance with the provisions of this Act or the rules made thereunder or furnishes
false information or documents during any proceedings under this Act;
(xviii) supplies, transports or stores any goods which he has reasons to believe
are liable to confiscation under this Act;
(xix) issues any invoice or document by using the registration number of another
registered person;
(xx) tampers with, or destroys any material evidence or document;
(xxi) disposes off or tampers with any goods that have been detained, seized, or
attached under this Act,
he shall be liable to pay a penalty of ten thousand rupees or an amount equivalent to the tax
evaded or the tax not deducted under section 51 or short deducted or deducted but not paid
to the Government or tax not collected under section 52 or short collected or collected but
not paid to the Government or input tax credit availed of or passed on or distributed irregularly,
or the refund claimed fraudulently, whichever is higher.
(2) Any registered person who supplies any goods or services or both on which any
tax has not been paid or short-paid or erroneously refunded, or where the input tax credit has
been wrongly availed or utilised,—
(a) for any reason, other than the reason of fraud or any wilful misstatement or
suppression of facts to evade tax, shall be liable to a penalty of ten thousand rupees or
ten per cent. of the tax due from such person, whichever is higher;
(b) for reason of fraud or any wilful misstatement or suppression of facts to
evade tax, shall be liable to a penalty equal to ten thousand rupees or the tax due from
such person, whichever is higher.
(3) Any person who––
(a) aids or abets any of the offences specified in clauses (i) to (xxi) of
sub-section (1);
(b) acquires possession of, or in any way concerns himself in transporting,
removing, depositing, keeping, concealing, supplying, or purchasing or in any other
manner deals with any goods which he knows or has reasons to believe are liable to
confiscation under this Act or the rules made thereunder;
(c) receives or is in any way concerned with the supply of, or in any other
manner deals with any supply of services which he knows or has reasons to believe
are in contravention of any provisions of this Act or the rules made thereunder;
(d) fails to appear before the officer of central tax, when issued with a summon
for appearance to give evidence or produce a document in an inquiry;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 81
(e) fails to issue invoice in accordance with the provisions of this Act or the rules
made thereunder or fails to account for an invoice in his books of account,
shall be liable to a penalty which may extend to twenty-five thousand rupees.
123. If a person who is required to furnish an information return under section 150 fails Penalty for
to do so within the period specified in the notice issued under sub-section (3) thereof, the failure to
proper officer may direct that such person shall be liable to pay a penalty of one hundred furnish
information
rupees for each day of the period during which the failure to furnish such return continues:
return.
Provided that the penalty imposed under this section shall not exceed five thousand
rupees.
124. If any person required to furnish any information or return under section 151,—
Fine for
failure to
(a) without reasonable cause fails to furnish such information or return as may
furnish
be required under that section, or statistics.
(b) wilfully furnishes or causes to furnish any information or return which he
knows to be false,
he shall be punishable with a fine which may extend to ten thousand rupees and in case of a
continuing offence to a further fine which may extend to one hundred rupees for each day
after the first day during which the offence continues subject to a maximum limit of twenty-
five thousand rupees.
125. Any person, who contravenes any of the provisions of this Act or any rules made General
thereunder for which no penalty is separately provided for in this Act, shall be liable to a penalty.
penalty which may extend to twenty-five thousand rupees.
126. (1) No officer under this Act shall impose any penalty for minor breaches of tax General
regulations or procedural requirements and in particular, any omission or mistake in disciplines
documentation which is easily rectifiable and made without fraudulent intent or gross related to
penalty.
negligence.
Explanation.––For the purpose of this sub-section,––
(a) a breach shall be considered a ‘minor breach’ if the amount of tax involved is
less than five thousand rupees;
(b) an omission or mistake in documentation shall be considered to be easily
rectifiable if the same is an error apparent on the face of record.
(2) The penalty imposed under this Act shall depend on the facts and circumstances of
each case and shall be commensurate with the degree and severity of the breach.
(3) No penalty shall be imposed on any person without giving him an opportunity of
being heard.
(4) The officer under this Act shall while imposing penalty in an order for a breach of
any law, regulation or procedural requirement, specify the nature of the breach and the
applicable law, regulation or procedure under which the amount of penalty for the breach has
been specified.
(5) When a person voluntarily discloses to an officer under this Act the circumstances
of a breach of the tax law, regulation or procedural requirement prior to the discovery of the
breach by the officer under this Act, the proper officer may consider this fact as a mitigating
factor when quantifying a penalty for that person.
(6) The provisions of this section shall not apply in such cases where the penalty
specified under this Act is either a fixed sum or expressed as a fixed percentage.
127. Where the proper officer is of the view that a person is liable to a penalty and the Power to
same is not covered under any proceedings under section 62 or section 63 or section 64 or impose
penalty in
certain cases.82 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
section 73 or section 74 or section 129 or section 130, he may issue an order levying such
penalty after giving a reasonable opportunity of being heard to such person.
Power to 128. The Government may, by notification, waive in part or full, any penalty referred to
waive penalty in section 122 or section 123 or section 125 or any late fee referred to in section 47 for such
or fee or both.
class of taxpayers and under such mitigating circumstances as may be specified therein on
the recommendations of the Council.
Detention, 129. (1) Notwithstanding anything contained in this Act, where any person transports
seizure and any goods or stores any goods while they are in transit in contravention of the provisions of
release of
this Act or the rules made thereunder, all such goods and conveyance used as a means of
goods and
conveyances transport for carrying the said goods and documents relating to such goods and conveyance
in transit. shall be liable to detention or seizure and after detention or seizure, shall be released,––
(a) on payment of the applicable tax and penalty equal to one hundred per cent.
of the tax payable on such goods and, in case of exempted goods, on payment of an
amount equal to two per cent. of the value of goods or twenty-five thousand rupees,
whichever is less, where the owner of the goods comes forward for payment of such
tax and penalty;
(b) on payment of the applicable tax and penalty equal to the fifty per cent. of the
value of the goods reduced by the tax amount paid thereon and, in case of exempted
goods, on payment of an amount equal to five per cent. of the value of goods or
twenty-five thousand rupees, whichever is less, where the owner of the goods does
not come forward for payment of such tax and penalty;
(c) upon furnishing a security equivalent to the amount payable under clause (a)
or clause (b) in such form and manner as may be prescribed:
Provided that no such goods or conveyance shall be detained or seized without
serving an order of detention or seizure on the person transporting the goods.
(2) The provisions of sub-section (6) of section 67 shall, mutatis mutandis, apply for
detention and seizure of goods and conveyances.
(3) The proper officer detaining or seizing goods or conveyances shall issue a notice
specifying the tax and penalty payable and thereafter, pass an order for payment of tax and
penalty under clause (a) or clause (b) or clause (c).
(4) No tax, interest or penalty shall be determined under sub-section (3) without giving
the person concerned an opportunity of being heard.
(5) On payment of amount referred in sub-section (1), all proceedings in respect of the
notice specified in sub-section (3) shall be deemed to be concluded.
(6) Where the person transporting any goods or the owner of the goods fails to pay
the amount of tax and penalty as provided in sub-section (1) within seven days of such
detention or seizure, further proceedings shall be initiated in accordance with the provisions
of section 130:
Provided that where the detained or seized goods are perishable or hazardous in
nature or are likely to depreciate in value with passage of time, the said period of seven days
may be reduced by the proper officer.
Confiscation 130. (1) Notwithstanding anything contained in this Act, if any person—
of goods or
conveyances (i) supplies or receives any goods in contravention of any of the provisions of
and levy of
this Act or the rules made thereunder with intent to evade payment of tax; or
penalty.
(ii) does not account for any goods on which he is liable to pay tax under this
Act; or
(iii) supplies any goods liable to tax under this Act without having applied for
registration; orSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 83
(iv) contravenes any of the provisions of this Act or the rules made thereunder
with intent to evade payment of tax; or
(v) uses any conveyance as a means of transport for carriage of goods in
contravention of the provisions of this Act or the rules made thereunder unless the
owner of the conveyance proves that it was so used without the knowledge or
connivance of the owner himself, his agent, if any, and the person in charge of the
conveyance,
then, all such goods or conveyances shall be liable to confiscation and the person shall be
liable to penalty under section 122.
(2) Whenever confiscation of any goods or conveyance is authorised by this Act, the
officer adjudging it shall give to the owner of the goods an option to pay in lieu of confiscation,
such fine as the said officer thinks fit:
Provided that such fine leviable shall not exceed the market value of the goods
confiscated, less the tax chargeable thereon:
Provided further that the aggregate of such fine and penalty leviable shall not be less
than the amount of penalty leviable under sub-section (1) of section 129:
Provided also that where any such conveyance is used for the carriage of the goods or
passengers for hire, the owner of the conveyance shall be given an option to pay in lieu of
the confiscation of the conveyance a fine equal to the tax payable on the goods being
transported thereon.
(3) Where any fine in lieu of confiscation of goods or conveyance is imposed under
sub-section (2), the owner of such goods or conveyance or the person referred to in
sub-section (1), shall, in addition, be liable to any tax, penalty and charges payable in respect
of such goods or conveyance.
(4) No order for confiscation of goods or conveyance or for imposition of penalty shall
be issued without giving the person an opportunity of being heard.
(5) Where any goods or conveyance are confiscated under this Act, the title of such
goods or conveyance shall thereupon vest in the Government.
(6) The proper officer adjudging confiscation shall take and hold possession of the
things confiscated and every officer of Police, on the requisition of such proper officer, shall
assist him in taking and holding such possession.
(7) The proper officer may, after satisfying himself that the confiscated goods or
conveyance are not required in any other proceedings under this Act and after giving
reasonable time not exceeding three months to pay fine in lieu of confiscation, dispose of
such goods or conveyance and deposit the sale proceeds thereof with the Government.
131. Without prejudice to the provisions contained in the Code of Criminal Confiscation
2 of 1974. Procedure, 1973, no confiscation made or penalty imposed under the provisions of this Act or penalty
not to
or the rules made thereunder shall prevent the infliction of any other punishment to which
interfere with
the person affected thereby is liable under the provisions of this Act or under any other law
other
for the time being in force. punishments.
132. (1) Whoever commits any of the following offences, namely:— Punishment
for certain
(a) supplies any goods or services or both without issue of any invoice, in offences.
violation of the provisions of this Act or the rules made thereunder, with the intention
to evade tax;
(b) issues any invoice or bill without supply of goods or services or both in
violation of the provisions of this Act, or the rules made thereunder leading to wrongful
availment or utilisation of input tax credit or refund of tax;84 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(c) avails input tax credit using such invoice or bill referred to in clause (b);
(d) collects any amount as tax but fails to pay the same to the Government
beyond a period of three months from the date on which such payment becomes due;
(e) evades tax, fraudulently avails input tax credit or fraudulently obtains refund
and where such offence is not covered under clauses (a) to (d);
(f) falsifies or substitutes financial records or produces fake accounts or
documents or furnishes any false information with an intention to evade payment of
tax due under this Act;
(g) obstructs or prevents any officer in the discharge of his duties under this
Act;
(h) acquires possession of, or in any way concerns himself in transporting,
removing, depositing, keeping, concealing, supplying, or purchasing or in any other
manner deals with, any goods which he knows or has reasons to believe are liable to
confiscation under this Act or the rules made thereunder;
(i) receives or is in any way concerned with the supply of, or in any other manner
deals with any supply of services which he knows or has reasons to believe are in
contravention of any provisions of this Act or the rules made thereunder;
(j) tampers with or destroys any material evidence or documents;
(k) fails to supply any information which he is required to supply under this Act
or the rules made thereunder or (unless with a reasonable belief, the burden of proving
which shall be upon him, that the information supplied by him is true) supplies false
information; or
(l) attempts to commit, or abets the commission of any of the offences mentioned
in clauses (a) to (k) of this section,
shall be punishable––
(i) in cases where the amount of tax evaded or the amount of input tax credit
wrongly availed or utilised or the amount of refund wrongly taken exceeds five hundred
lakh rupees, with imprisonment for a term which may extend to five years and with fine;
(ii) in cases where the amount of tax evaded or the amount of input tax credit
wrongly availed or utilised or the amount of refund wrongly taken exceeds two hundred
lakh rupees but does not exceed five hundred lakh rupees, with imprisonment for a
term which may extend to three years and with fine;
(iii) in the case of any other offence where the amount of tax evaded or the
amount of input tax credit wrongly availed or utilised or the amount of refund wrongly
taken exceeds one hundred lakh rupees but does not exceed two hundred lakh rupees,
with imprisonment for a term which may extend to one year and with fine;
(iv) in cases where he commits or abets the commission of an offence specified
in clause (f) or clause (g) or clause (j), he shall be punishable with imprisonment for a
term which may extend to six months or with fine or with both.
(2) Where any person convicted of an offence under this section is again convicted of
an offence under this section, then, he shall be punishable for the second and for every
subsequent offence with imprisonment for a term which may extend to five years and with
fine.
(3) The imprisonment referred to in clauses (i), (ii) and (iii) of sub-section (1) and
sub-section (2) shall, in the absence of special and adequate reasons to the contrary to be
recorded in the judgment of the Court, be for a term not less than six months.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 85
2 of 1974. (4) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, all
offences under this Act, except the offences referred to in sub-section (5) shall be
non-cognizable and bailable.
(5) The offences specified in clause (a) or clause (b) or clause (c) or clause (d) of
sub-section (1) and punishable under clause (i) of that sub-section shall be cognizable and
non-bailable.
(6) A person shall not be prosecuted for any offence under this section except with the
previous sanction of the Commissioner.
Explanation.— For the purposes of this section, the term “tax” shall include the
amount of tax evaded or the amount of input tax credit wrongly availed or utilised or refund
wrongly taken under the provisions of this Act, the State Goods and Services Tax Act, the
Integrated Goods and Services Tax Act or the Union Territory Goods and Services Tax Act
and cess levied under the Goods and Services Tax (Compensation to States) Act.
133. (1) Where any person engaged in connection with the collection of statistics Liability of
under section 151 or compilation or computerisation thereof or if any officer of central tax officers and
having access to information specified under sub-section (1) of section 150, or if any person certain other
persons.
engaged in connection with the provision of service on the common portal or the agent of
common portal, wilfully discloses any information or the contents of any return furnished
under this Act or rules made thereunder otherwise than in execution of his duties under the
said sections or for the purposes of prosecution for an offence under this Act or under any
other Act for the time being in force, he shall be punishable with imprisonment for a term
which may extend to six months or with fine which may extend to twenty-five thousand
rupees, or with both.
(2) Any person—
(a) who is a Government servant shall not be prosecuted for any offence under
this section except with the previous sanction of the Government;
(b) who is not a Government servant shall not be prosecuted for any offence
under this section except with the previous sanction of the Commissioner.
134. No court shall take cognizance of any offence punishable under this Act or the Cognizance of
rules made thereunder except with the previous sanction of the Commissioner, and no court offences.
inferior to that of a Magistrate of the First Class, shall try any such offence.
135. In any prosecution for an offence under this Act which requires a culpable mental Presumption
state on the part of the accused, the court shall presume the existence of such mental state of culpable
but it shall be a defence for the accused to prove the fact that he had no such mental state mental state.
with respect to the act charged as an offence in that prosecution.
Explanation.—For the purposes of this section,––
(i) the expression “culpable mental state” includes intention, motive, knowledge
of a fact, and belief in, or reason to believe, a fact;
(ii) a fact is said to be proved only when the court believes it to exist beyond
reasonable doubt and not merely when its existence is established by a preponderance
of probability.
136. A statement made and signed by a person on appearance in response to any Relevancy of
summons issued under section 70 during the course of any inquiry or proceedings under statements
this Act shall be relevant, for the purpose of proving, in any prosecution for an offence under under certain
circumstances.
this Act, the truth of the facts which it contains,––
(a) when the person who made the statement is dead or cannot be found, or is
incapable of giving evidence, or is kept out of the way by the adverse party, or whose
presence cannot be obtained without an amount of delay or expense which, under the
circumstances of the case, the court considers unreasonable; or86 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(b) when the person who made the statement is examined as a witness in the case
before the court and the court is of the opinion that, having regard to the circumstances
of the case, the statement should be admitted in evidence in the interest of justice.
Offences by 137. (1) Where an offence committed by a person under this Act is a company, every
companies. person who, at the time the offence was committed was in charge of, and was responsible to,
the company for the conduct of business of the company, as well as the company, shall be
deemed to be guilty of the offence and shall be liable to be proceeded against and punished
accordingly.
(2) Notwithstanding anything contained in sub-section (1), where an offence under
this Act has been committed by a company and it is proved that the offence has been
committed with the consent or connivance of, or is attributable to any negligence on the part
of, any director, manager, secretary or other officer of the company, such director, manager,
secretary or other officer shall also be deemed to be guilty of that offence and shall be liable
to be proceeded against and punished accordingly.
(3) Where an offence under this Act has been committed by a taxable person being a
partnership firm or a Limited Liability Partnership or a Hindu Undivided Family or a trust, the
partner or karta or managing trustee shall be deemed to be guilty of that offence and shall be
liable to be proceeded against and punished accordingly and the provisions of sub-section (2)
shall, mutatis mutandis, apply to such persons.
(4) Nothing contained in this section shall render any such person liable to any
punishment provided in this Act, if he proves that the offence was committed without his
knowledge or that he had exercised all due diligence to prevent the commission of such
offence.
Explanation.––For the purposes of this section,––
(i) “company” means a body corporate and includes a firm or other association
of individuals; and
(ii) “director”, in relation to a firm, means a partner in the firm.
Compounding 138. (1) Any offence under this Act may, either before or after the institution of
of offences. prosecution, be compounded by the Commissioner on payment, by the person accused of
the offence, to the Central Government or the State Government, as the case be, of such
compounding amount in such manner as may be prescribed:
Provided that nothing contained in this section shall apply to—
(a) a person who has been allowed to compound once in respect of any of the
offences specified in clauses (a) to (f) of sub-section (1) of section 132 and the offences
specified in clause (l) which are relatable to offences specified in clauses (a) to (f) of
the said sub-section;
(b) a person who has been allowed to compound once in respect of any offence,
other than those in clause (a), under this Act or under the provisions of any State
Goods and Services Tax Act or the Union Territory Goods and Services Tax Act or the
Integrated Goods and Services Tax Act in respect of supplies of value exceeding one
crore rupees;
(c) a person who has been accused of committing an offence under this Act
which is also an offence under any other law for the time being in force;
(d) a person who has been convicted for an offence under this Act by a court;
(e) a person who has been accused of committing an offence specified in clause (g)
or clause (j) or clause (k) of sub-section (1) of section 132; andSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 87
(f) any other class of persons or offences as may be prescribed:
Provided further that any compounding allowed under the provisions of this
section shall not affect the proceedings, if any, instituted under any other law:
Provided also that compounding shall be allowed only after making payment of
tax, interest and penalty involved in such offences.
(2) The amount for compounding of offences under this section shall be such as may
be prescribed, subject to the minimum amount not being less than ten thousand rupees or
fifty per cent. of the tax involved, whichever is higher, and the maximum amount not being
less than thirty thousand rupees or one hundred and fifty per cent. of the tax, whichever is
higher.
(3) On payment of such compounding amount as may be determined by the
Commissioner, no further proceedings shall be initiated under this Act against the accused
person in respect of the same offence and any criminal proceedings, if already initiated in
respect of the said offence, shall stand abated.
CHAPTER XX
TRANSITIONAL PROVISIONS
139. (1) On and from the appointed day, every person registered under any of the Migration of
existing laws and having a valid Permanent Account Number shall be issued a certificate of existing
registration on provisional basis, subject to such conditions and in such form and manner as taxpayers.
may be prescribed, which unless replaced by a final certificate of registration under
sub-section (2), shall be liable to be cancelled if the conditions so prescribed are not complied
with.
(2) The final certificate of registration shall be granted in such form and manner and
subject to such conditions as may be prescribed.
(3) The certificate of registration issued to a person under sub-section (1) shall be
deemed to have not been issued if the said registration is cancelled in pursuance of an
application filed by such person that he was not liable to registration under section 22 or
section 24.
140. (1) A registered person, other than a person opting to pay tax under section 10, Transitional
shall be entitled to take, in his electronic credit ledger, the amount of CENVAT credit carried arrangements
for input tax
forward in the return relating to the period ending with the day immediately preceding the
credit.
appointed day, furnished by him under the existing law in such manner as may be prescribed:
Provided that the registered person shall not be allowed to take credit in the following
circumstances, namely:—
(i) where the said amount of credit is not admissible as input tax credit under this
Act; or
(ii) where he has not furnished all the returns required under the existing law for
the period of six months immediately preceding the appointed date; or
(iii) where the said amount of credit relates to goods manufactured and cleared
under such exemption notifications as are notified by the Government.
(2) A registered person, other than a person opting to pay tax under section 10, shall be
entitled to take, in his electronic credit ledger, credit of the unavailed CENVAT credit in
respect of capital goods, not carried forward in a return, furnished under the existing law by
him, for the period ending with the day immediately preceding the appointed day in such
manner as may be prescribed:
Provided that the registered person shall not be allowed to take credit unless the said
credit was admissible as CENVAT credit under the existing law and is also admissible as input
tax credit under this Act.88 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Explanation.––For the purposes of this sub-section, the expression “unavailed
CENVAT credit” means the amount that remains after subtracting the amount of CENVAT
credit already availed in respect of capital goods by the taxable person under the existing law
from the aggregate amount of CENVAT credit to which the said person was entitled in
respect of the said capital goods under the existing law.
(3) A registered person, who was not liable to be registered under the existing law, or
who was engaged in the manufacture of exempted goods or provision of exempted services,
or who was providing works contract service and was availing of the benefit of notification
No. 26/2012—Service Tax, dated the 20th June, 2012 or a first stage dealer or a second stage
dealer or a registered importer or a depot of a manufacturer, shall be entitled to take, in his
electronic credit ledger, credit of eligible duties in respect of inputs held in stock and inputs
contained in semi-finished or finished goods held in stock on the appointed day subject to
the following conditions, namely:––
(i) such inputs or goods are used or intended to be used for making taxable
supplies under this Act;
(ii) the said registered person is eligible for input tax credit on such inputs under
this Act;
(iii) the said registered person is in possession of invoice or other prescribed
documents evidencing payment of duty under the existing law in respect of such
inputs;
(iv) such invoices or other prescribed documents were issued not earlier than
twelve months immediately preceding the appointed day; and
(v) the supplier of services is not eligible for any abatement under this Act:
Provided that where a registered person, other than a manufacturer or a supplier of
services, is not in possession of an invoice or any other documents evidencing payment of
duty in respect of inputs, then, such registered person shall, subject to such conditions,
limitations and safeguards as may be prescribed, including that the said taxable person shall
pass on the benefit of such credit by way of reduced prices to the recipient, be allowed to
take credit at such rate and in such manner as may be prescribed.
(4) A registered person, who was engaged in the manufacture of taxable as well as
exempted goods under the Central Excise Act, 1944 or provision of taxable as well as exempted 1 of 1944.
services under Chapter V of the Finance Act, 1994, but which are liable to tax under this Act, 32 of 1994.
shall be entitled to take, in his electronic credit ledger,—
(a) the amount of CENVAT credit carried forward in a return furnished under the
existing law by him in accordance with the provisions of sub-section (1); and
(b) the amount of CENVAT credit of eligible duties in respect of inputs held in
stock and inputs contained in semi-finished or finished goods held in stock on the
appointed day, relating to such exempted goods or services, in accordance with the
provisions of sub-section (3).
(5) A registered person shall be entitled to take, in his electronic credit ledger, credit of
eligible duties and taxes in respect of inputs or input services received on or after the
appointed day but the duty or tax in respect of which has been paid by the supplier under the
existing law, subject to the condition that the invoice or any other duty or tax paying document
of the same was recorded in the books of account of such person within a period of thirty
days from the appointed day:
Provided that the period of thirty days may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding thirty days:
Provided further that said registered person shall furnish a statement, in such manner
as may be prescribed, in respect of credit that has been taken under this sub-section.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 89
(6) A registered person, who was either paying tax at a fixed rate or paying a fixed
amount in lieu of the tax payable under the existing law shall be entitled to take, in his
electronic credit ledger, credit of eligible duties in respect of inputs held in stock and inputs
contained in semi-finished or finished goods held in stock on the appointed day subject to
the following conditions, namely:––
(i) such inputs or goods are used or intended to be used for making taxable
supplies under this Act;
(ii) the said registered person is not paying tax under section 10;
(iii) the said registered person is eligible for input tax credit on such inputs
under this Act;
(iv) the said registered person is in possession of invoice or other prescribed
documents evidencing payment of duty under the existing law in respect of inputs;
and
(v) such invoices or other prescribed documents were issued not earlier than
twelve months immediately preceding the appointed day.
(7) Notwithstanding anything to the contrary contained in this Act, the input tax credit
on account of any services received prior to the appointed day by an Input Service Distributor
shall be eligible for distribution as credit under this Act even if the invoices relating to such
services are received on or after the appointed day.
(8) Where a registered person having centralised registration under the existing law
has obtained a registration under this Act, such person shall be allowed to take, in his
electronic credit ledger, credit of the amount of CENVAT credit carried forward in a return,
furnished under the existing law by him, in respect of the period ending with the day
immediately preceding the appointed day in such manner as may be prescribed:
Provided that if the registered person furnishes his return for the period ending with
the day immediately preceding the appointed day within three months of the appointed day,
such credit shall be allowed subject to the condition that the said return is either an original
return or a revised return where the credit has been reduced from that claimed earlier:
Provided further that the registered person shall not be allowed to take credit unless
the said amount is admissible as input tax credit under this Act:
Provided also that such credit may be transferred to any of the registered persons
having the same Permanent Account Number for which the centralised registration was
obtained under the existing law.
(9) Where any CENVAT credit availed for the input services provided under the existing
law has been reversed due to non-payment of the consideration within a period of three
months, such credit can be reclaimed subject to the condition that the registered person has
made the payment of the consideration for that supply of services within a period of three
months from the appointed day.
(10) The amount of credit under sub-sections (3), (4) and (6) shall be calculated in
such manner as may be prescribed.
Explanation 1.—For the purposes of sub-sections (3), (4) and (6), the expression
“eligible duties” means––
(i) the additional duty of excise leviable under section 3 of the Additional Duties
58 of 1957. of Excise (Goods of Special Importance) Act, 1957;
(ii) the additional duty leviable under sub-section (1) of section 3 of the Customs
51 of 1975. Tariff Act, 1975;
(iii) the additional duty leviable under sub-section (5) of section 3 of the Customs
51 of 1975. Tariff Act, 1975;90 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(iv) the additional duty of excise leviable under section 3 of the Additional
Duties of Excise (Textile and Textile Articles) Act, 1978; 40 of 1978.
(v) the duty of excise specified in the First Schedule to the Central Excise Tariff
5 of 1986.
Act, 1985;
(vi) the duty of excise specified in the Second Schedule to the Central Excise
5 of 1986.
Tariff Act, 1985; and
(vii) the National Calamity Contingent Duty leviable under section 136 of the
Finance Act, 2001, 14 of 2001.
in respect of inputs held in stock and inputs contained in semi-finished or finished
goods held in stock on the appointed day.
Explanation 2.—For the purposes of sub-section (5), the expression “eligible
duties and taxes” means––
(i) the additional duty of excise leviable under section 3 of the Additional Duties
of Excise (Goods of Special Importance) Act, 1957; 58 of 1957.
(ii) the additional duty leviable under sub-section (1) of section 3 of the Customs
Tariff Act, 1975; 51 of 1975.
(iii) the additional duty leviable under sub-section (5) of section 3 of the Customs
Tariff Act, 1975; 51 of 1975.
(iv) the additional duty of excise leviable under section 3 of the Additional
Duties of Excise (Textile and Textile Articles) Act, 1978; 40 of 1978.
(v) the duty of excise specified in the First Schedule to the Central Excise Tariff
Act, 1985; 5 of 1986.
(vi) the duty of excise specified in the Second Schedule to the Central Excise
Tariff Act, 1985; 5 of 1986.
(vii) the National Calamity Contingent Duty leviable under section 136 of the
Finance Act, 2001; and 14 of 2001.
(viii) the service tax leviable under section 66B of the Finance Act, 1994, 32 of 1994.
in respect of inputs and input services received on or after the appointed day.
Transitional 141. (1) Where any inputs received at a place of business had been removed as such
provisions or removed after being partially processed to a job worker for further processing, testing,
relating to job repair, reconditioning or any other purpose in accordance with the provisions of existing law
work.
prior to the appointed day and such inputs are returned to the said place on or after the
appointed day, no tax shall be payable if such inputs, after completion of the job work or
otherwise, are returned to the said place within six months from the appointed day:
Provided that the period of six months may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding two months:
Provided further that if such inputs are not returned within the period specified in this
sub-section, the input tax credit shall be liable to be recovered in accordance with the
provisions of clause (a) of sub-section (8) of section 142.
(2) Where any semi-finished goods had been removed from the place of business to
any other premises for carrying out certain manufacturing processes in accordance with
the provisions of existing law prior to the appointed day and such goods (hereafter in this
section referred to as “the said goods”) are returned to the said place on or after the
appointed day, no tax shall be payable, if the said goods, after undergoing manufacturing
processes or otherwise, are returned to the said place within six months from the appointed
day:SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 91
Provided that the period of six months may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding two months:
Provided further that if the said goods are not returned within the period specified in
this sub-section, the input tax credit shall be liable to be recovered in accordance with the
provisions of clause (a) of sub-section (8) of section 142:
Provided also that the manufacturer may, in accordance with the provisions of the
existing law, transfer the said goods to the premises of any registered person for the purpose
of supplying therefrom on payment of tax in India or without payment of tax for exports
within the period specified in this sub-section.
(3) Where any excisable goods manufactured at a place of business had been removed
without payment of duty for carrying out tests or any other process not amounting to
manufacture, to any other premises, whether registered or not, in accordance with the
provisions of existing law prior to the appointed day and such goods, are returned to the said
place on or after the appointed day, no tax shall be payable if the said goods, after undergoing
tests or any other process, are returned to the said place within six months from the appointed
day:
Provided that the period of six months may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding two months:
Provided further that if the said goods are not returned within the period specified in
this sub-section, the input tax credit shall be liable to be recovered in accordance with the
provisions of clause (a) of sub-section (8) of section 142:
Provided also that the manufacturer may, in accordance with the provisions of the
existing law, transfer the said goods from the said other premises on payment of tax in India
or without payment of tax for exports within the period specified in this sub-section.
(4) The tax under sub-sections (1), (2) and (3) shall not be payable, only if the
manufacturer and the job worker declare the details of the inputs or goods held in stock by
the job worker on behalf of the manufacturer on the appointed day in such form and manner
and within such time as may be prescribed.
142. (1) Where any goods on which duty, if any, had been paid under the existing law Miscellaneous
at the time of removal thereof, not being earlier than six months prior to the appointed day, are transitional
returned to any place of business on or after the appointed day, the registered person shall provisions.
be eligible for refund of the duty paid under the existing law where such goods are returned
by a person, other than a registered person, to the said place of business within a period of
six months from the appointed day and such goods are identifiable to the satisfaction of the
proper officer:
Provided that if the said goods are returned by a registered person, the return of such
goods shall be deemed to be a supply.
(2) (a) where, in pursuance of a contract entered into prior to the appointed day, the
price of any goods or services or both is revised upwards on or after the appointed day, the
registered person who had removed or provided such goods or services or both shall issue
to the recipient a supplementary invoice or debit note, containing such particulars as may be
prescribed, within thirty days of such price revision and for the purposes of this Act such
supplementary invoice or debit note shall be deemed to have been issued in respect of an
outward supply made under this Act;
(b) where, in pursuance of a contract entered into prior to the appointed day, the price
of any goods or services or both is revised downwards on or after the appointed day, the
registered person who had removed or provided such goods or services or both may issue
to the recipient a credit note, containing such particulars as may be prescribed, within thirty
days of such price revision and for the purposes of this Act such credit note shall be deemed
to have been issued in respect of an outward supply made under this Act:92 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Provided that the registered person shall be allowed to reduce his tax liability on
account of issue of the credit note only if the recipient of the credit note has reduced his
input tax credit corresponding to such reduction of tax liability.
(3) Every claim for refund filed by any person before, on or after the appointed day, for
refund of any amount of CENVAT credit, duty, tax, interest or any other amount paid under
the existing law, shall be disposed of in accordance with the provisions of existing law and
any amount eventually accruing to him shall be paid in cash, notwithstanding anything
to the contrary contained under the provisions of existing law other than the provisions of
sub-section (2) of section 11B of the Central Excise Act, 1944: 1 of 1944.
Provided that where any claim for refund of CENVAT credit is fully or partially rejected,
the amount so rejected shall lapse:
Provided further that no refund shall be allowed of any amount of CENVAT credit
where the balance of the said amount as on the appointed day has been carried forward
under this Act.
(4) Every claim for refund filed after the appointed day for refund of any duty or tax
paid under existing law in respect of the goods or services exported before or after the
appointed day, shall be disposed of in accordance with the provisions of the existing law:
Provided that where any claim for refund of CENVAT credit is fully or partially rejected,
the amount so rejected shall lapse:
Provided further that no refund shall be allowed of any amount of CENVAT credit
where the balance of the said amount as on the appointed day has been carried forward
under this Act.
(5) Every claim filed by a person after the appointed day for refund of tax paid under
the existing law in respect of services not provided shall be disposed of in accordance with
the provisions of existing law and any amount eventually accruing to him shall be paid in
cash, notwithstanding anything to the contrary contained under the provisions of existing
law other than the provisions of sub-section (2) of section 11B of the Central Excise
Act, 1944. 1 of 1944.
(6) (a) every proceeding of appeal, review or reference relating to a claim for CENVAT
credit initiated whether before, on or after the appointed day under the existing law shall be
disposed of in accordance with the provisions of existing law, and any amount of credit
found to be admissible to the claimant shall be refunded to him in cash, notwithstanding
anything to the contrary contained under the provisions of existing law other than the
provisions of sub-section (2) of section 11B of the Central Excise Act, 1944 and the amount 1 of 1944.
rejected, if any, shall not be admissible as input tax credit under this Act:
Provided that no refund shall be allowed of any amount of CENVAT credit where the
balance of the said amount as on the appointed day has been carried forward under
this Act;
(b) every proceeding of appeal, review or reference relating to recovery of CENVAT
credit initiated whether before, on or after the appointed day under the existing law shall be
disposed of in accordance with the provisions of existing law and if any amount of credit
becomes recoverable as a result of such appeal, review or reference, the same shall, unless
recovered under the existing law, be recovered as an arrear of tax under this Act and the
amount so recovered shall not be admissible as input tax credit under this Act.
(7) (a) every proceeding of appeal, review or reference relating to any output duty or
tax liability initiated whether before, on or after the appointed day under the existing law,
shall be disposed of in accordance with the provisions of the existing law, and if anySEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 93
amount becomes recoverable as a result of such appeal, review or reference, the same shall,
unless recovered under the existing law, be recovered as an arrear of duty or tax under this
Act and the amount so recovered shall not be admissible as input tax credit under this
Act.
(b) every proceeding of appeal, review or reference relating to any output duty or tax
liability initiated whether before, on or after the appointed day under the existing law, shall be
disposed of in accordance with the provisions of the existing law, and any amount found to
be admissible to the claimant shall be refunded to him in cash, notwithstanding anything
to the contrary contained under the provisions of existing law other than the provisions of
1 of 1944. sub-section (2) of section 11B of the Central Excise Act, 1944 and the amount rejected, if any,
shall not be admissible as input tax credit under this Act.
(8) (a) where in pursuance of an assessment or adjudication proceedings instituted,
whether before, on or after the appointed day, under the existing law, any amount of tax,
interest, fine or penalty becomes recoverable from the person, the same shall, unless recovered
under the existing law, be recovered as an arrear of tax under this Act and the amount so
recovered shall not be admissible as input tax credit under this Act;
(b) where in pursuance of an assessment or adjudication proceedings instituted, whether
before, on or after the appointed day, under the existing law, any amount of tax, interest, fine
or penalty becomes refundable to the taxable person, the same shall be refunded to him in
cash under the said law, notwithstanding anything to the contrary contained in the said law
1 of 1944. other than the provisions of sub-section (2) of section 11B of the Central Excise Act, 1944
and the amount rejected, if any, shall not be admissible as input tax credit under this Act.
(9) (a) where any return, furnished under the existing law, is revised after the appointed
day and if, pursuant to such revision, any amount is found to be recoverable or any amount
of CENVAT credit is found to be inadmissible, the same shall, unless recovered under the
existing law, be recovered as an arrear of tax under this Act and the amount so recovered shall
not be admissible as input tax credit under this Act;
(b) where any return, furnished under the existing law, is revised after the appointed
day but within the time limit specified for such revision under the existing law and if, pursuant
to such revision, any amount is found to be refundable or CENVAT credit is found to be
admissible to any taxable person, the same shall be refunded to him in cash under the existing
law, notwithstanding anything to the contrary contained in the said law other than the
1 of 1944. provisions of sub-section (2) of section 11B of the Central Excise Act, 1944 and the amount
rejected, if any, shall not be admissible as input tax credit under this Act.
(10) Save as otherwise provided in this Chapter, the goods or services or both supplied
on or after the appointed day in pursuance of a contract entered into prior to the appointed
day shall be liable to tax under the provisions of this Act.
(11) (a) notwithstanding anything contained in section 12, no tax shall be payable on
goods under this Act to the extent the tax was leviable on the said goods under the Value
Added Tax Act of the State;
(b) notwithstanding anything contained in section 13, no tax shall be payable on services
under this Act to the extent the tax was leviable on the said services under Chapter V of the
32 of 1994. Finance Act, 1994;
(c) where tax was paid on any supply both under the Value Added Tax Act and under
32 of 1994. Chapter V of the Finance Act, 1994, tax shall be leviable under this Act and the taxable person
shall be entitled to take credit of value added tax or service tax paid under the existing law to
the extent of supplies made after the appointed day and such credit shall be calculated in
such manner as may be prescribed.94 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(12) Where any goods sent on approval basis, not earlier than six months before the
appointed day, are rejected or not approved by the buyer and returned to the seller on or after
the appointed day, no tax shall be payable thereon if such goods are returned within six
months from the appointed day:
Provided that the said period of six months may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding two months:
Provided further that the tax shall be payable by the person returning the goods if such
goods are liable to tax under this Act, and are returned after a period specified in this
sub-section:
Provided also that tax shall be payable by the person who has sent the goods on
approval basis if such goods are liable to tax under this Act, and are not returned within a
period specified in this sub-section.
(13) Where a supplier has made any sale of goods in respect of which tax was required
to be deducted at source under any law of a State or Union territory relating to Value Added
Tax and has also issued an invoice for the same before the appointed day, no deduction of tax
at source under section 51 shall be made by the deductor under the said section where
payment to the said supplier is made on or after the appointed day.
Explanation.––For the purposes of this Chapter, the expressions “capital goods”,
“Central Value Added Tax (CENVAT) credit”, “first stage dealer”, “second stage dealer”, or
“manufacture” shall have the same meaning as respectively assigned to them in the
1 of 1944.
Central Excise Act, 1944 or the rules made thereunder.
CHAPTER XXI
MISCELLANEOUS
Job work 143. (1) A registered person (hereafter in this section referred to as the “principal”)
procedure. may under intimation and subject to such conditions as may be prescribed, send any inputs
or capital goods, without payment of tax, to a job worker for job work and from there
subsequently send to another job worker and likewise, and shall,––
(a) bring back inputs, after completion of job work or otherwise, or capital goods,
other than moulds and dies, jigs and fixtures, or tools, within one year and three years,
respectively, of their being sent out, to any of his place of business, without payment
of tax;
(b) supply such inputs, after completion of job work or otherwise, or capital
goods, other than moulds and dies, jigs and fixtures, or tools, within one year and three
years, respectively, of their being sent out from the place of business of a job worker
on payment of tax within India, or with or without payment of tax for export, as the case
may be:
Provided that the principal shall not supply the goods from the place of business
of a job worker in accordance with the provisions of this clause unless the said principal
declares the place of business of the job worker as his additional place of business
except in a case—
(i) where the job worker is registered under section 25; or
(ii) where the principal is engaged in the supply of such goods as may be
notified by the Commissioner.
(2) The responsibility for keeping proper accounts for the inputs or capital goods shall
lie with the principal.
(3) Where the inputs sent for job work are not received back by the principal after
completion of job work or otherwise in accordance with the provisions of clause (a) of
sub-section (1) or are not supplied from the place of business of the job worker in accordanceSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 95
with the provisions of clause (b) of sub-section (1) within a period of one year of their being
sent out, it shall be deemed that such inputs had been supplied by the principal to the
job worker on the day when the said inputs were sent out.
(4) Where the capital goods, other than moulds and dies, jigs and fixtures, or tools,
sent for job work are not received back by the principal in accordance with the provisions
of clause (a) of sub-section (1) or are not supplied from the place of business of the job
worker in accordance with the provisions of clause (b) of sub-section (1) within a period of
three years of their being sent out, it shall be deemed that such capital goods had been
supplied by the principal to the job worker on the day when the said capital goods were
sent out.
(5) Notwithstanding anything contained in sub-sections (1) and (2), any waste and
scrap generated during the job work may be supplied by the job worker directly from his
place of business on payment of tax, if such job worker is registered, or by the principal, if the
job worker is not registered.
Explanation.––For the purposes of job work, input includes intermediate goods arising
from any treatment or process carried out on the inputs by the principal or the job worker.
144. Where any document–– Presumption
as to
(i) is produced by any person under this Act or any other law for the time being documents in
certain cases.
in force; or
(ii) has been seized from the custody or control of any person under this Act or
any other law for the time being in force; or
(iii) has been received from any place outside India in the course of any
proceedings under this Act or any other law for the time being in force,
and such document is tendered by the prosecution in evidence against him or any other
person who is tried jointly with him, the court shall—
(a) unless the contrary is proved by such person, presume—
(i) the truth of the contents of such document;
(ii) that the signature and every other part of such document which purports
to be in the handwriting of any particular person or which the court may
reasonably assume to have been signed by, or to be in the handwriting of, any
particular person, is in that person’s handwriting, and in the case of a document
executed or attested, that it was executed or attested by the person by whom it
purports to have been so executed or attested;
(b) admit the document in evidence notwithstanding that it is not duly stamped,
if such document is otherwise admissible in evidence.
145. (1) Notwithstanding anything contained in any other law for the time being in Admissibility
force,— of micro
films,
(a) a micro film of a document or the reproduction of the image or images embodied facsimile
in such micro film (whether enlarged or not); or copies of
documents and
(b) a facsimile copy of a document; or computer
printouts as
(c) a statement contained in a document and included in a printed material documents and
produced by a computer, subject to such conditions as may be prescribed; or as evidence.
(d) any information stored electronically in any device or media, including any
hard copies made of such information,
shall be deemed to be a document for the purposes of this Act and the rules
made thereunder and shall be admissible in any proceedings thereunder, without further96 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
proof or production of the original, as evidence of any contents of the original or of any fact
stated therein of which direct evidence would be admissible.
(2) In any proceedings under this Act or the rules made thereunder, where it is desired
to give a statement in evidence by virtue of this section, a certificate,—
(a) identifying the document containing the statement and describing the manner
in which it was produced;
(b) giving such particulars of any device involved in the production of that
document as may be appropriate for the purpose of showing that the document was
produced by a computer,
shall be evidence of any matter stated in the certificate and for the purposes of this
sub-section it shall be sufficient for a matter to be stated to the best of the knowledge and
belief of the person stating it.
Common 146. The Government may, on the recommendations of the Council, notify the Common
Portal. Goods and Services Tax Electronic Portal for facilitating registration, payment of tax, furnishing
of returns, computation and settlement of integrated tax, electronic way bill and for carrying
out such other functions and for such purposes as may be prescribed.
Deemed 147. The Government may, on the recommendations of the Council, notify certain
exports. supplies of goods as deemed exports, where goods supplied do not leave India, and payment
for such supplies is received either in Indian rupees or in convertible foreign exchange, if
such goods are manufactured in India.
148. The Government may, on the recommendations of the Council, and subject to
Special
procedure for such conditions and safeguards as may be prescribed, notify certain classes of registered
certain persons, and the special procedures to be followed by such persons including those with
processes.
regard to registration, furnishing of return, payment of tax and administration of
such persons.
Goods and 149. (1) Every registered person may be assigned a goods and services tax compliance
services tax rating score by the Government based on his record of compliance with the provisions of
compliance
this Act.
rating.
(2) The goods and services tax compliance rating score may be determined on the
basis of such parameters as may be prescribed.
(3) The goods and services tax compliance rating score may be updated at periodic
intervals and intimated to the registered person and also placed in the public domain in such
manner as may be prescribed.
Obligation to 150. (1) Any person, being—
furnish
(a) a taxable person; or
information
return.
(b) a local authority or other public body or association; or
(c) any authority of the State Government responsible for the collection of value
added tax or sales tax or State excise duty or an authority of the Central Government
responsible for the collection of excise duty or customs duty; or
(d) an income tax authority appointed under the provisions of the Income-tax
Act, 1961; or
43 of 1961.
(e) a banking company within the meaning of clause (a) of section 45A of the
Reserve Bank of India Act, 1934; or 2 of 1934.
(f) a State Electricity Board or an electricity distribution or transmission licensee
under the Electricity Act, 2003, or any other entity entrusted with such functions by 36 of 2003.
the Central Government or the State Government; orSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 97
(g) the Registrar or Sub-Registrar appointed under section 6 of the Registration
16 of 1908. Act, 1908; or
18 of 2013. (h) a Registrar within the meaning of the Companies Act, 2013; or
(i) the registering authority empowered to register motor vehicles under the
59 of 1988. Motor Vehicles Act, 1988; or
(j) the Collector referred to in clause (c) of section 3 of the Right to Fair
Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement
30 of 2013. Act, 2013; or
(k) the recognised stock exchange referred to in clause (f) of section 2 of the
42 of 1956. Securities Contracts (Regulation) Act, 1956; or
(l) a depository referred to in clause (e) of sub-section (1) of section 2 of the
22 of 1996. Depositories Act, 1996; or
(m) an officer of the Reserve Bank of India as constituted under section 3 of the
2 of 1934. Reserve Bank of India Act, 1934; or
(n) the Goods and Services Tax Network, a company registered under the
18 of 2013. Companies Act, 2013; or
(o) a person to whom a Unique Identity Number has been granted under
sub-section (9) of section 25; or
(p) any other person as may be specified, on the recommendations of the Council,
by the Government,
who is responsible for maintaining record of registration or statement of accounts or any
periodic return or document containing details of payment of tax and other details of transaction
of goods or services or both or transactions related to a bank account or consumption of
electricity or transaction of purchase, sale or exchange of goods or property or right or
interest in a property under any law for the time being in force, shall furnish an information
return of the same in respect of such periods, within such time, in such form and manner and
to such authority or agency as may be prescribed.
(2) Where the Commissioner, or an officer authorised by him in this behalf, considers
that the information furnished in the information return is defective, he may intimate the
defect to the person who has furnished such information return and give him an opportunity
of rectifying the defect within a period of thirty days from the date of such intimation or
within such further period which, on an application made in this behalf, the said authority
may allow and if the defect is not rectified within the said period of thirty days or, the further
period so allowed, then, notwithstanding anything contained in any other provisions of this
Act, such information return shall be treated as not furnished and the provisions of this Act
shall apply.
(3) Where a person who is required to furnish information return has not furnished the
same within the time specified in sub-section (1) or sub-section (2), the said authority may
serve upon him a notice requiring furnishing of such information return within a period not
exceeding ninety days from the date of service of the notice and such person shall furnish
the information return.
151. (1) The Commissioner may, if he considers that it is necessary so to do, by Power to
notification, direct that statistics may be collected relating to any matter dealt with by or in collect
statistics.
connection with this Act.
(2) Upon such notification being issued, the Commissioner, or any person authorised
by him in this behalf, may call upon the concerned persons to furnish such information or
returns, in such form and manner as may be prescribed, relating to any matter in respect of
which statistics is to be collected .98 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Bar on 152. (1) No information of any individual return or part thereof with respect to any
disclosure of matter given for the purposes of section 150 or section 151 shall, without the previous
information.
consent in writing of the concerned person or his authorised representative, be published in
such manner so as to enable such particulars to be identified as referring to a particular person
and no such information shall be used for the purpose of any proceedings under this Act.
(2) Except for the purposes of prosecution under this Act or any other Act for the time
being in force, no person who is not engaged in the collection of statistics under this Act or
compilation or computerisation thereof for the purposes of this Act, shall be permitted to see
or have access to any information or any individual return referred to in section 151.
(3) Nothing in this section shall apply to the publication of any information relating to
a class of taxable persons or class of transactions, if in the opinion of the Commissioner, it is
desirable in the public interest to publish such information.
Taking 153. Any officer not below the rank of Assistant Commissioner may, having regard to
assistance the nature and complexity of the case and the interest of revenue, take assistance of any
from an
expert at any stage of scrutiny, inquiry, investigation or any other proceedings before him.
expert.
Power to take 154. The Commissioner or an officer authorised by him may take samples of goods
samples. from the possession of any taxable person, where he considers it necessary, and provide a
receipt for any samples so taken.
Burden of 155. Where any person claims that he is eligible for input tax credit under this Act, the
proof. burden of proving such claim shall lie on such person.
Persons 156. All persons discharging functions under this Act shall be deemed to be public
deemed to be servants within the meaning of section 21 of the Indian Penal Code. 45 of 1860.
public servants.
Protection of 157. (1) No suit, prosecution or other legal proceedings shall lie against the President,
action taken State President, Members, officers or other employees of the Appellate Tribunal or any other
under this Act.
person authorised by the said Appellate Tribunal for anything which is in good faith done or
intended to be done under this Act or the rules made thereunder.
(2) No suit, prosecution or other legal proceedings shall lie against any officer appointed
or authorised under this Act for anything which is done or intended to be done in good faith
under this Act or the rules made thereunder.
Disclosure of 158. (1) All particulars contained in any statement made, return furnished or accounts
information or documents produced in accordance with this Act, or in any record of evidence given in the
by a public course of any proceedings under this Act (other than proceedings before a criminal court), or
servant.
in any record of any proceedings under this Act shall, save as provided in sub-section (3),
not be disclosed.
(2) Notwithstanding anything contained in the Indian Evidence Act, 1872, no court 1 of 1872.
shall, save as otherwise provided in sub-section (3), require any officer appointed or authorised
under this Act to produce before it or to give evidence before it in respect of particulars
referred to in sub-section (1).
(3) Nothing contained in this section shall apply to the disclosure of,––
(a) any particulars in respect of any statement, return, accounts, documents,
evidence, affidavit or deposition, for the purpose of any prosecution under the Indian
Penal Code or the Prevention of Corruption Act, 1988, or any other law for the time 45 of 1860.
being in force; or 49 of 1988.
(b) any particulars to the Central Government or the State Government or to any
person acting in the implementation of this Act, for the purposes of carrying out the
objects of this Act; or
(c) any particulars when such disclosure is occasioned by the lawful exercise under
this Act of any process for the service of any notice or recovery of any demand; orSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 99
(d) any particulars to a civil court in any suit or proceedings, to which the
Government or any authority under this Act is a party, which relates to any matter
arising out of any proceedings under this Act or under any other law for the time being
in force authorising any such authority to exercise any powers thereunder; or
(e) any particulars to any officer appointed for the purpose of audit of tax receipts
or refunds of the tax imposed by this Act; or
(f) any particulars where such particulars are relevant for the purposes of any
inquiry into the conduct of any officer appointed or authorised under this Act, to any
person or persons appointed as an inquiry officer under any law for the time being in
force; or
(g) any such particulars to an officer of the Central Government or of any State
Government, as may be necessary for the purpose of enabling that Government to levy
or realise any tax or duty; or
(h) any particulars when such disclosure is occasioned by the lawful exercise by
a public servant or any other statutory authority, of his or its powers under any law for
the time being in force; or
(i) any particulars relevant to any inquiry into a charge of misconduct in
connection with any proceedings under this Act against a practising advocate, a tax
practitioner, a practising cost accountant, a practising chartered accountant, a practising
company secretary to the authority empowered to take disciplinary action against the
members practising the profession of a legal practitioner, a cost accountant, a chartered
accountant or a company secretary, as the case may be; or
(j) any particulars to any agency appointed for the purposes of data entry on
any automated system or for the purpose of operating, upgrading or maintaining any
automated system where such agency is contractually bound not to use or disclose
such particulars except for the aforesaid purposes; or
(k) any particulars to an officer of the Government as may be necessary for the
purposes of any other law for the time being in force; or
(l) any information relating to any class of taxable persons or class of transactions
for publication, if, in the opinion of the Commissioner, it is desirable in the public
interest, to publish such information.
159. (1) If the Commissioner, or any other officer authorised by him in this behalf, is of Publication of
the opinion that it is necessary or expedient in the public interest to publish the name of any information
in respect of
person and any other particulars relating to any proceedings or prosecution under this Act
persons in
in respect of such person, it may cause to be published such name and particulars in such certain cases.
manner as it thinks fit.
(2) No publication under this section shall be made in relation to any penalty imposed
under this Act until the time for presenting an appeal to the Appellate Authority under
section 107 has expired without an appeal having been presented or the appeal, if presented,
has been disposed of.
Explanation.––In the case of firm, company or other association of persons, the
names of the partners of the firm, directors, managing agents, secretaries and treasurers or
managers of the company, or the members of the association, as the case may be, may also be
published if, in the opinion of the Commissioner, or any other officer authorised by him in
this behalf, circumstances of the case justify it.
160. (1) No assessment, re-assessment, adjudication, review, revision, appeal, Assessment
proceedings,
rectification, notice, summons or other proceedings done, accepted, made, issued, initiated,
etc., not to be
or purported to have been done, accepted, made, issued, initiated in pursuance of any of the
invalid on
provisions of this Act shall be invalid or deemed to be invalid merely by reason of any certain
grounds.100 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
mistake, defect or omission therein, if such assessment, re-assessment, adjudication, review,
revision, appeal, rectification, notice, summons or other proceedings are in substance and
effect in conformity with or according to the intents, purposes and requirements of this Act
or any existing law.
(2) The service of any notice, order or communication shall not be called in question,
if the notice, order or communication, as the case may be, has already been acted upon by the
person to whom it is issued or where such service has not been called in question at or in the
earlier proceedings commenced, continued or finalised pursuant to such notice, order or
communication.
Rectification 161. Without prejudice to the provisions of section 160, and notwithstanding anything
of errors contained in any other provisions of this Act, any authority, who has passed or issued any
apparent on
decision or order or notice or certificate or any other document, may rectify any error which
the face of
record. is apparent on the face of record in such decision or order or notice or certificate or any other
document, either on its own motion or where such error is brought to its notice by any officer
appointed under this Act or an officer appointed under the State Goods and Services Tax Act
or an officer appointed under the Union Territory Goods and Services Tax Act or by the
affected person within a period of three months from the date of issue of such decision or
order or notice or certificate or any other document, as the case may be:
Provided that no such rectification shall be done after a period of six months from the
date of issue of such decision or order or notice or certificate or any other document:
Provided further that the said period of six months shall not apply in such cases where
the rectification is purely in the nature of correction of a clerical or arithmetical error, arising
from any accidental slip or omission:
Provided also that where such rectification adversely affects any person, the principles
of natural justice shall be followed by the authority carrying out such rectification.
Bar on 162. Save as provided in sections 117 and 118, no civil court shall have jurisdiction to
jurisdiction of deal with or decide any question arising from or relating to anything done or purported to be
civil courts.
done under this Act.
Levy of fee. 163. Wherever a copy of any order or document is to be provided to any person on an
application made by him for that purpose, there shall be paid such fee as may be prescribed.
Power of 164. (1) The Government may, on the recommendations of the Council, by notification,
Government make rules for carrying out the provisions of this Act.
to make rules.
(2) Without prejudice to the generality of the provisions of sub-section (1), the
Government may make rules for all or any of the matters which by this Act are required to be,
or may be, prescribed or in respect of which provisions are to be or may be made by rules.
(3) The power to make rules conferred by this section shall include the power to give
retrospective effect to the rules or any of them from a date not earlier than the date on which
the provisions of this Act come into force.
(4) Any rules made under sub-section (1) or sub-section (2) may provide that a
contravention thereof shall be liable to a penalty not exceeding ten thousand rupees.
Power to make 165. The Board may, by notification, make regulations consistent with this Act and the
regulations. rules made thereunder to carry out the provisions of this Act.
Laying of 166. Every rule made by the Government, every regulation made by the Board and
rules,
every notification issued by the Government under this Act, shall be laid, as soon as may be
regulations
after it is made or issued, before each House of Parliament, while it is in session, for a total
and
notifications. period of thirty days which may be comprised in one session or in two or more successive
sessions, and if, before the expiry of the session immediately following the session or theSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 101
successive sessions aforesaid, both Houses agree in making any modification in the rule or
regulation or in the notification, as the case may be, or both Houses agree that the rule or
regulation or the notification should not be made, the rule or regulation or notification, as the
case may be, shall thereafter have effect only in such modified form or be of no effect, as the
case may be; so, however, that any such modification or annulment shall be without prejudice
to the validity of anything previously done under that rule or regulation or notification, as
the case may be.
167. The Commissioner may, by notification, direct that subject to such conditions, if Delegation of
any, as may be specified in the notification, any power exercisable by any authority or officer powers.
under this Act may be exercisable also by another authority or officer as may be specified in
such notification.
168. (1) The Board may, if it considers it necessary or expedient so to do for the
Power to issue
purpose of uniformity in the implementation of this Act, issue such orders, instructions or instructions or
directions to the central tax officers as it may deem fit, and thereupon all such officers and all directions.
other persons employed in the implementation of this Act shall observe and follow such
orders, instructions or directions.
(2) The Commissioner specified in clause (91) of section 2, sub-section (3) of
section 5, clause (b) of sub-section (9) of section 25, sub-sections (3) and (4) of
section 35, sub-section (1) of section 37, sub-section (2) of section 38, sub-section (6)
of section 39, sub-section (5) of section 66, sub-section (1) of section 143, sub-section
(1) of section 151, clause (l) of sub-section (3) of section 158 and section 167 shall mean
a Commissioner or Joint Secretary posted in the Board and such Commissioner or Joint
Secretary shall exercise the powers specified in the said sections with the approval of
the Board.
169. (1) Any decision, order, summons, notice or other communication under this Service of
Act or the rules made thereunder shall be served by any one of the following methods, notice in
namely:— certain
circumstances.
(a) by giving or tendering it directly or by a messenger including a courier to
the addressee or the taxable person or to his manager or authorised representative or
an advocate or a tax practitioner holding authority to appear in the proceedings on
behalf of the taxable person or to a person regularly employed by him in connection
with the business, or to any adult member of family residing with the taxable person;
or
(b) by registered post or speed post or courier with acknowledgement due, to
the person for whom it is intended or his authorised representative, if any, at his last
known place of business or residence; or
(c) by sending a communication to his e-mail address provided at the time of
registration or as amended from time to time; or
(d) by making it available on the common portal; or
(e) by publication in a newspaper circulating in the locality in which the taxable
person or the person to whom it is issued is last known to have resided, carried on
business or personally worked for gain; or
(f) if none of the modes aforesaid is practicable, by affixing it in some conspicuous
place at his last known place of business or residence and if such mode is not practicable
for any reason, then by affixing a copy thereof on the notice board of the office of the
concerned officer or authority who or which passed such decision or order or issued
such summons or notice.
(2) Every decision, order, summons, notice or any communication shall be deemed to
have been served on the date on which it is tendered or published or a copy thereof is affixed
in the manner provided in sub-section (1).102 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(3) When such decision, order, summons, notice or any communication is sent by
registered post or speed post, it shall be deemed to have been received by the addressee at
the expiry of the period normally taken by such post in transit unless the contrary is proved.
Rounding off 170. The amount of tax, interest, penalty, fine or any other sum payable, and the
of tax, etc. amount of refund or any other sum due, under the provisions of this Act shall be rounded off
to the nearest rupee and, for this purpose, where such amount contains a part of a rupee
consisting of paise, then, if such part is fifty paise or more, it shall be increased to one rupee
and if such part is less than fifty paise it shall be ignored.
Anti- 171. (1) Any reduction in rate of tax on any supply of goods or services or the benefit
profiteering of input tax credit shall be passed on to the recipient by way of commensurate reduction in
measure.
prices.
(2) The Central Government may, on recommendations of the Council, by notification,
constitute an Authority, or empower an existing Authority constituted under any law for the
time being in force, to examine whether input tax credits availed by any registered person or
the reduction in the tax rate have actually resulted in a commensurate reduction in the price
of the goods or services or both supplied by him.
(3) The Authority referred to in sub-section (2) shall exercise such powers and discharge
such functions as may be prescribed.
Removal of 172. (1) If any difficulty arises in giving effect to any provisions of this Act, the
difficulties. Government may, on the recommendations of the Council, by a general or a special order
published in the Official Gazette, make such provisions not inconsistent with the provisions
of this Act or the rules or regulations made thereunder, as may be necessary or expedient for
the purpose of removing the said difficulty:
Provided that no such order shall be made after the expiry of a period of three years
from the date of commencement of this Act.
(2) Every order made under this section shall be laid, as soon as may be, after it is made,
before each House of Parliament.
Amendment 173. Save as otherwise provided in this Act, Chapter V of the Finance Act, 1994 shall
of Act 32 of be omitted.
1994.
Repeal and 174. (1) Save as otherwise provided in this Act, on and from the date of commencement
saving. of this Act, the Central Excise Act, 1944 (except as respects goods included in entry 84 of 1 of 1944.
the Union List of the Seventh Schedule to the Constitution), the Medicinal and Toilet
Preparations (Excise Duties) Act, 1955, the Additional Duties of Excise (Goods of Special 16 of 1955.
Importance) Act, 1957, the Additional Duties of Excise (Textiles and Textile Articles) 58 of 1957.
Act, 1978, and the Central Excise Tariff Act, 1985 (hereafter referred to as the repealed Acts) 40 of 1978.
are hereby repealed. 5 of 1986.
(2) The repeal of the said Acts and the amendment of the Finance Act, 1994 (hereafter 32 of 1994.
referred to as “such amendment” or “amended Act”, as the case may be) to the extent
mentioned in the sub-section (1) or section 173 shall not—
(a) revive anything not in force or existing at the time of such amendment or
repeal; or
(b) affect the previous operation of the amended Act or repealed Acts and orders
or anything duly done or suffered thereunder; or
(c) affect any right, privilege, obligation, or liability acquired, accrued or incurred
under the amended Act or repealed Acts or orders under such repealed or amended
Acts:SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 103
Provided that any tax exemption granted as an incentive against investment
through a notification shall not continue as privilege if the said notification is rescinded
on or after the appointed day; or
(d) affect any duty, tax, surcharge, fine, penalty, interest as are due or may
become due or any forfeiture or punishment incurred or inflicted in respect of any
offence or violation committed against the provisions of the amended Act or repealed
Acts; or
(e) affect any investigation, inquiry, verification (including scrutiny and audit),
assessment proceedings, adjudication and any other legal proceedings or recovery of
arrears or remedy in respect of any such duty, tax, surcharge, penalty, fine, interest,
right, privilege, obligation, liability, forfeiture or punishment, as aforesaid, and any
such investigation, inquiry, verification (including scrutiny and audit), assessment
proceedings, adjudication and other legal proceedings or recovery of arrears or remedy
may be instituted, continued or enforced, and any such tax, surcharge, penalty, fine,
interest, forfeiture or punishment may be levied or imposed as if these Acts had not
been so amended or repealed;
(f) affect any proceedings including that relating to an appeal, review or reference,
instituted before on, or after the appointed day under the said amended Act or repealed
Acts and such proceedings shall be continued under the said amended Act or repealed
Acts as if this Act had not come into force and the said Acts had not been amended or
repealed.
(3) The mention of the particular matters referred to in sub-sections (1) and (2) shall
not be held to prejudice or affect the general application of section 6 of the General Clauses
10 of 1897. Act, 1897 with regard to the effect of repeal.104 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
SCHEDULE I
[See section 7]
ACTIVITIES TO BE TREATED AS SUPPLY EVEN IF MADE WITHOUT CONSIDERATION
1. Permanent transfer or disposal of business assets where input tax credit has been
availed on such assets.
2. Supply of goods or services or both between related persons or between distinct
persons as specified in section 25, when made in the course or furtherance of business:
Provided that gifts not exceeding fifty thousand rupees in value in a financial year by
an employer to an employee shall not be treated as supply of goods or services or both.
3. Supply of goods—
(a) by a principal to his agent where the agent undertakes to supply such goods
on behalf of the principal; or
(b) by an agent to his principal where the agent undertakes to receive such
goods on behalf of the principal.
4. Import of services by a taxable person from a related person or from any of his other
establishments outside India, in the course or furtherance of business.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 105
SCHEDULE II
[See Section 7]
ACTIVITIES TO BE TREATED AS SUPPLY OF GOODS OR SUPPLY OF SERVICES
1. Transfer
(a) any transfer of the title in goods is a supply of goods;
(b) any transfer of right in goods or of undivided share in goods without the
transfer of title thereof, is a supply of services;
(c) any transfer of title in goods under an agreement which stipulates that property
in goods shall pass at a future date upon payment of full consideration as agreed, is a
supply of goods.
2. Land and Building
(a) any lease, tenancy, easement, licence to occupy land is a supply of services;
(b) any lease or letting out of the building including a commercial, industrial or
residential complex for business or commerce, either wholly or partly, is a supply of
services.
3. Treatment or process
Any treatment or process which is applied to another person's goods is a supply of services.
4. Transfer of business assets
(a) where goods forming part of the assets of a business are transferred or
disposed of by or under the directions of the person carrying on the business so as no
longer to form part of those assets, whether or not for a consideration, such transfer or
disposal is a supply of goods by the person;
(b) where, by or under the direction of a person carrying on a business, goods
held or used for the purposes of the business are put to any private use or are used, or
made available to any person for use, for any purpose other than a purpose of the
business, whether or not for a consideration, the usage or making available of such
goods is a supply of services;
(c) where any person ceases to be a taxable person, any goods forming part of
the assets of any business carried on by him shall be deemed to be supplied by him in
the course or furtherance of his business immediately before he ceases to be a taxable
person, unless—
(i) the business is transferred as a going concern to another person; or
(ii) the business is carried on by a personal representative who is deemed
to be a taxable person.
5. Supply of services
The following shall be treated as supply of services, namely:—
(a) renting of immovable property;
(b) construction of a complex, building, civil structure or a part thereof,
including a complex or building intended for sale to a buyer, wholly or partly,
except where the entire consideration has been received after issuance of completion
certificate, where required, by the competent authority or after its first occupation,
whichever is earlier.106 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Explanation.—For the purposes of this clause—
(1) the expression "competent authority" means the Government or any
authority authorised to issue completion certificate under any law for the time
being in force and in case of non-requirement of such certificate from such
authority, from any of the following, namely:—
(i) an architect registered with the Council of Architecture constituted
under the Architects Act, 1972; or 20 of 1972.
(ii) a chartered engineer registered with the Institution of Engineers
(India); or
(iii) a licensed surveyor of the respective local body of the city or
town or village or development or planning authority;
(2) the expression "construction" includes additions, alterations,
replacements or remodelling of any existing civil structure;
(c) temporary transfer or permitting the use or enjoyment of any intellectual
property right;
(d) development, design, programming, customisation, adaptation, upgradation,
enhancement, implementation of information technology software;
(e) agreeing to the obligation to refrain from an act, or to tolerate an act or a
situation, or to do an act; and
(f) transfer of the right to use any goods for any purpose (whether or not for a
specified period) for cash, deferred payment or other valuable consideration.
6. Composite supply
The following composite supplies shall be treated as a supply of services, namely:—
(a) works contract as defined in clause (119) of section 2; and
(b) supply, by way of or as part of any service or in any other manner whatsoever,
of goods, being food or any other article for human consumption or any drink (other
than alcoholic liquor for human consumption), where such supply or service is for
cash, deferred payment or other valuable consideration.
7. Supply of Goods
The following shall be treated as supply of goods, namely:—
Supply of goods by any unincorporated association or body of persons to a member
thereof for cash, deferred payment or other valuable consideration.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 107
SCHEDULE III
[See section 7]
ACTIVITIES OR TRANSACTIONS WHICH SHALL BE TREATED NEITHER AS A SUPPLY OF GOODS
NOR A SUPPLY OF SERVICES
1. Services by an employee to the employer in the course of or in relation to his
employment.
2. Services by any court or Tribunal established under any law for the time being in
force.
3. (a) the functions performed by the Members of Parliament, Members of State
Legislature, Members of Panchayats, Members of Municipalities and Members of other
local authorities;
(b) the duties performed by any person who holds any post in pursuance of the
provisions of the Constitution in that capacity; or
(c) the duties performed by any person as a Chairperson or a Member or a
Director in a body established by the Central Government or a State Government or
local authority and who is not deemed as an employee before the commencement of
this clause.
4. Services of funeral, burial, crematorium or mortuary including transportation of the
deceased.
5. Sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building.
6. Actionable claims, other than lottery, betting and gambling.
Explanation.—For the purposes of paragraph 2, the term "court" includes District
Court, High Court and Supreme Court.108 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
STATEMENT OF OBJECTS AND REASONS
Presently, the Central Government levies tax on, manufacture of certain goods in
the form of Central Excise duty, provision of certain services in the form of service tax,
and on inter-State sale of goods in the form of Central Sales tax. Similarly, the State
Governments levy tax, on retail sales in the form of value added tax, entry of goods in
the State in the form of entry tax, luxury tax and purchase tax, etc. Accordingly, there is
multiplicity of taxes which are being levied on the same supply chain.
2. The present tax system on goods and services is facing certain difficulties as
under—
(i) there is cascading of taxes as taxes levied by the Central Government are
not available as set off against the taxes being levied by the State Governments;
(ii) certain taxes levied by the State Governments are not allowed as set off
for payment of other taxes being levied by them;
(iii) the variety of Value Added Tax Laws in the country with disparate tax
rates and dissimilar tax practices divides the country into separate economic
spheres; and
(iv) the creation of tariff and non-tariff barriers such as octroi, entry tax,
check posts, etc., hinder the free flow of trade throughout the country. Besides
that, the large number of taxes create high compliance cost for the tax payers in
the form of number of returns, payments, etc.
3. In view of the aforesaid difficulties, all the above mentioned taxes are proposed
to be subsumed in a single tax called the goods and services tax which will be levied on
supply of goods or services or both at each stage of supply chain starting from
manufacture or import and till the last retail level. So, any tax that is presently being
levied by the Central Government or the State Governments on the supply of goods or
services is going to be converged in goods and services tax which is proposed to be a
dual levy where the Central Government will levy and collect tax in the form of central
goods and services tax and the State Government will levy and collect tax in the form of
state goods and services tax on intra-State supply of goods or services or both.
4. In view of the above, it has become necessary to have a Central legislation,
namely the Central Goods and Services Tax Bill, 2017. The proposed legislation will
confer power upon the Central Government for levying goods and services tax on the
supply of goods or services or both which takes place within a State. The proposed
legislation will simplify and harmonise the indirect tax regime in the country. It is
expected to reduce cost of production and inflation in the economy, thereby making the
Indian trade and industry more competitive, domestically as well as internationally.
Due to the seamless transfer of input tax credit from one stage to another in the chain of
value addition, there is an in-built mechanism in the design of goods and services tax
that would incentivise tax compliance by tax payers. The proposed goods and services
tax will broaden the tax base, and result in better tax compliance due to a robust
information technology infrastructure.
5. The Central Goods and Services Tax Bill, 2017, inter alia, provides for the
following, namely:—
(a) to levy tax on all intra-State supplies of goods or services or both except
supply of alcoholic liquor for human consumption at a rate to be notified, not
exceeding twenty per cent. as recommended by the Goods and Services Tax Council
(the Council);SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 109
(b) to broad base the input tax credit by making it available in respect of
taxes paid on any supply of goods or services or both used or intended to be
used in the course or furtherance of business;
(c) to impose obligation on electronic commerce operators to collect tax at
source, at such rate not exceeding one per cent. of net value of taxable supplies,
out of payments to suppliers supplying goods or services through their portals;
(d) to provide for self-assessment of the taxes payable by the registered
person;
(e) to provide for conduct of audit of registered persons in order to verify
compliance with the provisions of the Act;
(f) to provide for recovery of arrears of tax using various modes including
detaining and sale of goods, movable and immovable property of defaulting taxable
person;
(g) to provide for powers of inspection, search, seizure and arrest to the
officers;
(h) to establish the Goods and Services Tax Appellate Tribunal by the Central
Government for hearing appeals against the orders passed by the Appellate
Authority or the Revisional Authority;
(i) to make provision for penalties for contravention of the provisions of the
proposed Legislation;
(j) to provide for an anti-profiteering clause in order to ensure that business
passes on the benefit of reduced tax incidence on goods or services or both to the
consumers; and
(k) to provide for elaborate transitional provisions for smooth transition of
existing tax payers to goods and services tax regime.
6. The Notes on clauses explain in detail the various provisions contained in the
Central Goods and Services Tax Bill, 2017.
7. The Bill seeks to achieve the above objectives.
NEW DELHI; ARUN JAITLEY.
The 23rd March, 2017.110 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Notes on clauses
Clause 1 provides for short title, extent and commencement of the proposed Act.
Clause 2 defines various terms and expressions used in the proposed Act.
Clause 3 provides for appointment of Commissioners and other class of officers
as may be required for carrying out the purposes of the proposed Act. This clause also
provides that the officers under the Central Excise Act, 1944 shall be deemed to be the
officers appointed under the proposed Act.
Clause 4 provides for appointment of officers in addition to the officers appointed
under clause 3 of the proposed legislation.
Clause 5 provides for powers to officers to discharge functions under the proposed
Act.
Clause 6 provides for authorisation of State tax and Union territory tax officers,
subject to such conditions as shall be notified by the Central Government on
recommendations of the Council, to be proper officers for the purposes of the proposed
Act.
Clause 7 provides the scope of supply. This clause provides for activities to be
treated as supply. This clause further provides that certain activities, specified in
Schedule I of the proposed Act, even made or agreed to be made without a consideration
shall be treated as supply. This clause also provides activities which are neither supply
of goods nor supply of services.
Clause 8 provides for the tax liability on a composite or a mixed supply.
Clause 9 provides for levy and collection of central tax on all intra-State supplies
of goods or services or both except on the supply of alcoholic liquor for human
consumption, on the value determined under clause 15 at a rate not exceeding forty
per cent. This clause further provides that—
(i) central tax on the supply of petroleum crude, high speed diesel, motor
spirit (commonly known as petrol), natural gas and aviation turbine fuel to be
levied with effect from a date notified by the Central Government on the
recommendations of the Council;
(ii) the Central Government to notify categories of supply of goods or
services or both, the tax on which shall be paid on reverse charge basis by the
recipient of such goods or services or both, on the recommendations of the
Council;
(iii) the central tax in respect of the supply of taxable goods or services or
both by a supplier, who is not registered, to a registered person shall be paid by
such person on reverse charge basis;
(iv) the Central Government may notify categories of services, the tax on
intra-State supplies of which shall be paid by the electronic commerce operator if
such services are supplied through it, on the recommendations of the Council.
Clause 10 provides for composition levy. It is an alternative method of levy of tax
designed for small tax payers whose turnover is up to prescribed limit. This clause also
provides that certain categories of supplies or suppliers cannot opt for composition
levy. A person opting to pay under this clause can neither take credit of taxes paid on
inputs nor it can collect any tax from the recipient.
Clause 11 confers powers on the Central Government to exempt either absolutely
or conditionally goods or services or both of any specified description from the wholeSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 111
or part of the central tax, on the recommendations of the Council. It also confers powers
on the Central Government to exempt from payment of tax any goods or services or
both, by special order, on the recommendations of the Council.
Clause 12 provides for time of supply of goods. This clause extensively elaborates
time of supply in normal situations, in reverse charge situations, in situations of supply
of voucher and remainder situations.
Clause 13 provides for time of supply of services. This clause extensively
elaborates time of supply in normal situations, in reverse charge situations, in situations
of supply of voucher and remainder situations.
Clause 14 provides for time of supply of goods or services or both where rate of
tax changes.
Clause 15 provides for value of taxable supply. This clause provides that the
value of a supply of goods or services or both shall be the transaction value, which is
the price actually paid or payable given the conditions that the supplier and the recipient
of the supply are not related and the price is the sole consideration for the supply. This
clause enumerates the items which are to be included in the value and the items which
are not to be included in the value for the purpose of calculation of tax. This clause also
provides power to make rules of valuation in certain situations.
Clause 16 provides for eligibility, conditions and time period for taking input tax
credit. This clause provides that a registered person is entitled to take credit of input
tax charged on any supply of goods or services or both to him which are used or
intended to be used in the course or furtherance of his business.
Clause 17 provides for apportionment of input tax credit and blocked input tax
credit. This clause provides for the extent of apportionment of credit where the goods
or services or both are used partly for the purpose of any business and partly for other
purposes or where the goods or services or both are used by the registered person
partly for effecting taxable supplies including zero-rated supplies. This clause further
provides for a specific mechanism of taking of input tax credit by a banking company or
a financial institution including a non-banking financial company engaged in supplying
services by way of accepting deposits, extending loans or advances. This clause also
provides the list of supplies on which input tax credit cannot be availed of.
Clause 18 provides for availability of credit in special circumstances like new
registration, shifting from composition levy to normal levy, exempted supplies becoming
taxable and vice versa.
Clause 19 provides for special provision for taking input tax credit by a person
(called "principal") who has sent inputs or capital goods for job work subject to
prescribed conditions.
Clause 20 provides for an "Input Service Distributor" who shall distribute the
credit of input tax in prescribed manner and subject to specified conditions.
Clause 21 provides for manner of recovery of excess input tax credit distributed
by the Input Service Distributor along with interest thereon.
Clause 22 seeks to create liability for registration on every supplier in the State or
Union territory from where he makes a taxable supply of goods or services or both, if
his aggregate turnover in a financial year exceeds prescribed amount. This clause creates
liability for registration under the proposed Act with effect from the appointed day on
every person who is registered under an existing law.
Clause 23 provides that certain categories of persons are not liable for registration.112 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Clause 24 provides for compulsory registration of certain suppliers
notwithstanding that their aggregate turnover is below the exempted threshold provided
in clause 22.
Clause 25 provides for procedure of registration. This clause provides that every
person who is liable to be registered shall apply for registration in every such State or
Union territory in which he is so liable within thirty days from the date on which he
becomes liable to registration. This clause further provides that a casual taxable person
or a non-resident taxable person shall apply for registration at least five days prior to
the commencement of business. This clause also provides that every person who makes
a supply from the territorial waters of India shall obtain registration in the coastal State
or Union territory where the nearest point of the appropriate base line is located. This
clause also provides for voluntary registration. This clause also provides that certain
organisations would be issued Unique Identity Number mainly for the purpose of refund
of taxes paid on inward supplies.
Clause 26 provides for deemed registration or rejection of application for
registration under the proposed Act where registration number or Unique Identity
Number has been issued or rejected under States Goods and Services Tax Act.
Clause 27 provides for special provisions for a casual taxable person and a
non-resident taxable person.
Clause 28 provides for amendment of registration. This clause also provides for
deemed approval or rejection of amendment where any approval or rejection of
amendments has been done under the State Goods and Services Tax Act or the Union
Territory Goods and Services Tax Act.
Clause 29 provides that the proper officer may, either on his own motion or on an
application filed by the registered person or by his legal heirs, in case of death of such
person, cancel the registration under certain specified circumstances. This clause further
provides that cancellation of registration under the State Goods and Services Tax Act
or the Union Territory Goods and Services Tax Act, as the case may be, shall be deemed
to be a cancellation of registration under the proposed Act.
Clause 30 provides for revocation of cancellation of registration where the
registration had been cancelled by the proper officer on his own motion. This clause
further provides that the revocation of cancellation of registration under the State
Goods and Services Tax Act or the Union Territory Goods and Services Tax Act, as the
case may be, shall be deemed to be a revocation of cancellation of registration under
the proposed Act.
Clause 31 provides for issuance of tax invoice within the prescribed period
showing the prescribed particulars. This clause also empowers the Government to
specify services, for which any other document issued in lieu of tax invoice, shall be
deemed to be tax invoice and also specify services where no tax invoice is required to
be issued. This clause provides for issue of documents other than tax invoice in certain
cases.
Clause 32 prohibits an unregistered person to collect tax. This clause also provides
that a registered person shall collect tax in accordance with the provisions of the
proposed Act.
Clause 33 provides that where any supply is made for a consideration, every
person who is liable to pay tax for such supply shall prominently indicate the amount of
tax forming part of the price in all documents relating to assessment, tax invoice and
other like documents.
Clause 34 provides for issuance of a credit notes and debit notes in specified
situations. This clause also provides for maximum time and return in which details of
credit note and debit note are required to be declared.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 113
Clause 35 provides that every registered person shall keep and maintain at his
principal place of business records showing true account of specified particulars. This
clause casts responsibility on owner or operator of warehouse or godown or any other
place used for storage of goods and on every transporter to maintain specified records.
This clause empowers the Commissioner to notify a class of taxable persons to maintain
additional accounts or documents for specified purpose or to maintain accounts in
other prescribed manner. This clause provides that every registered person whose
turnover during a financial year exceeds the prescribed limit shall get his accounts
audited by a chartered accountant or a cost accountant.
Clause 36 requires every registered person to retain books of account or other
records until the expiry of seventy-two months from the due date of furnishing of
annual return for the year pertaining to such accounts and records.
Clause 37 provides for the manner and time of furnishing of the details of outward
supplies by a registered person, other than certain specified categories of registered
persons, and manner and time of communication of these details to the corresponding
recipients.This clause further provides for manner and time of acceptance or rejection
of the details communicated from the recipients. This clause also provides for manner
of and time period for rectification of error or omission and payment of tax and interest,
if any, as a consequence of the unmatched details of outward supplies with inward
supplies of the recipient.
Clause 38 provides for the manner and time of furnishing of the details of inward
supplies by a registered person, other than certain specified categories of registered
persons, including verification, validation, modification or deletion of details of outward
supplies furnished by the corresponding suppliers. This clause further provides for
manner and time of communication of the details of supplies, as modified or accepted
by the recipient, to the corresponding supplier. This clause also provides for the manner
and time period for rectification of error or omission and payment of tax and interest, if
any, as a consequence to the unmatched details.
Clause 39 provides for the manner, conditions and time of furnishing of returns
by different categories of registered persons. This clause further provides that the tax
is required to be paid by the due date of filing of return. This clause also provides for
the time limit up to which rectification of any omission or incorrect particulars in the
return can be carried out.
Clause 40 provides that every registered person who has made outward supplies
in the period between the date on which he became liable to registration till the date on
which registration has been granted shall declare the same in the first return furnished
by him after grant of registration.
Clause 41 provides that every registered person shall be entitled to provisionally
take the credit of eligible input tax subject to prescribed conditions and restrictions.
This clause further provides that the credit taken on provisional basis shall be utilised
only for payment of output tax self-assessed in the return in which the credit on
provisional basis is taken.
Clause 42 provides for matching, in prescribed time and manner, of details of
inward supplies furnished by a recipient for a tax period with the corresponding details.
This clause also provides for the consequences of mis-match.
Clause 43 provides for matching, in prescribed time and manner, of details of
every credit note relating to outward supply furnished by a supplier for a tax period
with the corresponding details. This clause also provides for the consequences of
mis-match.
Clause 44 provides that every registered person, other than certain specified
category of persons, shall furnish an annual return along with a copy of the audited114 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
annual accounts, a reconciliation statement and such other particulars as may be
prescribed.
Clause 45 provides that every registered person whose registration has been
cancelled shall furnish a final return within prescribed period.
Clause 46 provides for issuance of notice to registered person who has failed to
furnish a return.
Clause 47 provides for levy of fee for delayed filing of return.
Clause 48 provides for the manner of approval of goods and services tax
practitioner, their eligibility conditions, duties and obligations, manner of removal. This
clause also provides that a registered person may authorise a practitioner for filing of
various returns, but all the responsibilities under the proposed Act lie with the registered
person.
Clause 49 provides for payment of tax, interest, penalty and other amounts. This
clause further provides for maintenance of electronic cash ledger. This clause provides
that the input tax credit as self-assessed in the return of a registered person shall be
credited to his electronic credit ledger. This clause also provides for the manner in
which the amount in the electronic cash ledger or electronic credit ledger can be used.
This clause also provides for the ordering of the utilisation of input tax credit for
payment of tax, and provides restriction on certain cross-utilisation. This clause also
requires a person to discharge his liabilities in a given order.
Clause 50 provides for interest on delayed payment of tax. This clause fixes the
ceiling of interest rate in normal and other specified situations.
Clause 51 provides for deduction of tax at source by Government departments,
local authorities, Government agencies and other notified persons, at the rate of one
per cent. from the payment made or credited to the supplier in specified situations. This
clause elaborates on date of deduction, date of payment of the deducted amount to the
credit of Government and filing of prescribed statements.
Clause 52 provides for collection of tax at source by an electronic commerce
operator, at a notified rate where the consideration for supplies is to be collected by the
operator. This clause elaborates on date of collection, date of payment of the amount to
the credit of Government and filing of prescribed statements.
Clause 53 provides that on utilisation of input tax credit availed under the proposed
Act for payment of tax dues under the Integrated Goods and Services Tax Act, the
amount collected as central tax shall stand reduced by an amount equal to such credit
so utilised and the Central Government shall transfer an amount equal to the amount so
reduced from the central tax account to the integrated tax account in prescribed manner
and time.
Clause 54 provides that refund of excess tax and interest or any other amount
paid can be claimed before the expiry of two years from the relevant date. This clause
further provides that in case of zero-rated supplies and inverted tax structure, refund of
unutilised input tax credit can be claimed. This clause also provides for the time limit
within which the refund application has to be decided. This clause also provides that
in case of zero-rated supplies advance refund of ninety per cent. can be granted. This
clause provides that a person claiming refund has to prove that he is not enriching
himself unjustly by passing on the incidence of tax. If the incidence of tax has been
passed by the applicant to some other person then the tax or other amount which is
otherwise refundable shall be credited to a Fund called the Consumer Welfare Fund.
Clause 55 provides for refund of taxes paid on the notified supplies of goods or
services or both received by specified person or class of persons.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 115
Clause 56 provides for payment of interest on delayed payment of refund. It fixes
the ceiling of interest rate in normal and other specified situations.
Clause 57 provides that tax and other amounts which are otherwise refundable
barring unjust enrichment shall be credited to a Consumer Welfare Fund.
Clause 58 provides that the money in the Consumer Welfare Fund would be used
for the welfare of the consumers. This clause also provides that the Government or the
authority specified by it shall maintain proper and separate account of the Fund and
prepare an annual statement of accounts.
Clause 59 provides for self-assessment by every registered person.
Clause 60 provides for provisional assessment on request by a taxable person in
specified situations. This clause provides for the manner of paying tax and also the
manner and time limits for finalising of provisional assessment.
Clause 61 provides for scrutiny of returns and other particulars and manner of
sorting out the discrepancies in the returns and also taking corrective measures for
realisation of short-payment.
Clause 62 provides procedure of assessment of persons who have not filed returns
by the due dates. This clause provides that the proper officer may proceed to assess
the tax liability of the non-filer to the best of his judgment.
Clause 63 provides procedure of assessment of persons who are not registered
though they are liable to get registered. This clause provides that the proper officer
may proceed to assess the tax liability of the unregistered person to the best of his
judgment.
Clause 64 provides for summary assessment in special circumstances with the
permission of Additional Commissioner or Joint Commissioner.
Clause 65 provides detailed procedure for conduct of audit of records, maintained
by a registered person, to verify the correctness of tax liability and tax payment.
Clause 66 provides for audit of a registered person, under certain circumstances,
by a chartered accountant or a cost accountant.
Clause 67 provides for power and provides for the detailed procedure for carrying
out search, seizure and inspection to unearth non-compliance of provisions of the
proposed Act. This power can be exercised by an officer not below the rank of Joint
Commissioner or by an officer authorised by the Joint Commissioner.
Clause 68 provides for inspection of goods in movement. This clause provides
that the Government may require the person-in-charge of a conveyance carrying any
consignment of goods of value exceeding specified amount to carry with him prescribed
documents and devices.
Clause 69 provides for power to arrest a person who has committed certain
specified offence.
Clause 70 provides for power to summon any person whose attendance is
considered necessary in any inquiry.
Clause 71 provides that any authorised officer shall have access to any place of
business of a registered person for the purposes of carrying out any audit, scrutiny,
verification and checks as may be necessary to safeguard the interest of revenue.
Clause 72 provides for officers of Police, Railways, Customs and other officers
engaged in collection of land revenue to assist officers involved in implementation of
the proposed Act.
Clause 73 provides for determination of tax not paid or short paid or erroneously
refunded or input tax credit wrongly availed or utilised for any reason other than fraud116 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
or any wilful misstatement or suppression of facts. This clause further provides that the
adjudication order will be issued within three years from the due date of filing of annual
return for the year to which the discrepancy is noticed. This clause also provides that
the show cause notice is required to be issued at least three months prior to the time
limit. It has also been provided that SCN need not be issued if tax along with interest is
paid before issue of such notice. This clause also provides that where any person
chargeable with tax pays the tax along with interest within thirty days of issue of show
cause notice, no penalty shall be payable and all proceedings in respect of the notice
shall be deemed to be concluded.
Clause 74 provides that in cases of tax not paid or short paid or erroneously
refunded or input tax credit wrongly availed or utilised, for reasons of fraud or wilful
misstatement or suppression of facts, the adjudication order will be issued within five
years from the due date of filing of annual return for the year to which the discrepancy
is noticed. Further, the show cause notice is required to be issued at least six months
prior to the time limit. This clause also provides that such notice need not be issued if
tax along with interest and penalty equal to fifteen per cent. of tax is paid before issue
of such notice. This clause also provides that where any person chargeable with tax
pays the tax along with interest and penalty equal to twenty five per cent. of tax within
thirty days of issue of show cause notice, all proceedings in respect of the notice shall
be deemed to be concluded. This clause also provides that where any person chargeable
with tax pays the tax along with interest and penalty equal to fifty per cent. of tax within
thirty days of communication of order, all proceedings in respect of the notice shall be
deemed to be concluded.
Clause 75 provides for general provisions for determination of tax. This clause
provides that the period of stay, if any, would be excluded while calculating the time
period for issuance of show cause notice or passing of order. This clause further provides
that the time period during which appeal is pending in any appellate fora would be
excluded while calculating the time period for issuance of such notice or passing of
order. This clause also provides that no such notice needs to be issued for recovery of
unpaid self-assessed tax as per return and interest thereon. This clause also provides
that the adjudication proceedings shall be deemed to be concluded, if the order is not
issued within the statutory time limit.
Clause 76 provides that any amount collected as tax, along with interest, from
customers shall be paid to account of the Government regardless of whether the supplies
are taxable or not. This clause further provides for issuance of a show cause notice for
the amount collected but not deposited. This clause also provides that the order needs
to be issued within one year from the date of issuance of such notice.
Clause 77 provides for refund of central tax in situations where intra-State supplies
are subsequently held to be inter-State supplies.
Clause 78 provides that any amount payable in pursuance of an order shall be
paid by such person within a period of three months, except in certain specified cases,
from the date of service of order failing which recovery proceedings shall be initiated.
Clause 79 provides for various modes of recovery of amount payable under the
proposed Act.
Clause 80 provides for payment of arrears in a maximum of twenty-four instalments.
Clause 81 provides that transfer of property would be void in certain specified
circumstances.
Clause 82 provides that liabilities under the proposed Act shall be the first charge
on the property of the taxable person, save as otherwise provided in the Insolvency
and Bankruptcy Code, 2016.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 117
Clause 83 provides that during the pendency of any proceedings under certain
sections of the proposed Act, the Commissioner by order in writing attach provisionally
any property for a period of one year from the date of the order for provisional attachment.
Clause 84 provides for continuation and validation of certain recovery
proceedings.
Clause 85 provides that where a taxable person transfers his business in whole or
in part, the taxable person and the person to whom the business is so transferred shall,
jointly and severally, be liable wholly or to the extent of such transfer, to pay the tax,
interest or any penalty due from the taxable person up to the time of such transfer.
Clause 86 provides that where an agent supplies or receives any taxable goods
on behalf of his principal, such agent and his principal shall, jointly and severally, be
liable to pay the tax payable on such goods.
Clause 87 provides for the liability of companies when two or more companies are
amalgamated or merged in pursuance of an order of court or of Tribunal or otherwise.
Clause 88 provides for the liability of company and its directors when any company
is being wound up.
Clause 89 provides for the liability of director of a private company.
Clause 90 provides for the liability of the firm and each of the partners of the firm.
Clause 91 provides for the liability of guardians and trustees acting on behalf of
a minor or other incapacitated person.
Clause 92 provides for the liability of the Court of Wards, the Administrator
General, the Official Trustee or any receiver or manager.
Clause 93 provides for special provisions regarding liability to pay tax, interest or
penalty in certain cases.
Clause 94 provides for liability where a taxable person is a firm or an association
of persons or a Hindu Undivided Family and such firm, association or family has
discontinued business.
Clause 95 contains definitions of the terms and expressions used in the Chapter
on Advance Ruling.
Clause 96 provides that the Authority for Advance Ruling constituted under the
provisions of a State Goods and Services Tax Act or Union Territory Goods and Services
Tax Act shall be deemed to be the Authority for Advance Ruling in respect of that State
or Union territory under the proposed Act.
Clause 97 provides for form, manner and fee for filing of an application for advance
ruling. This clause also lists the nature of questions on which advance ruling can be
sought.
Clause 98 provides for the detailed procedure for filing of an application for
advance ruling. This clause provides that the advance ruling is to be pronounced
within ninety days from the date of receipt of application.
Clause 99 provides that the Appellate Authority for Advance Ruling constituted
under the provisions of a State Goods and Services Tax Act or a Union Territory Goods
and Services Tax Act shall be deemed to be the Appellate Authority in respect of that
State or Union Territory under the proposed Act.
Clause 100 provides that any party aggrieved by any advance ruling may appeal
to the Appellate Authority within a period of thirty days from the date on which the
ruling sought to be appealed against is communicated.118 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Clause 101 provides that the Appellate Authority shall pass order within a period
of ninety days from the date of filing of the appeal or a reference. This clause also
provides that where the members of the Appellate Authority differ on any point referred
to in appeal or reference; it shall be deemed that no advance ruling can be issued in
respect of the question under the appeal or reference.
Clause 102 provides that the Authority or the Appellate Authority may amend
any order passed by it so as to rectify any error apparent on the face of the record,
except under certain specified circumstances, within a period of six months from the
date of the order.
Clause 103 provides that the advance ruling shall be binding only on the applicant
and on the concerned officer or the jurisdictional officer in respect of the applicant.
This clause also provides that the advance ruling shall be binding unless there is a
change in law or facts.
Clause 104 provides that the advance ruling shall be void where the ruling has
been obtained by fraud or suppression of material facts or misrepresentation of facts.
Clause 105 provides that the Authority or the Appellate Authority shall have all
the powers of a civil court under the Code of Civil Procedure, 1908 for the purpose of
exercising its powers under the proposed Act.
Clause 106 provides that the Authority or the Appellate Authority shall have
power to regulate its own procedure.
Clause 107 provides the tax payer or the department may appeal against any
decision or order passed by an adjudicating authority under the proposed Act or the
State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act
within three months or six months respectively. The clause provides for a pre-deposit
of ten per cent. for admittance of the appeal filed by the tax payer and grant of automatic
stay on the remaining amount.
Clause 108 provides power of revision to the Commissioner. The clause provides
that the Revisional Authority, on his own motion, or upon request from Commissioner
of State tax or the Commissioner of Union territory tax may revise an order passed by an
officer subordinate to him if he considers it to be erroneous and prejudicial to the
interest of revenue.
Clause 109 provides for constitution of Appellate Tribunal for hearing appeals
against the orders passed by the Appellate Authority or the Revisional Authority. The
clause provides for formation of National, Regional, State and Area Benches.
Clause 110 provides for the qualification, appointment, conditions of services,
removal of the President and Members of the Appellate Tribunal.
Clause 111 provides for the procedure to be followed by the Appellate Tribunal
while disposing of any proceedings before it or appeal presented before it.
Clause 112 provides for the detailed procedure for filing of appeal before the
Appellate Tribunal. The clause further provides for filing of appeal by order passed
under the State Goods and Services Tax Act and the Union Territory Goods and Services
Act to be appealed in the Tribunal. The clause also provides for a pre-deposit of twenty
per cent. of amount of tax in dispute for admittance of appeal filed by the taxpayer in the
Appellate Tribunal and grant of automatic stay on the remaining amount.
Clause 113 provides for the process to be followed by Appellate Tribunal while
confirming, modifying or annulling the decision or order against which an appeal has
been filed.
Clause 114 provides for financial and administrative power of the President of the
Appellate Tribunal over the National and Regional Benches.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 119
Clause 115 provides for payment of interest where the pre-deposits are required
to be refunded consequent to any order of the Appellate Authority or of the Appellate
Tribunal.
Clause 116 provides for qualification, disqualification and other procedures relating
to authorised representative.
Clause 117 provides that the appeals to the High Court can be filed by a person,
aggrieved by an order of the State Bench or Area Bench of the Tribunal, within one
hundred and eighty days. This clause also provides that the High Court may admit the
appeal on substantial question of law.
Clause 118 provides for appeal before the Supreme Court from an order of the
National Bench or Regional Benches of the Appellate Tribunal, or from any judgment
given or order passed by the High Court.
Clause 119 provides that sums due to the Government in accordance with an
order passed by the National, Regional, State, Area Bench or a High Court shall be
payable notwithstanding that an appeal has been preferred to the High Court or the
Supreme Court.
Clause 120 confers powers on the Board to issue orders or instructions or directions
fixing monetary limits below which appeals will not be filed by the department.
Clause 121 provides for matters in which any decision taken or order passed by
an officer of central tax cannot be appealed against.
Clause 122 provides for a list of offences such as supply of goods without invoice,
issue of invoice without supply, etc., which shall be liable to penalty. The clause also
provides for offences such as aiding or abetting offences specified, fails to appear on
a summon, etc., will be liable of a penalty of twenty-five thousand rupees.
Clause 123 provides for a penalty for failure to furnish information return under
clause 150.
Clause 124 provides for a fine on any person who fails to furnish any information
or return under clause 151.
Clause 125 provides for a general penalty extending to twenty-five thousand
rupees for any contravention to the provisions of the proposed Act and where no
penalty has been separately specified for such contravention.
Clause 126 provides for general disciplines which shall be followed by the officer
imposing penalty under the proposed Act.
Clause 127 provides for the proper officer to impose penalty which is not covered
under any proceedings under specified clauses of the proposed Act.
Clause 128 confers power to the Government to waive penalty in part or full, any
penalty referred to in specified sections of the proposed Act or any late fee for specified
class of taxpayers and under specified circumstances.
Clause 129 provides for provisions relating to detention, seizure and release of
goods and conveyances in transit. This clause also provides for penalty which shall be
payable for release of such goods.
Clause 130 provides for provisions relating to confiscation of goods or
conveyances. This clause also provides for a fine which shall be payable for release of
such goods.
Clause 131 clarifies that confiscation made or penalty imposed under the provisions
of the proposed Act should not prevent the infliction of any other punishment imposed
under provisions of the proposed Act or under any other law for the time being in force.120 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Clause 132 provides for a list of offences which shall be punishable with gradation
of fine and imprisonment depending on the amount of tax evaded or the amount of input
tax credit wrongly availed or utilised or the amount of refund wrongly taken. This
clause also provides for offences which shall be non-cognizable and bailable or
cognizable and non-bailable.
Clause 133 provides for punishment and imprisonment for wrongful declaration
of information by any person engaged in connection with the collection of statistics
under clause 151 or any person engaged in connection with the provision of service on
the common portal or the agent of common portal.
Clause 134 provides for restriction to Courts to take cognizance of any offence
under the proposed Act or the rules made thereunder except with the previous sanction
of the Commissioner.
Clause 135 provides presumption of culpable mental state by the court unless
otherwise proved by the accused.
Clause 136 provides for relevancy of the statements made and signed by a person
on appearance in response to any summons.
Clause 137 provides that if the person who committed an offence is a company,
the person who was in charge and responsible for the conduct of business of the
company shall be deemed to be guilty of the offence and punished accordingly.
Clause 138 provides for compounding of any offence under the proposed Act,
either before or after the institution of prosecution, by the Commissioner on payment of
a prescribed compounding amount.
Clause 139 provides for migration of taxpayers registered under the existing law
to be issued provisional registration under the proposed Act, if the said taxpayer is
required to be registered under the provisions of the proposed Act.
Clause 140 provides for transitional arrangements for carrying forward of input
tax credit available under the existing law.
Clause 141 provides for transitional provisions relating to job work.
Clause 142 provides for miscellaneous provisions for transition of existing tax
payers in various situations.
Clause 143 provides for the procedure and conditions for sending any inputs or
capital goods, without payment of tax to a job worker for job work.
Clause 144 provides for presumption to be made for documents tendered by the
prosecution in evidence unless the contrary is proved by the person being prosecuted.
Clause 145 provides for admissibility of micro films, facsimile copies of documents
and computer printouts as evidence.
Clause 146 provides for notification of the Common Goods and Services Tax
Electronic Portal for facilitating registration, payment of tax, furnishing of returns,
computation and settlement of integrated tax, electronic way bill and other functions.
Clause 147 confers powers on the Government to notify certain supplies of goods
as deemed exports on the recommendations of the Council.
Clause 148 confers powers on the Government to notify certain classes of
registered persons, and the special procedures to be followed by such persons on the
recommendations of the Council.
Clause 149 provides for the assignment and provision of parameters for Goods
and Services tax compliance rating.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 121
Clause 150 provides for list of persons who are obligated to furnish information
return and the procedure to be followed by such persons.
Clause 151 confers powers on the Commissioner to direct collection of statistics
relating to any matter in connection with the proposed Act.
Clause 152 provides for situations and instances where there is a bar on disclosure
of information required under clause 151.
Clause 153 confers powers on officers to take assistance of any expert at any
stage of scrutiny, inquiry, investigation or any other proceedings.
Clause 154 provides for the power of the Commissioner or an officer authorised
by him to take samples of goods from the possession of any taxable person.
Clause 155 provides that the burden of proving rightful claim of input tax credit
will lie on the person claiming the credit.
Clause 156 provides that all persons discharging functions under the proposed
Act shall be deemed to be public servants within the meaning of section 21 of the
Indian Penal Code, 1860.
Clause 157 provides that no suit, prosecution or other legal proceedings shall lie
against the President, State President, Members, officers or other employees of the
Appellate Tribunal or any other officer appointed or authorised under the proposed
Act for anything which is in good faith done or intended to be done under the proposed
Act or rules made thereunder.
Clause 158 provides that no particulars contained in any statement made, return
furnished or accounts or documents produced in accordance with the proposed Act
should be disclosed. The clause also provides for specific circumstances under which
such information can be disclosed.
Clause 159 confers power on the Commissioner, or any other officer authorised
by him to publish the name of any person and any other particulars relating to any
proceedings or prosecution under the proposed Act if it is necessary in public interest
to do so.
Clause 160 provides that no assessment, re-assessment, adjudication, review,
revision, appeal, rectification, notice, summons or other proceedings done, accepted,
made, issued, initiated, or purported to have been done, accepted, made, issued, initiated
in pursuance of any of the provisions of the proposed Act shall be invalid or deemed to
be invalid merely by reason of any mistake, defect or omission.
Clause 161 provides that any authority can rectify any error which is apparent on
the face of record in any decision or order or notice or certificate or any other document.
Clause 162 restricts civil courts to have jurisdiction to deal with or decide any
question arising from or relating to anything done under the proposed Act.
Clause 163 provides that a fee may be charged for a copy of any order or document
provided to any person on an application made by him.
Clause 164 confers powers on the Central Government to make rules for carrying
out the provisions of the proposed Act on recommendations of the Council.
Clause 165 confers powers on the Board to make regulations for carrying out the
provisions of the proposed Act.
Clause 166 provides for laying of rules, regulations and notifications made by the
Central Government before each House of the Parliament.
Clause 167 provides that the Commissioner may direct that any power exercisable
by any authority or officer under the proposed Act may be exercisable also by another
authority or officer, subject to specified conditions.122 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Clause 168 confers powers to the Board to issue orders, instructions or directions
to the central tax officers for uniform implementation of the provisions of the proposed
Act.
Clause 169 provides for methods which should be followed for communication of
any decision, order, summons, notice or other communication under the proposed Act.
Clause 170 provides for rounding off of tax, interest, penalty, fine or any other
sum payable and the amount of refund or any other sum due.
Clause 171 provides that it is mandatory to pass on the benefit due to reduction
in rate of tax or from input tax credit to the consumer by way of commensurate reduction
in prices.
Clause 172 confers powers on the Central Government to make such provisions
not inconsistent with the provisions of the proposed Act or the rules or regulations by
a general or special order, on the recommendations of the Council within a period of
three years from the date of commencement of the proposed Act.
Clause 173 provides for omitting Chapter V of the Finance Act, 1994, save as
otherwise provided in the proposed Act.
Clause 174 provides repeal of certain Acts and savings of certain actions.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 123
FINANCIAL MEMORANDUM
Clause 53 of the Bill provides for apportionment of tax and settlement of funds on
account of transfer of utilisation of input tax credit under this Bill for the payment of tax dues
under the integrated goods and services tax by the Central Government.
2. Clause 96 of the Bill provides for the establishment of an Authority for Advance
Ruling under the State Goods and Services Tax Act or Union Territory Goods and Services
Tax Act and adoption of the same under the Central Goods and Services Tax Act.
3. Clause 99 of the Bill provides for the establishment of an Appellate Authority for
Advance Ruling under the State Goods and Services Tax Act or Union Territory Goods and
Services Tax Act and adoption of the same under the Central Goods and Services Tax Act.
4. Sub- clause (1) of clause 109 of the Bill provides for the establishment of the Goods
and Services Tax Appellate Tribunal by the Central Government for hearing appeals against
the orders passed by the Appellate Authority or the Revisional Authority. Sub-clause (8) of
clause 110 of the Bill provides for the salary and allowances payable to the President and
Members of the Appellate Tribunal.
5. Sub- clause (2) of clause 171 of the Bill provides for establishment of an authority for
an anti-profiteering clause in order to ensure that business passes on the benefit of reduced
tax incidence on goods or services or both to the consumers.
6. The total financial implications in terms of recurring and non-recurring expenditure
involved in carrying out the various functions under the proposed legislation would be
borne by the Central Government. Most of the existing officers and staff of the Central Board
of Excise and Customs would be used for carrying out the various functions under the Bill.
However, it is not possible to estimate the exact recurring and non-recurring expenditure
from the Consolidated Fund of India at this stage.124 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
MEMORANDUM REGARDING DELEGATED LEGISLATION
Clause 164 of the Central Goods and Services Bill, 2017 seeks to empower the
Central Government to make rules, inter alia, in the following matters, namely:—
(a) collection of taxes under section 9; (b) restrictions and conditions
applicable to person opting for composition levy on under section 10; (c) value
of the supply of goods or services or both under section 15; (d) conditions and
restrictions on availing input tax credit and categories of tax paying documents
under section 16; (e) depreciation on capital goods and plant and machinery as
specified under section 18; (f) conditions and restrictions to allow input tax credit
on inputs sent to a job worker for job work under section 19; (g) conditions and
restrictions to allow input tax credit on capital goods sent to a job worker for job
work under section 19; (h) manner of distribution of input tax credit by input
service distributor under section 20; (i) manner and conditions for getting
registered under section 25; (j) conditions for getting separate registration for
business vertical under section 25; (k) period in which tax invoice is to be issued
under section 31; (l) particulars to be declared on a tax invoice and a time in which
such invoices are to be issued under section 31; (m) particulars to be declared on
a credit or debit note under section 34; (n) particulars required to be maintained
by a registered person at his principal place of business under section 35;
(o) form and manner in which details of outward supplies are to be declared under
section 37; (p) form and manner in which details of inward supplies are to be
declared under section 38; (q) form and manner in which a return is to be filed by
the registered person under section 39; (r) conditions and restrictions for
provisional acceptance and claim of input tax credit under section 41; (s) calculation
of interest on delayed payment of tax under section 50; (t) manner in which tax is
to be deducted at source under section 51; (u) manner in which tax is to be
collected at source under section 52; (v) manner and time for transfer of input tax
credit under section 53; (w) form and manner in which application of refund is to
be made under section 54; (x) conditions and restrictions on refund in certain
cases under section 55; (y) manner in which consumer welfare fund is to be
constituted under section 57; (z) manner in which consumer welfare fund is to be
utilised under section 58; (za) form in which a bond for provisional assessment is
to be filed under section 60; (zb) manner in which returns are to be scrutinised
under section 61; (zc) frequency and manner in which audit will be taken by tax
authorities under section 65; (zd) manner in which advance ruling pronounced is
to be certified under section 98; (ze) form, manner and fee for appeal to Appellate
Authority under section 100; (zf) manner in which Advance Ruling pronounced
by the Appellate Authority is to be certified under section 101;(zg) appeals to
Appellate Authority under section 107; (zh) constitution of selection committee
and their manner of working for selection of the Technical Member (Centre) and
Technical Member (State) of the National Bench and Regional Benches under
section 110; (zi) verification of memorandum of cross objection under section
112; (zj) manner in which President exercise his financial and administrative powers
under section 114; (zk) time, form and manner in which persons furnish information
return under section 150; (zl) form and manner in which statistics is to be collected
under section 151; (zm) fee for taking a copy of any order or document under
section 163; (zn) powers and discharge such functions under section 171; and
(zo) any other matter which is to be, or may be, prescribed, or in respect of which
provision is to be made, by rules.
2. Clause 165 of the Bill empowers the Board to make regulations to provide for
any matter which is required to be, or may be, specified by regulation or in respect of
which provision is to be made by regulations.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 125
3. The matters in respect of which the said rules and regulations may be made are
matters of procedure and administrative detail, and as such, it is not practicable to
provide for them in the proposed Bill itself. The delegation of legislative power is,
therefore, of a normal character.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 126
BILL NO. 58 OF 2017
A Bill to make a provision for levy and collection of tax on inter-State supply of goods or
services or both by the Central Government and for matters connected therewith or
incidental thereto.
BE it enacted by Parliament in the Sixty-eighth Year of the Republic of India as
follows:—
CHAPTER I
PRELIMINARY
Short title, 1. (1) This Act may be called the Integrated Goods and Services Tax Act, 2017.
extent and
commencement. (2) It shall extend to the whole of India except the State of Jammu and Kashmir.
(3) It shall come into force on such date as the Central Government may, by notification
in the Official Gazette, appoint:
Provided that different dates may be appointed for different provisions of this Act
and any reference in any such provision to the commencement of this Act shall be construed
as a reference to the coming into force of that provision.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 127
2. In this Act, unless the context otherwise requires,–– Definitions.
(1) “Central Goods and Services Tax Act” means the Central Goods and Services
Tax Act, 2017;
(2) ‘‘central tax” means the tax levied and collected under the Central Goods
and Services Tax Act;
(3) “continuous journey” means a journey for which a single or more than one
ticket or invoice is issued at the same time, either by a single supplier of service or
through an agent acting on behalf of more than one supplier of service, and which
involves no stopover between any of the legs of the journey for which one or more
separate tickets or invoices are issued.
Explanation.––For the purposes of this clause, the term “stopover” means a
place where a passenger can disembark either to transfer to another conveyance or
break his journey for a certain period in order to resume it at a later point of time;
(4) “customs frontiers of India” means the limits of a customs area as defined
in section 2 of the Customs Act, 1962;
52 of 1962.
(5) “export of goods” with its grammatical variations and cognate expressions,
means taking goods out of India to a place outside India;
(6) “export of services” means the supply of any service when,––
(i) the supplier of service is located in India;
(ii) the recipient of service is located outside India;
(iii) the place of supply of service is outside India;
(iv) the payment for such service has been received by the supplier of
service in convertible foreign exchange; and
(v) the supplier of service and the recipient of service are not merely
establishments of a distinct person in accordance with Explanation 1 in
section 8;
(7) “fixed establishment” means a place (other than the registered place of
business) which is characterised by a sufficient degree of permanence and suitable
structure in terms of human and technical resources to supply services or to receive
and use services for its own needs;
(8) “Goods and Services Tax (Compensation to States) Act” means the Goods
and Services Tax (Compensation to States) Act, 2017;
(9) “Government” means the Central Government;
(10) ‘‘import of goods” with its grammatical variations and cognate expressions,
means bringing goods into India from a place outside India;
(11) ‘‘import of services” means the supply of any service, where––
(i) the supplier of service is located outside India;
(ii) the recipient of service is located in India; and
(iii) the place of supply of service is in India;
(12) “integrated tax” means the integrated goods and services tax levied under
this Act;
(13) “intermediary” means a broker, an agent or any other person, by whatever
name called, who arranges or facilitates the supply of goods or services or both, or
securities, between two or more persons, but does not include a person who supplies
such goods or services or both or securities on his own account;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 128
(14) “location of the recipient of services” means,––
(a) where a supply is received at a place of business for which the
registration has been obtained, the location of such place of business;
(b) where a supply is received at a place other than the place of business
for which registration has been obtained (a fixed establishment elsewhere), the
location of such fixed establishment;
(c) where a supply is received at more than one establishment, whether
the place of business or fixed establishment, the location of the establishment
most directly concerned with the receipt of the supply; and
(d) in absence of such places, the location of the usual place of residence
of the recipient;
(15) “location of the supplier of services” means,––
(a) where a supply is made from a place of business for which the
registration has been obtained, the location of such place of business;
(b) where a supply is made from a place other than the place of business
for which registration has been obtained (a fixed establishment elsewhere), the
location of such fixed establishment;
(c) where a supply is made from more than one establishment, whether
the place of business or fixed establishment, the location of the establishment
most directly concerned with the provision of the supply; and
(d) in absence of such places, the location of the usual place of residence
of the supplier;
(16) “non-taxable online recipient” means any Government, local authority,
governmental authority, an individual or any other person not registered and receiving
online information and database access or retrieval services in relation to any purpose
other than commerce, industry or any other business or profession, located in taxable
territory.
Explanation.––For the purposes of this clause, the expression “governmental
authority” means an authority or a board or any other body,––
(i) set up by an Act of Parliament or a State Legislature; or
(ii) established by any Government,
with ninety per cent. or more participation by way of equity or control, to carry out any
function entrusted to a municipality under article 243W of the Constitution;
(17) “online information and database access or retrieval services” means
services whose delivery is mediated by information technology over the internet or
an electronic network and the nature of which renders their supply essentially
automated and involving minimal human intervention and impossible to ensure in
the absence of information technology and includes electronic services such as,––
(i) advertising on the internet;
(ii) providing cloud services;
(iii) provision of e-books, movie, music, software and other intangibles
through telecommunication networks or internet;
(iv) providing data or information, retrievable or otherwise, to any person
in electronic form through a computer network;
(v) online supplies of digital content (movies, television shows, music
and the like);
(vi) digital data storage; and
(vii) online gaming;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 129
(18) “output tax”, in relation to a taxable person, means the integrated tax
chargeable under this Act on taxable supply of goods or services or both made by
him or by his agent but excludes tax payable by him on reverse charge basis;
(19) “Special Economic Zone” shall have the same meaning as assigned to it in
28 of 2005. clause (za) of section 2 of the Special Economic Zones Act, 2005;
(20) “Special Economic Zone developer” shall have the same meaning as
28 of 2005. assigned to it in clause (g) of section 2 of the Special Economic Zones Act, 2005 and
includes an Authority as defined in clause (d) and a Co-Developer as defined in
clause (f) of section 2 of the said Act;
(21) “supply” shall have the same meaning as assigned to it in section 7 of the
Central Goods and Services Tax Act;
(22) “taxable territory” means the territory to which the provisions of this Act
apply;
(23) “zero-rated supply” shall have the meaning assigned to it in section 16;
(24) words and expressions used and not defined in this Act but defined in the
Central Goods and Services Tax Act, the Union Territory Goods and Services Tax
Act and the Goods and Services Tax (Compensation to States) Act shall have the
same meaning as assigned to them in those Acts;
(25) any reference in this Act to a law which is not in force in the State of
Jammu and Kashmir, shall, in relation to that State be construed as a reference to the
corresponding law, if any, in force in that State.
CHAPTER II
ADMINISTRATION
3. The Board may appoint such central tax officers as it thinks fit for exercising the Appointment
powers under this Act. of officers.
4. Without prejudice to the provisions of this Act, the officers appointed under the Authorisation
State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act are of officers of
State tax or
authorised to be the proper officers for the purposes of this Act, subject to such exceptions
Union territory
and conditions as the Government shall, on the recommendations of the Council, by tax as proper
notification, specify. officer in
certain
circumstances.
CHAPTER III
LEVY AND COLLECTION OF TAX
5. (1) Subject to the provisions of sub-section (2), there shall be levied a tax called the Levy and
integrated goods and services tax on all inter-State supplies of goods or services or both, collection.
except on the supply of alcoholic liquor for human consumption, on the value determined
under section 15 of the Central Goods and Services Tax Act and at such rates, not exceeding
forty per cent., as may be notified by the Government on the recommendations of the
Council and collected in such manner as may be prescribed and shall be paid by the taxable
person:
Provided that the integrated tax on goods imported into India shall be levied and
51 of 1975. collected in accordance with the provisions of section 3 of the Customs Tariff Act, 1975 on
the value as determined under the said Act at the point when duties of customs are levied on
52 of 1962. the said goods under section 12 of the Customs Act, 1962.
(2) The integrated tax on the supply of petroleum crude, high speed diesel, motor
spirit (commonly known as petrol), natural gas and aviation turbine fuel shall be levied
with effect from such date as may be notified by the Government on the recommendations
of the Council.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 130
(3) The Government may, on the recommendations of the Council, by notification,
specify categories of supply of goods or services or both, the tax on which shall be paid on
reverse charge basis by the recipient of such goods or services or both and all the provisions
of this Act shall apply to such recipient as if he is the person liable for paying the tax in
relation to the supply of such goods or services or both.
(4) The integrated tax in respect of the supply of taxable goods or services or both by
a supplier, who is not registered, to a registered person shall be paid by such person on
reverse charge basis as the recipient and all the provisions of this Act shall apply to such
recipient as if he is the person liable for paying the tax in relation to the supply of such
goods or services or both.
(5) The Government may, on the recommendations of the Council, by notification,
specify categories of services, the tax on inter-State supplies of which shall be paid by the
electronic commerce operator if such services are supplied through it, and all the provisions
of this Act shall apply to such electronic commerce operator as if he is the supplier liable
for paying the tax in relation to the supply of such services:
Provided that where an electronic commerce operator does not have a physical
presence in the taxable territory, any person representing such electronic commerce operator
for any purpose in the taxable territory shall be liable to pay tax:
Provided further that where an electronic commerce operator does not have a physical
presence in the taxable territory and also does not have a representative in the said territory,
such electronic commerce operator shall appoint a person in the taxable territory for the
purpose of paying tax and such person shall be liable to pay tax.
Power to 6. (1) Where the Government is satisfied that it is necessary in the public interest so
grant to do, it may, on the recommendations of the Council, by notification, exempt generally,
exemption
either absolutely or subject to such conditions as may be specified therein, goods or services
from tax.
or both of any specified description from the whole or any part of the tax leviable thereon
with effect from such date as may be specified in such notification.
(2) Where the Government is satisfied that it is necessary in the public interest so to
do, it may, on the recommendations of the Council, by special order in each case, under
circumstances of an exceptional nature to be stated in such order, exempt from payment of
tax any goods or services or both on which tax is leviable.
(3) The Government may, if it considers necessary or expedient so to do for the
purpose of clarifying the scope or applicability of any notification issued under
sub-section (1) or order issued under sub-section (2), insert an Explanation in such notification
or order, as the case may be, by notification at any time within one year of issue of the notification
under sub-section (1) or order under sub-section (2), and every such Explanation shall have
effect as if it had always been the part of the first such notification or order, as the case may be.
Explanation.–– For the purposes of this section, where an exemption in respect of
any goods or services or both from the whole or part of the tax leviable thereon has been
granted absolutely, the registered person supplying such goods or services or both shall not
collect the tax, in excess of the effective rate, on such supply of goods or services or both.
CHAPTER IV
DETERMINATION OF NATURE OF SUPPLY
Inter-State 7. (1) Subject to the provisions of section 10, supply of goods, where the location of
supply. the supplier and the place of supply are in––
(a) two different States;
(b) two different Union territories; or
(c) a State and a Union territory,
shall be treated as a supply of goods in the course of inter-State trade or commerce.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 131
(2) Supply of goods imported into the territory of India, till they cross the customs
frontiers of India, shall be treated to be a supply of goods in the course of inter-State trade
or commerce.
(3) Subject to the provisions of section 12, supply of services, where the location of
the supplier and the place of supply are in––
(a) two different States;
(b) two different Union territories; or
(c) a State and a Union territory,
shall be treated as a supply of services in the course of inter-State trade or commerce.
(4) Supply of services imported into the territory of India shall be treated to be a
supply of services in the course of inter-State trade or commerce.
(5) Supply of goods or services or both,––
(a) when the supplier is located in India and the place of supply is outside
India;
(b) to or by a Special Economic Zone developer or a Special Economic Zone
unit; or
(c) in the taxable territory, not being an intra-State supply and not covered
elsewhere in this section,
shall be treated to be a supply of goods or services or both in the course of inter-State trade
or commerce.
8. (1) Subject to the provisions of section 10, supply of goods where the location of Intra-State
the supplier and the place of supply of goods are in the same State or same Union territory supply.
shall be treated as intra-State supply:
Provided that the following supply of goods shall not be treated as intra-State supply,
namely:––
(i) supply of goods to or by a Special Economic Zone developer or a Special
Economic Zone unit;
(ii) goods imported into the territory of India till they cross the customs frontiers
of India; or
(iii) supplies made to a tourist referred to in section 15.
(2) Subject to the provisions of section 12, supply of services where the location of
the supplier and the place of supply of services are in the same State or same Union territory
shall be treated as intra-State supply:
Provided that the intra-State supply of services shall not include supply of services to
or by a Special Economic Zone developer or a Special Economic Zone unit.
Explanation 1.––For the purposes of this Act, where a person has,––
(i) an establishment in India and any other establishment outside India;
(ii) an establishment in a State or Union territory and any other establishment
outside that State or Union territory; or
(iii) an establishment in a State or Union territory and any other establishment
being a business vertical registered within that State or Union territory,
then such establishments shall be treated as establishments of distinct persons.
Explanation 2.––A person carrying on a business through a branch or an agency or a
representational office in any territory shall be treated as having an establishment in that
territory.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 132
Supplies in 9. Notwithstanding anything contained in this Act,––
territorial
waters. (a) where the location of the supplier is in the territorial waters, the location of
such supplier; or
(b) where the place of supply is in the territorial waters, the place of supply,
shall, for the purposes of this Act, be deemed to be in the coastal State or Union territory
where the nearest point of the appropriate baseline is located.
CHAPTER V
PLACE OF SUPPLY OF GOODS OR SERVICES OR BOTH
Place of 10. (1) The place of supply of goods, other than supply of goods imported into, or
supply of exported from India, shall be as under,––
goods other
than supply of (a) where the supply involves movement of goods, whether by the supplier or
goods the recipient or by any other person, the place of supply of such goods shall be the
imported into,
location of the goods at the time at which the movement of goods terminates for
or exported
from India. delivery to the recipient;
(b) where the goods are delivered by the supplier to a recipient or any other
person on the direction of a third person, whether acting as an agent or otherwise,
before or during movement of goods, either by way of transfer of documents of title
to the goods or otherwise, it shall be deemed that the said third person has received
the goods and the place of supply of such goods shall be the principal place of business
of such person;
(c) where the supply does not involve movement of goods, whether by the
supplier or the recipient, the place of supply shall be the location of such goods at the
time of the delivery to the recipient;
(d) where the goods are assembled or installed at site, the place of supply shall
be the place of such installation or assembly;
(e) where the goods are supplied on board a conveyance, including a vessel, an
aircraft, a train or a motor vehicle, the place of supply shall be the location at which
such goods are taken on board.
(2) Where the place of supply of goods cannot be determined, the place of supply
shall be determined in such manner as may be prescribed.
Place of 11. The place of supply of goods,––
supply of
goods (a) imported into India shall be the location of the importer;
imported
into, or (b) exported from India shall be the location outside India.
exported
fPrloamce Ionfdia. 12. (1) The provisions of this section shall apply to determine the place of supply of
supply of services where the location of supplier of services and the location of the recipient of
services
services is in India.
where
location of (2) The place of supply of services, except the services specified in sub-sections (3)
supplier and
to (14),––
recipient is in
India. (a) made to a registered person shall be the location of such person;
(b) made to any person other than a registered person shall be,––
(i) the location of the recipient where the address on record exists; and
(ii) the location of the supplier of services in other cases.
(3) The place of supply of services,––
(a) directly in relation to an immovable property, including services provided
by architects, interior decorators, surveyors, engineers and other related experts orSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 133
estate agents, any service provided by way of grant of rights to use immovable
property or for carrying out or co-ordination of construction work; or
(b) by way of lodging accommodation by a hotel, inn, guest house, home stay,
club or campsite, by whatever name called, and including a house boat or any other
vessel; or
(c) by way of accommodation in any immovable property for organising any
marriage or reception or matters related thereto, official, social, cultural, religious or
business function including services provided in relation to such function at such
property; or
(d) any services ancillary to the services referred to in clauses (a), (b) and (c),
shall be the location at which the immovable property or boat or vessel, as the case may be,
is located or intended to be located:
Provided that if the location of the immovable property or boat or vessel is located or
intended to be located outside India, the place of supply shall be the location of the recipient.
Explanation.––Where the immovable property or boat or vessel is located in more
than one State or Union territory, the supply of services shall be treated as made in each of
the respective States or Union territories, in proportion to the value for services separately
collected or determined in terms of the contract or agreement entered into in this regard or,
in the absence of such contract or agreement, on such other basis as may be prescribed.
(4) The place of supply of restaurant and catering services, personal grooming, fitness,
beauty treatment, health service including cosmetic and plastic surgery shall be the location
where the services are actually performed.
(5) The place of supply of services in relation to training and performance appraisal
to,––
(a) a registered person, shall be the location of such person;
(b) a person other than a registered person, shall be the location where the services
are actually performed.
(6) The place of supply of services provided by way of admission to a cultural, artistic,
sporting, scientific, educational, entertainment event or amusement park or any other place
and services ancillary thereto, shall be the place where the event is actually held or where
the park or such other place is located.
(7) The place of supply of services provided by way of ,—
(a) organisation of a cultural, artistic, sporting, scientific, educational or
entertainment event including supply of services in relation to a conference, fair,
exhibition, celebration or similar events; or
(b) services ancillary to organisation of any of the events or services referred to
in clause (a) , or assigning of sponsorship to such events,––
(i) to a registered person, shall be the location of such person;
(ii) to a person other than a registered person, shall be the place where
the event is actually held and if the event is held outside India, the place of
supply shall be the location of the recipient.
Explanation.––Where the event is held in more than one State or Union territory
and a consolidated amount is charged for supply of services relating to such event,
the place of supply of such services shall be taken as being in each of the respective
States or Union territories in proportion to the value for services separately collected
or determined in terms of the contract or agreement entered into in this regard or, in
the absence of such contract or agreement, on such other basis as may be prescribed.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 134
(8) The place of supply of services by way of transportation of goods, including by
mail or courier to,––
(a) a registered person, shall be the location of such person;
(b) a person other than a registered person, shall be the location at which such
goods are handed over for their transportation.
(9) The place of supply of passenger transportation service to,—
(a) a registered person, shall be the location of such person;
(b) a person other than a registered person, shall be the place where the passenger
embarks on the conveyance for a continuous journey:
Provided that where the right to passage is given for future use and the point of
embarkation is not known at the time of issue of right to passage, the place of supply
of such service shall be determined in accordance with the provisions of
sub-section (2).
Explanation.––For the purposes of this sub-section, the return journey shall be
treated as a separate journey, even if the right to passage for onward and return journey
is issued at the same time.
(10) The place of supply of services on board a conveyance, including a vessel, an
aircraft, a train or a motor vehicle, shall be the location of the first scheduled point of
departure of that conveyance for the journey.
(11) The place of supply of telecommunication services including data transfer,
broadcasting, cable and direct to home television services to any person shall,—
(a) in case of services by way of fixed telecommunication line, leased circuits,
internet leased circuit, cable or dish antenna, be the location where the
telecommunication line, leased circuit or cable connection or dish antenna is installed
for receipt of services;
(b) in case of mobile connection for telecommunication and internet services
provided on post-paid basis, be the location of billing address of the recipient of
services on the record of the supplier of services;
(c) in cases where mobile connection for telecommunication, internet service
and direct to home television services are provided on pre-payment basis through a
voucher or any other means,––
(i) through a selling agent or a re-seller or a distributor of subscriber
identity module card or re-charge voucher, be the address of the selling agent
or re-seller or distributor as per the record of the supplier at the time of supply;
or
(ii) by any person to the final subscriber, be the location where such pre-
payment is received or such vouchers are sold;
(d) in other cases, be the address of the recipient as per the records of the
supplier of services and where such address is not available, the place of supply shall
be location of the supplier of services:
Provided that where the address of the recipient as per the records of the supplier
of services is not available, the place of supply shall be location of the supplier of
services:
Provided further that if such pre-paid service is availed or the recharge is made
through internet banking or other electronic mode of payment, the location of the
recipient of services on the record of the supplier of services shall be the place of
supply of such services.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 135
Explanation.––Where the leased circuit is installed in more than one State or Union
territory and a consolidated amount is charged for supply of services relating to such circuit,
the place of supply of such services shall be taken as being in each of the respective States
or Union territories in proportion to the value for services separately collected or determined
in terms of the contract or agreement entered into in this regard or, in the absence of such
contract or agreement, on such other basis as may be prescribed.
(12) The place of supply of banking and other financial services, including stock
broking services to any person shall be the location of the recipient of services on the
records of the supplier of services:
Provided that if the location of recipient of services is not on the records of the
supplier, the place of supply shall be the location of the supplier of services.
(13) The place of supply of insurance services shall,––
(a) to a registered person, be the location of such person;
(b) to a person other than a registered person, be the location of the recipient of
services on the records of the supplier of services.
(14) The place of supply of advertisement services to the Central Government, a
State Government, a statutory body or a local authority meant for the States or Union
territories identified in the contract or agreement shall be taken as being in each of such
States or Union territories and the value of such supplies specific to each State or Union
territory shall be in proportion to the amount attributable to services provided by way of
dissemination in the respective States or Union territories as may be determined in terms of
the contract or agreement entered into in this regard or, in the absence of such contract or
agreement, on such other basis as may be prescribed.
13. (1) The provisions of this section shall apply to determine the place of supply of Place of
services where the location of the supplier of services or the location of the recipient of supply of
services where
services is outside India.
location of
supplier or
(2) The place of supply of services except the services specified in sub-sections (3)
location of
to (13) shall be the location of the recipient of services:
recipient is
outside India.
Provided that where the location of the recipient of services is not available in the
ordinary course of business, the place of supply shall be the location of the supplier of
services.
(3) The place of supply of the following services shall be the location where the
services are actually performed, namely:—
(a) services supplied in respect of goods which are required to be made
physically available by the recipient of services to the supplier of services, or to a
person acting on behalf of the supplier of services in order to provide the services:
Provided that when such services are provided from a remote location by way
of electronic means, the place of supply shall be the location where goods are situated
at the time of supply of services:
Provided further that nothing contained in this clause shall apply in the case
of services supplied in respect of goods which are temporarily imported into India
for repairs and are exported after repairs without being put to any other use in India,
than that which is required for such repairs;
(b) services supplied to an individual, represented either as the recipient of
services or a person acting on behalf of the recipient, which require the physical
presence of the recipient or the person acting on his behalf, with the supplier for the
supply of services.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 136
(4) The place of supply of services supplied directly in relation to an immovable
property, including services supplied in this regard by experts and estate agents, supply of
accommodation by a hotel, inn, guest house, club or campsite, by whatever name called,
grant of rights to use immovable property, services for carrying out or co-ordination of
construction work, including that of architects or interior decorators, shall be the place
where the immovable property is located or intended to be located.
(5) The place of supply of services supplied by way of admission to, or organisation
of a cultural, artistic, sporting, scientific, educational or entertainment event, or a celebration,
conference, fair, exhibition or similar events, and of services ancillary to such admission or
organisation, shall be the place where the event is actually held.
(6) Where any services referred to in sub-section (3) or sub-section (4) or
sub-section (5) is supplied at more than one location, including a location in the taxable
territory, its place of supply shall be the location in the taxable territory.
(7) Where the services referred to in sub-section (3) or sub-section (4) or
sub-section (5) are supplied in more than one State or Union territory, the place of supply
of such services shall be taken as being in each of the respective States or Union territories
and the value of such supplies specific to each State or Union territory shall be in proportion
to the value for services separately collected or determined in terms of the contract or
agreement entered into in this regard or, in the absence of such contract or agreement, on
such other basis as may be prescribed.
(8) The place of supply of the following services shall be the location of the supplier
of services, namely:––
(a) services supplied by a banking company, or a financial institution, or a
non-banking financial company, to account holders;
(b) intermediary services;
(c) services consisting of hiring of means of transport, including yachts but
excluding aircrafts and vessels, up to a period of one month.
Explanation.––For the purposes of this sub-section, the expression,––
(a) “account” means an account bearing interest to the depositor, and
includes a non-resident external account and a non-resident ordinary account;
(b) “banking company” shall have the same meaning as assigned to it
under clause (a) of section 45A of the Reserve Bank of India Act, 1934; 2 of 1934.
(c) ‘‘financial institution” shall have the same meaning as assigned to it
in clause (c) of section 45-I of the Reserve Bank of India Act, 1934; 2 of 1934.
(d) “non-banking financial company” means,––
(i) a financial institution which is a company;
(ii) a non-banking institution which is a company and which has as
its principal business the receiving of deposits, under any scheme or
arrangement or in any other manner, or lending in any manner; or
(iii) such other non-banking institution or class of such institutions,
as the Reserve Bank of India may, with the previous approval of the
Central Government and by notification in the Official Gazette, specify.
(9) The place of supply of services of transportation of goods, other than by way of
mail or courier, shall be the place of destination of such goods.
(10) The place of supply in respect of passenger transportation services shall be the
place where the passenger embarks on the conveyance for a continuous journey.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 137
(11) The place of supply of services provided on board a conveyance during the
course of a passenger transport operation, including services intended to be wholly or
substantially consumed while on board, shall be the first scheduled point of departure of
that conveyance for the journey.
(12) The place of supply of online information and database access or retrieval
services shall be the location of the recipient of services.
Explanation.––For the purposes of this sub-section, person receiving such services
shall be deemed to be located in the taxable territory, if any two of the following non-
contradictory conditions are satisfied, namely:––
(a) the location of address presented by the recipient of services through internet
is in the taxable territory;
(b) the credit card or debit card or store value card or charge card or smart card
or any other card by which the recipient of services settles payment has been issued
in the taxable territory;
(c) the billing address of the recipient of services is in the taxable territory;
(d) the internet protocol address of the device used by the recipient of services
is in the taxable territory;
(e) the bank of the recipient of services in which the account used for payment
is maintained is in the taxable territory;
(f) the country code of the subscriber identity module card used by the recipient
of services is of taxable territory;
(g) the location of the fixed land line through which the service is received by
the recipient is in the taxable territory.
(13) In order to prevent double taxation or non-taxation of the supply of a service, or
for the uniform application of rules, the Government shall have the power to notify any
description of services or circumstances in which the place of supply shall be the place of
effective use and enjoyment of a service.
14. (1) On supply of online information and database access or retrieval services by Special
any person located in a non-taxable territory and received by a non-taxable online recipient, provision for
payment of tax
the supplier of services located in a non-taxable territory shall be the person liable for
by a supplier of
paying integrated tax on such supply of services:
online
information and
Provided that in the case of supply of online information and database access or
database access
retrieval services by any person located in a non-taxable territory and received by a non- or retrieval
taxable online recipient, an intermediary located in the non-taxable territory, who arranges services.
or facilitates the supply of such services, shall be deemed to be the recipient of such services
from the supplier of services in non-taxable territory and supplying such services to the
non-taxable online recipient except when such intermediary satisfies the following
conditions, namely:––
(a) the invoice or customer’s bill or receipt issued or made available by such
intermediary taking part in the supply clearly identifies the service in question and its
supplier in non-taxable territory;
(b) the intermediary involved in the supply does not authorise the charge to the
customer or take part in its charge which is that the intermediary neither collects or
processes payment in any manner nor is responsible for the payment between the
non-taxable online recipient and the supplier of such services;
(c) the intermediary involved in the supply does not authorise delivery; and
(d) the general terms and conditions of the supply are not set by the intermediary
involved in the supply but by the supplier of services.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 138
(2) The supplier of online information and database access or retrieval services referred
to in sub-section (1) shall, for payment of integrated tax, take a single registration under the
Simplified Registration Scheme to be notified by the Government:
Provided that any person located in the taxable territory representing such supplier
for any purpose in the taxable territory shall get registered and pay integrated tax on behalf
of the supplier:
Provided further that if such supplier does not have a physical presence or does not
have a representative for any purpose in the taxable territory, he may appoint a person in
the taxable territory for the purpose of paying integrated tax and such person shall be liable
for payment of such tax.
CHAPTER VI
REFUND OF INTEGRATED TAX TO INTERNATIONAL TOURIST
Refund of 15. The integrated tax paid by tourist leaving India on any supply of goods taken out
integrated tax of India by him shall be refunded in such manner and subject to such conditions and
paid on supply
safeguards as may be prescribed.
of goods to
tourist leaving Explanation.––For the purposes of this section, the term “tourist” means a person
India.
not normally resident in India, who enters India for a stay of not more than six months for
legitimate non-immigrant purposes.
CHAPTER VII
ZERO RATED SUPPLY
Zero rated 16. (1) “zero rated supply” means any of the following supplies of goods or services
supply. or both, namely:––
(a) export of goods or services or both; or
(b) supply of goods or services or both to a Special Economic Zone developer
or a Special Economic Zone unit.
(2) Subject to the provisions of sub-section (5) of section 17 of the Central Goods
and Services Tax Act, credit of input tax may be availed for making zero-rated supplies,
notwithstanding that such supply may be an exempt supply.
(3) A registered person making zero rated supply shall be eligible to claim refund
under either of the following options, namely:––
(a) he may supply goods or services or both under bond or Letter of Undertaking,
subject to such conditions, safeguards and procedure as may be prescribed, without
payment of integrated tax and claim refund of unutilised input tax credit; or
(b) he may supply goods or services or both, subject to such conditions,
safeguards and procedure as may be prescribed, on payment of integrated tax and
claim refund of such tax paid on goods or services or both supplied,
in accordance with the provisions of section 54 of the Central Goods and Services Tax Act
or the rules made thereunder.
CHAPTER VIII
APPORTIONMENT OF TAX AND SETTLEMENT OF FUNDS
Apportionment 17. (1) Out of the integrated tax paid to the Central Government,––
of tax and
(a) in respect of inter-State supply of goods or services or both to an unregistered
settlement of
funds. person or to a registered person paying tax under section 10 of the Central Goods and
Services Tax Act;
(b) in respect of inter-State supply of goods or services or both where the
registered person is not eligible for input tax credit;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 139
(c) in respect of inter-State supply of goods or services or both made in a financial
year to a registered person, where he does not avail of the input tax credit within the
specified period and thus remains in the integrated tax account after expiry of the due
date for furnishing of annual return for such year in which the supply was made;
(d) in respect of import of goods or services or both by an unregistered person
or by a registered person paying tax under section 10 of the Central Goods and Services
Tax Act;
(e) in respect of import of goods or services or both where the registered person
is not eligible for input tax credit;
(f) in respect of import of goods or services or both made in a financial year by
a registered person, where he does not avail of the said credit within the specified
period and thus remains in the integrated tax account after expiry of the due date for
furnishing of annual return for such year in which the supply was received,
the amount of tax calculated at the rate equivalent to the central tax on similar intra-State
supply shall be apportioned to the Central Government.
(2) The balance amount of integrated tax remaining in the integrated tax account in
respect of the supply for which an apportionment to the Central Government has been done
under sub-section (1) shall be apportioned to the,––
(a) State where such supply takes place; and
(b) Central Government where such supply takes place in a Union territory:
Provided that where the place of such supply made by any taxable person cannot
be determined separately, the said balance amount shall be apportioned to,––
(a) each of the States; and
(b) Central Government in relation to Union territories,
in proportion to the total supplies made by such taxable person to each of such States or
Union territories, as the case may be, in a financial year:
Provided further that where the taxable person making such supplies is not identifiable,
the said balance amount shall be apportioned to all States and the Central Government in
proportion to the amount collected as State tax or, as the case may be, Union territory tax,
by the respective State or, as the case may be, by the Central Government during the
immediately preceding financial year.
(3) The provisions of sub-sections (1) and (2) relating to apportionment of integrated
tax shall, mutatis mutandis, apply to the apportionment of interest, penalty and compounding
amount realised in connection with the tax so apportioned.
(4) Where an amount has been apportioned to the Central Government or a State
Government under sub-section (1) or sub-section (2) or sub-section (3), the amount
collected as integrated tax shall stand reduced by an amount equal to the amount so
apportioned and the Central Government shall transfer to the central tax account or Union
territory tax account, an amount equal to the respective amounts apportioned to the Central
Government and shall transfer to the State tax account of the respective States an amount
equal to the amount apportioned to that State, in such manner and within such time as
may be prescribed.
(5) Any integrated tax apportioned to a State or, as the case may be, to the Central
Government on account of a Union territory, if subsequently found to be refundable to any
person and refunded to such person, shall be reduced from the amount to be apportioned
under this section, to such State, or Central Government on account of such Union territory,
in such manner and within such time as may be prescribed.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 140
Transfer of 18. On utilisation of credit of integrated tax availed under this Act for payment of,––
input tax
(a) central tax in accordance with the provisions of sub-section (5) of section
credit.
49 of the Central Goods and Services Tax Act, the amount collected as integrated tax
shall stand reduced by an amount equal to the credit so utilised and the Central
Government shall transfer an amount equal to the amount so reduced from the
integrated tax account to the central tax account in such manner and within such time
as may be prescribed;
(b) Union territory tax in accordance with the provisions of section 9 of the
Union Territory Goods and Services Tax Act, the amount collected as integrated tax
shall stand reduced by an amount equal to the credit so utilised and the Central
Government shall transfer an amount equal to the amount so reduced from the
integrated tax account to the Union territory tax account in such manner and within
such time as may be prescribed;
(c) State tax in accordance with the provisions of the respective State Goods
and Services Tax Act, the amount collected as integrated tax shall stand reduced by
an amount equal to the credit so utilised and shall be apportioned to the appropriate
State Government and the Central Government shall transfer the amount so
apportioned to the account of the appropriate State Government in such manner and
within such time as may be prescribed.
Explanation.––For the purposes of this Chapter, “appropriate State” in relation
to a taxable person, means the State or Union territory where he is registered or is
liable to be registered under the provisions of the Central Goods and Services Tax
Act.
Tax 19. (1) A registered person who has paid integrated tax on a supply considered by
wrongfully him to be an inter-State supply, but which is subsequently held to be an intra-State supply,
collected and shall be granted refund of the amount of integrated tax so paid in such manner and subject
paid to Central
to such conditions as may be prescribed.
Government or
State
(2) A registered person who has paid central tax and State tax or Union territory tax,
Government.
as the case may be, on a transaction considered by him to be an intra-State supply, but
which is subsequently held to be an inter-State supply, shall not be required to pay any
interest on the amount of integrated tax payable.
CHAPTER IX
MISCELLANEOUS
Application 20. Subject to the provisions of this Act and the rules made thereunder, the provisions
of provisions of Central Goods and Services Tax Act relating to,––
of Central
Goods and (i) scope of supply;
Services Tax
Act. (ii) composite supply and mixed supply;
(iii) time and value of supply;
(iv) input tax credit;
(v) registration;
(vi) tax invoice, credit and debit notes;
(vii) accounts and records;
(viii) returns, other than late fee;
(ix) payment of tax;
(x) tax deduction at source;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 141
(xi) collection of tax at source;
(xii) assessment;
(xiii) refunds;
(xiv) audit;
(xv) inspection, search, seizure and arrest;
(xvi) demands and recovery;
(xvii) liability to pay in certain cases;
(xviii) advance ruling;
(xix) appeals and revision;
(xx) presumption as to documents;
(xxi) offences and penalties;
(xxii) job work;
(xxiii) electronic commerce;
(xxiv) transitional provisions; and
(xxv) miscellaneous provisions including the provisions relating to the
imposition of interest and penalty,
shall, mutatis mutandis, apply, so far as may be, in relation to integrated tax as they
apply in relation to central tax as if they are enacted under this Act:
Provided that in the case of tax deducted at source, the deductor shall deduct
tax at the rate of two per cent. from the payment made or credited to the supplier:
Provided further that in the case of tax collected at source, the operator shall
collect tax at such rate not exceeding two per cent, as may be notified on the
recommendations of the Council, of the net value of taxable supplies:
Provided also that for the purposes of this Act, the value of a supply shall
include any taxes, duties, cesses, fees and charges levied under any law for the time
being in force other than this Act, and the Goods and Services Tax (Compensation to
States) Act, if charged separately by the supplier:
Provided also that in cases where the penalty is leviable under the Central
Goods and Services Tax Act and the State Goods and Services Tax Act or the Union
Territory Goods and Services Tax Act, the penalty leviable under this Act shall be the
sum total of the said penalties.
21. Import of services made on or after the appointed day shall be liable to tax under Import of
the provisions of this Act regardless of whether the transactions for such import of services services made
on or after the
had been initiated before the appointed day:
appointed day.
Provided that if the tax on such import of services had been paid in full under the
existing law, no tax shall be payable on such import under this Act:
Provided further that if the tax on such import of services had been paid in part under
the existing law, the balance amount of tax shall be payable on such import under this Act.
Explanation.––For the purposes of this section, a transaction shall be deemed to
have been initiated before the appointed day if either the invoice relating to such supply or
payment, either in full or in part, has been received or made before the appointed day.
22. (1) The Government may, on the recommendations of the Council, by notification, Power to
make rules for carrying out the provisions of this Act. make rules.
(2) Without prejudice to the generality of the provisions of sub-section (1), the
Government may make rules for all or any of the matters which by this Act are required to
be, or may be, prescribed or in respect of which provisions are to be or may be made by
rules.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 142
(3) The power to make rules conferred by this section shall include the power to give
retrospective effect to the rules or any of them from a date not earlier than the date on which
the provisions of this Act come into force.
(4) Any rules made under sub-section (1) may provide that a contravention thereof
shall be liable to a penalty not exceeding ten thousand rupees.
23. The Board may, by notification, make regulations consistent with this Act and the Power to
rules made thereunder to carry out the provisions of this Act. make
regulations.
24. Every rule made by the Government, every regulation made by the Board and Laying of
every notification issued by the Government under this Act, shall be laid, as soon as may rules,
regulations
be, after it is made or issued, before each House of Parliament, while it is in session, for a
and
total period of thirty days which may be comprised in one session or in two or more successive
notifications.
sessions, and if, before the expiry of the session immediately following the session or the
successive sessions aforesaid, both Houses agree in making any modification in the rule or
regulation or in the notification, as the case may be, or both Houses agree that the rule or
regulation or the notification should not be made, the rule or regulation or notification, as
the case may be, shall thereafter have effect only in such modified form or be of no effect,
as the case may be; so, however, that any such modification or annulment shall be without
prejudice to the validity of anything previously done under that rule or regulation or
notification, as the case may be.
25. (1) If any difficulty arises in giving effect to any provision of this Act, the Removal of
Government may, on the recommendations of the Council, by a general or a special order difficulties.
published in the Official Gazette, make such provisions not inconsistent with the provisions
of this Act or the rules or regulations made thereunder, as may be necessary or expedient
for the purpose of removing the said difficulty:
Provided that no such order shall be made after the expiry of a period of three years
from the date of commencement of this Act.
(2) Every order made under this section shall be laid, as soon as may be, after it is
made, before each House of Parliament.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 143
STATEMENT OF OBJECTS AND REASONS
Presently, article 269 of the Constitution empowers the Parliament to make law on
the taxes to be levied on the sale or purchase taking place in the course of
inter-State trade or commerce. Accordingly, Parliament had enacted the Central Sales
Tax Act, 1956 for levy of central sales tax on the sale taking place in the course of
inter-State trade or commerce. The central sales tax is being collected and retained by
the exporting States.
2. The crucial aspect of central sales tax is that it is non-vatable, i.e. the credit of
this tax is not available as set-off for the future tax liability to be discharged by the
purchaser. It directly gets added to the cost of the goods purchased and becomes part
of the cost of business and thereby has a direct impact on the increase in the cost of
production of a particular product. Further, the fact that the rate of central sales tax is
different from the value added tax being levied on the intra-State sale creates a tax
arbitrage which is exploited by unscrupulous elements.
3. In view of the above, it has become necessary to have a Central legislation,
namely, the Integrated Goods and Services Tax Bill, 2017. The proposed Legislation
will confer power upon the Central Government for levying goods and services tax on
the supply of goods or services or both which takes place in the course of inter-State
trade or commerce. The proposed Legislation will remove both the lacunas of the present
central sales tax. Besides being vatable, the rate of tax for the integrated goods and
services tax is proposed to be more or less equal to the sum total of the central goods
and services tax and state goods and services tax or Union territory goods and services
tax to be levied on intra-State supplies. It is expected to reduce cost of production and
inflation in the economy, thereby making the Indian trade and industry more competitive,
domestically as well as internationally. It is also expected that introduction of the
integrated goods and services tax will foster a common or seamless Indian market and
contribute significantly to the growth of the economy.
4. The Integrated Goods and Services Tax Bill, 2017, inter alia, provides for the
following, namely:—
(a) to levy tax on all inter-State supplies of goods or services or both except
supply of alcoholic liquor for human consumption at a rate to be notified, not
exceeding forty per cent. as recommended by the Goods and Services Tax Council
(the Council);
(b) to provide for levy of tax on goods imported into India in accordance
with the provisions of the Customs Tariff Act, 1975 read with the provisions
contained in the Customs Act, 1962;
(c) to provide for levy of tax on import of services on reverse charge basis
under the proposed Legislation;
(d) to empower the Central Government to grant exemptions, by notification
or by special order, on the recommendations of the Council;
(e) to provide for determination of the nature of supply as to whether it is
an inter-State or an intra-State supply;
(f) to provide elaborate provisions for determining the place of supply in
relation to goods or services or both;
(g) to provide for payment of tax by a supplier of online information and
database access or retrieval services;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 144
(h) to provide for refund of tax paid on supply of goods to tourist leaving
India;
(i) to provide for apportionment of tax and settlement of funds and for
transfer of input tax credit between the Central Government, State Government
and Union territory;
(j) to provide for application of certain provisions of the Central Goods
and Services Tax Act, 2017, inter alia, relating to definitions, time and value of
supply, input tax credit, registration, returns other than late fee, payment of tax,
assessment, refunds, audit, inspection, search, seizure and arrest, demands and
recovery, appeals and revision, offences and penalties and transitional provisions,
in the proposed Legislation; and
(k) to provide for transitional transactions in relation to import of services
made on or after the appointed day.
5. The Notes on clauses explain in detail the various provisions contained in the
Integrated Goods and Services Tax Bill, 2017.
6. The Bill seeks to achieve the above objectives.
NEW DELHI; ARUN JAITLEY.
The 23rd March, 2017.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 145
Notes on clauses
Clause 1 provides for short title, extent and commencement of the proposed Act.
Clause 2 defines various terms and expressions used in the proposed Act.
Clause 3 provides for appointment of Commissioners and other class of officers
as may be required for carrying out the purposes of the proposed Act.
Clause 4 provides for authorisation of State tax and Union territory tax officers,
subject to certain exceptions and conditions as shall be notified by the Central
Government on recommendations of the Council, to be proper officers for the purposes
of the proposed Act.
Clause 5 provides for levy and collection of integrated tax on all inter-State
supplies of goods or services or both except on the supply of alcoholic liquor for
human consumption, on the value determined under section 15 of the Central Goods
and Services Tax Act at a rate not exceeding forty per cent. It further provides that
integrated tax on goods imported into India shall be levied and collected under
section 3 of the Customs Tariff Act, 1975, at the time and in the manner in which
customs duty shall be collected under the provisions of the Customs Act, on a value as
determined under the provisions of the Customs Tariff Act. This clause also provides
that —
(i) integrated tax on the supply of petroleum crude, high speed diesel, motor
spirit (commonly known as petrol), natural gas and aviation turbine fuel to be
levied with effect from a date notified by the Central Government on the
recommendations of the Council;
(ii) the Central Government to notify categories of supply of goods or
services or both, the tax on which shall be paid on reverse charge basis by the
recipient of such goods or services or both, on the recommendations of the
Council;
(iii) the integrated tax in respect of the supply of taxable goods or services
or both by a supplier, who is not registered, to a registered person shall be paid
by such person on reverse charge basis;
(iv) the Central Government may notify categories of services, the tax on
inter-State supplies of which shall be paid by the electronic commerce operator
if such services are supplied through it, on the recommendations of the Council.
Clause 6 confers powers on Central Government to exempt either absolutely or
conditionally goods or services or both of any specified description from the whole or
part of the integrated tax, on the recommendations of the Council. This clause also
confers powers on the Central Government to exempt from payment of tax any goods
or services or both, by special order, on which tax is leviable on the recommendations
of the Council.
Clause 7 provides for instances where a supply of goods or services or both will
be considered as inter- State supply.
Clause 8 provides for instances where a supply of goods or services or both will
be considered as intra- State supply.
Clause 9 provides for supplies made in territorial waters to be deemed to be
made in the States or Union territories where the nearest point of the appropriate baseline
is located.
Clause 10 provides for the place of supply for all supplies of goods other than
those goods which are imported into or exported out of India.
Clause 11 provides for the place of supply for all supplies of goods which are
imported into or exported out of India.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 146
Clause 12 provides for the place of supply for all supplies of services where
location of supplier and recipient is in India.
Clause 13 provides for the place of supply for all supplies of services where
location of supplier or location of recipient is outside India.
Clause 14 provides for deeming the supplier of services located in non-taxable
territory to be liable to pay tax on the online information and database access or retrieval
services by any person located in a non-taxable territory and received by a non- taxable
online recipient.
Clause 15 provides for refund of integrated tax paid on supply of goods to tourists
leaving India.
Clause 16 provides for zero rating of certain supplies namely exports and supplies
made to Special Economic Zone Unit or Special Economic Zone developer and the
manner of zero rating.
Clause 17 provides for apportionment of integrated tax and settlement of funds
between the Central and State Government.
Clause 18 provides for utilisation of credit of integrated tax availed under the
proposed Act for payment of central tax, Union territory tax or State tax.
Clause 19 provides for refund of integrated tax in situations where inter-State
supplies are subsequently held to be intra-State supplies.
Clause 20 provides for application of specific provisions of the Central Goods
and Services Tax Act to the proposed Act.
Clause 21 provides that all import of services made on or after the appointed day
will be liable to integrated tax regardless of whether the transactions for such import of
services had been initiated before the appointed day.
Clause 22 confers powers on the Central Government to make rules for carrying
out the provisions of the proposed Act on recommendation of the Council.
Clause 23 confers powers on the Board to make regulations for carrying out the
provisions of the proposed Act.
Clause 24 provides for laying of rules, regulations and notifications made by the
Central Government before each House of the Parliament.
Clause 25 confers powers on the Central Government to make such provisions
not inconsistent with the provisions of the proposed Act or the rules or regulations by
a general or special order, on the recommendations of the Council within a period of
three years from the date of commencement of the proposed Act.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 147
FINANCIAL MEMORANDUM
Clauses 17 and 18 of the Bill provides for apportionment of tax and settlement of funds
and for transfer of input tax credit between the Central Government, State Government and
Union territory.
2. Clause 20 of the Bill provides for application of provisions of the Central Goods and
Services Tax Bill, 2017 relating to appeals, advance ruling and anti-profiteering. So authori-
ties under the Central Goods and Services Tax Act will be utilised for the purposes of the
proposed legislation. Thus there will be no extra financial expenditure under this
Bill.
3. The total financial implications in terms of recurring and non-recurring expenditure
involved in carrying out the various functions under the Bill would be borne by the Central
Government. Most of the existing officers and staff of the Central Board of Excise and
Customs would be used for carrying out the various functions under the Bill. However, it is
not possible to estimate the exact recurring and non-recurring expenditure from the
Consolidated Fund of India at this stage.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 148
MEMORANDUM REGARDING DELEGATED LEGISLATION
Clause 22 of the Integrated Goods and Services Tax Bill seeks to empower the
Central Government to make rules, inter alia, in the following matters, namely:—
(a) collection of taxes under section 5; (b) determination of place of supply
under section 10; (c) apportionment of value of supply of services when the
immovable property or boat or vessel is located in more than one State or Union
or when the leased circuit is installed in more than one State or Union territory or
when the event is held in more than one State or Union territory or for
advertisement services under section 12; (d) the place of supply of services referred
to in section 13 when they are supplied in more than one State or Union territory
under that section; (e) conditions and safeguards for refund of integrated tax
paid on supply of goods to tourist leaving India under section 15; (f) procedure
and safeguards for supply of goods or services under bond or on payment of
integrated tax and then taking refund under section 16; (g) manner in which
apportionment of tax and settlement of funds will take place under section 17;
(h) manner and time in which input tax credit will be transferred under section 18;
(i) manner in which tax wrongfully collected and paid to Central Government or
State Government is to be refunded under section 19; and (j) any other matter
which is to be, or may be, prescribed, or in respect of which provision is to be
made, by rules.
2. Clause 23 of the Bill empowers the Board to make regulations to provide for
any matter which is required to be, or may be, specified by regulation or in respect of
which provision is to be made by regulations.
3. The matters in respect of which the said rules and regulations may be made
are matters of procedure and administrative detail, and as such, it is not practicable to
provide for them in the proposed Bill itself. The delegation of legislative power is,
therefore, of a normal character.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 149
BILL NO. 60 OF 2017
A Bill to provide for compensation to the States for the loss of revenue arising on account
of implementation of the goods and services tax in pursuance of the provisions of the
Constitution (One Hundred and First Amendment) Act, 2016.
BE it enacted by Parliament in the Sixty-eighth Year of the Republic of India as follows:—
1. (1) This Act may be called the Goods and Services Tax (Compensation to States) Short title,
Act, 2017. extent and
commencement.
(2) It extends to the whole of India.
(3) It shall come into force on such date as the Central Government may, by notification
in the Official Gazette, appoint.
2. (1) In this Act, unless the context otherwise requires,— Definitions.
(a) “central tax” means the central goods and services tax levied and collected
under the Central Goods and Services Tax Act;150 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(b) “Central Goods and Services Tax Act” means the Central Goods and Services
Tax Act, 2017;
(c) “cess” means the goods and services tax compensation cess levied under
section 8;
(d) “compensation” means an amount, in the form of goods and services tax
compensation, as determined under section 7;
(e) “Council” means the Goods and Services Tax Council constituted under the
provisions of article 279A of the Constitution;
(f) “Fund” means the Goods and Services Tax Compensation Fund referred to in
section 10;
(g) “input tax” in relation to a taxable person, means,––
(i) cess charged on any supply of goods or services or both made to him;
(ii) cess charged on import of goods and includes the cess payable on
reverse charge basis;
(h) “Integrated Goods and Services Tax Act” means the Integrated Goods and
Services Tax Act, 2017;
(i) “integrated tax” means the integrated goods and services tax levied and
collected under the Integrated Goods and Services Tax Act;
(j) “prescribed” means prescribed by rules made, on the recommendations of the
Council, under this Act;
(k) “projected growth rate” means the rate of growth projected for the transition
period as per section 3;
(l) “Schedule” means the Schedule appended to this Act;
(m) “State” means,––
(i) for the purposes of sections 3, 4, 5, 6 and 7 the States as defined under
the Central Goods and Services Tax Act; and
(ii) for the purposes of sections 8, 9, 10, 11, 12, 13 and 14 the States as
defined under the Central Goods and Services Tax Act and the Union territories
as defined under the Union Territories Goods and Services Tax Act;
(n) “State tax” means the State goods and services tax levied and collected
under the respective State Goods and Services Tax Act;
(o) “State Goods and Services Tax Act” means the law to be made by the State
Legislature for levy and collection of tax by the concerned State on supply of goods or
services or both;
(p) “taxable supply’’ means a supply of goods or services or both which is
chargeable to the cess under this Act;
(q) “transition date” shall mean, in respect of any State, the date on which the
State Goods and Services Tax Act of the concerned State comes into force;
(r) “transition period” means a period of five years from the transition date; and
(s) “Union Territories Goods and Services Tax Act” means the Union Territories
Goods and Services Tax Act, 2017.
(2) The words and expressions used and not defined in this Act but defined in the
Central Goods and Services Tax Act and the Integrated Goods and Services Tax Act shall
have the meanings respectively assigned to them in those Acts.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 151
3. The projected nominal growth rate of revenue subsumed for a State during the Projected
transition period shall be fourteen per cent. per annum. growth rate.
4. For the purpose of calculating the compensation amount payable in any financial Base year.
year during the transition period, the financial year ending 31st March, 2016, shall be taken as
the base year.
5. (1) Subject to the provision of sub-sections (2), (3), (4), (5) and (6), the base year Base year
revenue for a State shall be the sum of the revenue collected by the State and the local bodies revenue.
during the base year, on account of the taxes levied by the respective State or Union and net
of refunds, with respect to the following taxes, imposed by the respective State or Union,
which are subsumed into goods and services tax, namely:––
(a) the value added tax, sales tax, purchase tax, tax collected on works contract,
or any other tax levied by the concerned State under the erstwhile entry 54 of List-II
(State List) of the Seventh Schedule to the Constitution;
74 of 1956. (b) the central sales tax levied under the Central Sales Tax Act, 1956;
(c) the entry tax, octroi, local body tax or any other tax levied by the concerned
State under the erstwhile entry 52 of List-II (State List) of the Seventh Schedule to the
Constitution;
(d) the taxes on luxuries, including taxes on entertainments, amusements, betting
and gambling or any other tax levied by the concerned State under the erstwhile entry
62 of
List-II (State List) of the Seventh Schedule to the Constitution;
(e) the taxes on advertisement or any other tax levied by the concerned State
under the erstwhile entry 55 of List-II (State List) of the Seventh Schedule to the
Constitution;
(f) the duties of excise on medicinal and toilet preparations levied by the Union
but collected and retained by the concerned State Government under the erstwhile
article 268 of the Constitution;
(g) any cess or surcharge or fee leviable under entry 66 read with entries 52, 54,
55 and 62 of List-II of the Seventh Schedule to the Constitution by the State Government
under any Act notified under sub-section (4),
prior to the commencement of the provisions of the Constitution (One Hundred and First
Amendment) Act, 2016:
Provided that the revenue collected during the base year in a State, net of refunds,
under the following taxes shall not be included in the calculation of the base year revenue for
that State, namely:—
(a) any taxes levied under any Act enacted under the erstwhile entry 54 of List-II
(State List) of the Seventh Schedule to the Constitution, prior to the coming into force
of the provisions of the Constitution (One Hundred and First Amendment) Act, 2016,
on the sale or purchase of petroleum crude, high speed diesel, motor spirit (commonly
known as petrol), natural gas, aviation turbine fuel and alcoholic liquor for human
consumption;
74 of 1956. (b) tax levied under the Central Sales Tax Act, 1956, on the sale or purchase of
petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural
gas, aviation turbine fuel and alcoholic liquor for human consumption;
(c) any cess imposed by the State Government on the sale or purchase of
petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural
gas, aviation turbine fuel and alcoholic liquor for human consumption; and
(d) the entertainment tax levied by the State but collected by local bodies, under
any Act enacted under the erstwhile entry 62 of List-II (State List) of the Seventh
Schedule to the Constitution, prior to coming into force of the provisions of the
Constitution (One Hundred and First Amendment) Act, 2016.152 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(2) In respect of the State of Jammu and Kashmir, the base year revenue shall include
the amount of tax collected on sale of services by the said State Government during the base
year.
(3) In respect of the States mentioned in sub-clause (g) of clause (4) of article 279A of
the Constitution, the amount of revenue foregone on account of exemptions or remission
given by the said State Governments to promote industrial investment in the State, with
respect to such specific taxes referred to in sub-section (1), shall be included in the total base
year revenue of the State, subject to such conditions as may be prescribed.
(4) The Acts of the Central Government and State Governments under which the
specific taxes are being subsumed into the goods and services tax shall be such as may be
notified.
(5) The base year revenue shall be calculated as per sub-sections (1), (2), (3) and (4)
on the basis of the figures of revenue collected and net of refunds given in that year, as
audited by the Comptroller and Auditor-General of India.
(6) In respect of any State, if any part of revenues mentioned in sub-sections (1), (2),
(3) and (4) are not credited in the Consolidated Fund of the respective State, the same shall
be included in the total base year revenue of the State, subject to such conditions as may be
prescribed.
Projected 6. The projected revenue for any year in a State shall be calculated by applying the
revenue for projected growth rate over the base year revenue of that State.
any year.
Illustration.—If the base year revenue for 2015-16 for a concerned State, calculated as
per section 5 is one hundred rupees, then the projected revenue for financial
year 2018-19 shall be as follows—
Projected Revenue for 2018-19-100 (1+14/100)3
Calculation 7. (1) The compensation under this Act shall be payable to any State during the
and release of transition period.
compensation.
(2) The compensation payable to a State shall be provisionally calculated and released
at the end of every two months period, and shall be finally calculated for every financial year
after the receipt of final revenue figures, as audited by the Comptroller and Auditor-General
of India:
Provided that in case any excess amount has been released as compensation to a State
in any financial year during the transition period, as per the audited figures of revenue
collected, the excess amount so released shall be adjusted against the compensation amount
payable to such State in the subsequent financial year.
(3) The total compensation payable for any financial year during the transition period
to any State shall be calculated in the following manner, namely:––
(a) the projected revenue for any financial year during the transition period,
which could have accrued to a State in the absence of the goods and services tax, shall
be calculated as per section 6;
(b) the actual revenue collected by a State in any financial year during the
transition period shall be—
(i) the actual revenue from State tax collected by the State, net of
refunds given by the said State under Chapters XI and XX of the State
Goods and Services Tax Act;
(ii) the integrated goods and services tax apportioned to that State;
and
(iii) any collection of taxes on account of the taxes levied by the
respective State under the Acts specified in sub-section (4) of section 5,
net of refunds of such taxes,
as certified by the Comptroller and Auditor-General of India;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 153
(c) the total compensation payable in any financial year shall be the difference
between the projected revenue for any financial year and the actual revenue collected
by a State referred to in clause (b).
(4) The loss of revenue at the end of every two months period in any year for a State
during the transition period shall be calculated, at the end of the said period, in the following
manner, namely:––
(a) the projected revenue that could have been earned by the State in absence of
the goods and services tax till the end of the relevant two months period of the
respective financial year shall be calculated on a pro-rata basis as a percentage of the
total projected revenue for any financial year during the transition period, calculated in
accordance with section 6.
Illustration—If the projected revenue for any year calculated in accordance
with section 6 is one hundred rupees, for calculating the projected revenue that could
be earned till the end of the period of ten months for the purpose of this
sub-section shall be 100x(5/6)=Rs.83.33.);
(b) the actual revenue collected by a State till the end of relevant two months
period in any financial year during the transition period shall be—
(i) the actual revenue from State tax collected by the State, net of refunds
given by the State under Chapters XI and XX of the State Goods and Services
Tax Act;
(ii) the integrated goods and services tax apportioned to that State, as
certified by the Principal Chief Controller of Accounts of the Central Board of
Excise and Customs; and
(iii) any collection of taxes levied by the said State, under the Acts specified
in sub-section (4) of section 5, net of refund of such taxes;
(c) the provisional compensation payable to any State at the end of the relevant
two month period in any financial year shall be the difference between the projected
revenue till the end of the relevant period in accordance with clause (a) and the actual
revenue collected by a State in the said period as referred to in clause (b), reduced by
the provisional compensation paid to a State till the end of the previous two months
period in the said financial year during the transition period.
(5) In case of any difference between the final compensation amount payable to a State
calculated in accordance with the provisions of sub-section (3) upon receipt of the audited
revenue figures from the Comptroller and Auditor-General of India, and the total provisional
compensation amount released to a State in the said financial year in accordance with the
provisions of sub-section (4), the same shall be adjusted against release of compensation to
the State in the subsequent financial year.
(6) Where no compensation is due to be released in any financial year, and in case any
excess amount has been released to a State in the previous year, this amount shall be
refunded by the State to the Central Government and such amount shall be credited to the
Fund in such manner as may be prescribed.
8. (1) There shall be levied a cess on such intra-State supplies of goods or services or Levy and
both, as provided for in section 9 of the Central Goods and Services Tax Act, and such inter- collection of
State supplies of goods or services or both as provided for in section 5 of the Integrated cess.
Goods and Services Tax Act, and collected in such manner as may be prescribed, on the
recommendations of the Council, for the purposes of providing compensation to the States
for loss of revenue arising on account of implementation of the goods and services tax with
effect from the date from which the provisions of the Central Goods and Services Tax Act is
brought into force, for a period of five years or for such period as may be prescribed on the
recommendations of the Council:154 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Provided that no such cess shall be leviable on supplies made by a taxable person who
has decided to opt for composition levy under section 10 of the Central Goods and Services
Tax Act.
(2) The cess shall be levied on such supplies of goods and services as are specified in
column (2) of the Schedule, on the basis of value, quantity or on such basis at such rate not
exceeding the rate set forth in the corresponding entry in column (4) of the Schedule, as the
Central Government may, on the recommendations of the Council, by notification in the
Official Gazette, specify:
Provided that where the cess is chargeable on any supply of goods or services or both
with reference to their value, for each such supply the value shall be determined under
section 15 of the Central Goods and Services Tax Act for all intra-State and inter-State
supplies of goods or services or both:
Provided further that the cess on goods imported into India shall be levied and collected
in accordance with the provisions of section 3 of the Customs Tariff Act, 1975, at the point
51 of 1975.
when duties of customs are levied on the said goods under section 12 of the Customs
Act, 1962, on a value determined under the Customs Tariff Act, 1975. 52 of 1962.
Returns, 9. (1) Every taxable person, making a taxable supply of goods or services or both,
payments and shall—
refunds.
(a) pay the amount of cess as payable under this Act in such manner;
(b) furnish such returns in such forms, along with the returns to be filed under
the Central Goods and Services Tax Act; and
(c) apply for refunds of such cess paid in such form,
as may be prescribed.
(2) For all purposes of furnishing of returns and claiming refunds, except for the form
to be filed, the provisions of the Central Goods and Services Tax Act and the rules made
thereunder, shall, as far as may be, apply in relation to the levy and collection of the cess
leviable under section 8 on all taxable supplies of goods or services or both, as they apply in
relation to the levy and collection of central tax on such supplies under the said Act or the
rules made thereunder.
Crediting 10. (1) The proceeds of the cess leviable under section 8 and such other amounts as
proceeds of may be recommended by the Council, shall be credited to a non-lapsable Fund known as the
cess to Fund.
Goods and Services Tax Compensation Fund, which shall form part of the public account of
India and shall be utilised for purposes specified in the said section.
(2) All amounts payable to the States under section 7 shall be paid out of the Fund.
(3) Fifty per cent. of the amount remaining unutilised in the Fund at the end of the
transition period shall be transferred to the Consolidated Fund of India as the share of
Centre, and the balance fifty per cent. shall be distributed amongst the States in the ratio of
their total revenues from the State tax or the Union territory goods and services tax, as the
case may be, in the last year of the transition period.
(4) The accounts relating to Fund shall be audited by the Comptroller and
Auditor-General of India or any person appointed by him at such intervals as may be specified
by him and any expenditure in connection with such audit shall be payable by the Central
Government to the Comptroller and Auditor-General of India.
(5) The accounts of the Fund, as certified by the Comptroller and Auditor-General of
India or any other person appointed by him in this behalf together with the audit report
thereon shall be laid before each House of Parliament.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 155
11. (1) The provisions of the Central Goods and Services Tax Act, and the rules made Other
thereunder, including those relating to assessment, input tax credit, non-levy, short-levy, provisions
relating to
interest, appeals, offences and penalties, shall, as far as may be, mutatis mutandis, apply, in
cess.
relation to the levy and collection of the cess leviable under section 8 on the intra-State
supply of goods and services, as they apply in relation to the levy and collection of central
tax on such intra-State supplies under the said Act or the rules made thereunder.
(2) The provisions of the Integrated Goods and Services Tax Act, and the rules made
thereunder, including those relating to assessment, input tax credit, non-levy, short-levy,
interest, appeals, offences and penalties, shall, mutatis mutandis, apply in relation to the
levy and collection of the cess leviable under section 8 on the inter-State supply of goods
and services, as they apply in relation to the levy and collection of integrated tax on such
inter State supplies under the said Act or the rules made thereunder:
Provided that the input tax credit in respect of cess on supply of goods and services
leviable under section 8, shall be utilised only towards payment of said cess on supply of
goods and services leviable under the said section.
12. (1) The Central Government shall, on the recommendations of the Council, by Power to
notification in the Official Gazette, make rules for carrying out the provisions of this Act. make rules.
(2) In particular, and without prejudice to the generality of the foregoing power, such
rules may provide for all or any of the following matters, namely:—
(a) the conditions which were included in the total base year revenue of the
States, referred to in sub-clause (g) of clause (4) of article 279A of the Constitution,
under sub-section (3) of section 5;
(b) the conditions subject to which any part of revenues not credited in the
Consolidated Fund of the respective State shall be included in the total base year
revenue of the State, under sub-section (6) of section 5;
(c) the manner of refund of compensation by the States to the Central Government
under sub-section (6) of section 7;
(d) the manner of levy and collection of cess and the period of its imposition
under sub-section (1) of section 8;
(e) the manner and forms for payment of cess, furnishing of returns and refund
of cess under sub-section (1) of section 9; and
(f) any other matter which is to be, or may be, prescribed, or in respect of which
provision is to be made, by rules.
13. Every rule made under this Act by the Central Government shall be laid, as soon as Laying of
may be after it is made, before each House of Parliament, while it is in session, for a total rules before
Parliament.
period of thirty days which may be comprised in one session or in two or more successive
sessions, and if, before the expiry of the session immediately following the session or
successive sessions aforesaid, both Houses agree in making any modification in the rule or
both Houses agree that the rule should not be made, the rule shall thereafter have effect only
in such modified form or be of no effect, as the case may be; so, however, that any such
modification or annulment shall be without prejudice to the validity of anything previously
done under that rule.
14. (1) If any difficulty arises in giving effect to the provisions of this Act, the Central Power to
Government may, on the recommendations of the Council, by order published in the Official remove
difficulties.
Gazette, make such provisions, not inconsistent with the provisions of this Act, as appear to
it to be necessary or expedient for removing the difficulty:
Provided that no order shall be made under this section after the expiry of three years
from the commencement of this Act.
(2) Every order made under this section shall, as soon as may be after it is made, be laid
before each House of Parliament.156 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
THE SCHEDULE
[See section 8 (2)]
1. In this Schedule, reference to a “tariff item”, “heading”, “sub-heading” and
“Chapter”, wherever they occur, shall mean respectively a tariff item, heading, sub-heading
and Chapter in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975).
2. The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975
(51 of 1975), the section and Chapter Notes and the General Explanatory Notes of the First
Schedule shall, so far as may be, apply to the interpretation of this Schedule.
Sl. No. Description of supply of Tariff item, heading, The maximum rate at which
goods or services sub-heading, Chapter, goods and services tax
or supply of goods or compansation cess may be
services, as the case collected
may be
(1) (2) (3) (4)
1. Pan Masala. 2106 90 20 One hundred and thirty-five
per cent. ad valorem.
2. Tobacco and manufactured 24 Four thousand one hundred
tobacco substitutes, including and seventy rupees per
tobacco products. thousand sticks or two
hundred and ninety per cent.
ad valorem or a combination
thereof, but not exceeding
four thousand one hundred
and seventy rupees per
thousand sticks plus two
hundred and ninety per cent.
ad valorem.
3. Coal, briquettes, ovoids and 2701, 2702 or 2703 Four hundred rupees per tonne.
similar solid fuels manufac-
tured from coal, lignite,
whether or not agglomerated,
excluding jet, peat (including
peat litter), whether or not
agglomerated.
4. Aerated waters. 2202 10 10 Fifteen per cent. ad valorem.
5. Motor cars and other motor 8703 Fifteen per cent. ad valorem.
vehicles principally designed
for the transport of persons
(other than motor vehicles
for the transport of ten or
more persons, including the
driver), including station
wagons and racing cars.
6. Any other supplies. Fifteen per cent. ad valorem.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 157
STATEMENT OF OBJECTS AND REASONS
The Goods and Services Tax (Compensation to States) Bill, 2017, provides for payment
of compensation to the States for loss of revenue arising on account of implementation of
the goods and services tax for a period of five years in accordance with the provisions of
section 18 of the Constitution (One Hundred and First Amendment) Act, 2016.
2. The Constitution (One Hundred and First Amendment) Act, 2016, has amended the
Constitution to facilitate the introduction of goods and services tax in the Country. The
amendments made in the Constitution confer simultaneous powers upon Parliament and the
State Legislatures to make laws for levy of goods and services tax on the supplies of goods
or services or both. Section 18 of the Constitution (One Hundred and First Amendment)
Act, 2016, provides that, "Parliament shall, by law, on the recommendations of the Goods
and Services Tax Council, provide for compensation to the States for loss of revenue arising
on account of implementation of the goods and services tax for a period of five years.".
3. The Goods and Services Tax (Compensation to States) Bill, 2017, inter alia, provides
for the following, namely:—
(a) to provide that the financial year 2015-16 shall be taken as the base year for
the purpose of calculating compensation amount payable to States;
(b) the revenue to be compensated shall consist of revenues from all taxes
levied by the States which are now proposed to be subsumed under the goods and
services tax, as audited by the Comptroller and Auditor-General of India;
(c) the projected nominal growth rate of revenue subsumed for a State during
the transition period shall be fourteen per cent. per annum;
(d) to provide that the compensation shall be released bi-monthly against the
figures given by the Central accounting authorities provisionally and final adjustment
shall be done after getting audited accounts of the year from the Comptroller and
Auditor-General of India;
(e) to provide that in case of the eleven Special category States referred to in
article 279A of the Constitution, the revenue foregone on account of exemption of
taxes granted by States shall be counted towards the definition of Revenue for the
base year 2015-16;
(f) the revenues of States that were not credited to the Consolidated Fund of the
States but were directly devolved to "mandi" or "municipalities" would also be included
in the definition of 'revenue subsumed' if these were collected under the authority of
entries 52, 54, 55 and 62 of List-II of Seventh Schedule of the Constitution and were
subsumed in the goods and services tax;
(g) to generate resources to compensate States for five years for any loss of
revenue suffered by them on account of implementation of goods and services tax, a
cess shall be levied on such goods, as recommended by the Goods and Services Tax
Council, over and above the goods and services tax on that item;
(h) the proceeds of the goods and services tax compensation cess shall be
credited to a non-lapsable Fund known as the Goods and Services Tax Compensation
Fund in the Public Account and all amounts payable to the States as goods and
services tax compensation shall be paid from the Goods and Services Tax Compensation
Fund; and
(i) any residual amount left in the Compensation Fund after five year
compensation period shall be shared equally between the Centre and the States.158 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Fifty per cent. of the amount remaining unutilised in the Goods and Services Tax
Compensation Fund at the end of the transition period shall be transferred to the
Consolidated Fund of India as the share of the Centre, and the balance fifty per cent.
shall be distributed amongst the States and Union territories in the ratio of their total
revenues from the State goods and services tax or the Union territory goods and
services tax, as the case may be, in the last year of the transition period.
4. The Bill seeks to achieve the above objectives.
NEW DELHI; ARUN JAITLEY.
The 23rd March, 2017.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 159
FINANCIAL MEMORANDUM
Clause 10 of the Bill seeks to provide that the proceeds of the goods and services tax
compensation cess, as well as such other amounts as may be recommended by the Goods
and Services Tax Council, shall be credited to a non-lapsable Fund known as the Goods and
Services Tax Compensation Fund, which shall form part of the public account of India and
shall be utilised for purposes specified in the clause 8 of the Bill. Sub-clause (3) of clause 10
of the Bill seeks to provide that fifty per cent. of the amount remaining unutilised in the
goods and services tax compensation fund at the end of the transition period shall be
transferred to the Consolidated Fund of India as the share of Centre, and the balance fifty
per cent. shall be distributed amongst the States and the Union territories in the ratio of their
total revenues from the State goods and services tax or the Union territory goods and
services tax, as the case may be, in the last year of the transition period.
2. Since the central goods and services tax rate shall be arrived at so as to protect the
present revenues of the Central Government from the indirect taxes being subsumed under
goods and services tax, the Union Government would need additional source of revenue to
compensate any State which may suffer drop in revenue collection on account of
implementation of goods and services tax. Clause 8 of the Bill, thus, proposes to levy a
goods and services tax compensation cess, the proceeds of which shall be used directly for
the payments of goods and services tax compensation to the States.
——————
MEMORANDUM REGARDING DELEGATED LEGISLATION
Clause 5 of the Bill seeks to provide the detailed procedure for calculating the base
year revenue of a State on the recommendations of the Goods and Services Tax Council.
Sub-clause (3) of the said clause empowers the Central Government to prescribe the conditions
subject to which, the amount of revenue foregone on account of exemptions or remission
given by a State Government to promote industrial investment in the said State would be
included in the total base year revenue of the States, in respect of States referred to in
sub-clause (g) of clause (4) of article 279A of the Constitution. Sub-clause (6) of the
clause 5 empowers the Central Government to prescribe the conditions subject to which, any
part of revenues not credited in the Consolidated Fund of a State shall be included in the
total base year revenue of the concerned State.
2. Clause 7 of the Bill seeks to provide the detailed procedure for calculating and
releasing the goods and services tax compensation amount to a State. Sub-clause (6) of
clause 7 empowers the Central Government to prescribe the manner of refund of compensation
by a State to the Central Government, in case excess goods and services tax compensation is
paid to the said State by the Central Government.
3. Clause 8 of the Bill seeks to levy a goods and services tax compensation cess on certain
supplies of goods and services. Sub-clause (1) of clause 8 empowers the Central Government
to notify the manner of levy and collection of the cess and the period of its imposition.
4. Clause 9 of the Bill seeks to provide that every taxable person shall pay the cess,
furnish returns and apply for any refund due. Sub-clause (1) of clause 9 empowers the
Central Government to make rules for prescribing the manner and forms for payment of cess,
furnishing of returns and refund of cess.
5. The matters in respect of which notifications may be issued or rules may be made in
accordance with the aforesaid provisions of the Bill are matters of procedure and detail and
it is not practicable to provide for the same in the Bill itself. The delegation of legislative
power is, therefore, of a normal character.160 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
BILL NO. 59 OF 2017
A Bill to make a provision for levy and collection of tax on intra-State supply of goods or
services or both by the Union territories and the matter connected therewith or
incidental thereto.
BE it enacted by Parliament in the Sixty-eighth Year of the Republic of India as
follows:—
CHAPTER I
PRELIMINARY
Short title, 1. (1) This Act may be called the Union Territory Goods and Services Tax Act, 2017.
extent and
(2) It extends to the Union territories of the Andaman and Nicobar Islands,
commencement.
Lakshadweep, Dadra and Nagar Haveli, Daman and Diu, Chandigarh and other territory.
(3) It shall come into force on such date as the Central Government may, by notification
in the Official Gazette, appoint:
Provided that different dates may be appointed for different provisions of this Act
and any reference in any such provision to the commencement of this Act shall be construed
as a reference to the coming into force of that provision.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 161
2. In this Act, unless the context otherwise requires,— Definitions.
(1) ‘‘appointed day’’ means the date on which the provisions of this Act shall
come into force;
(2) ‘‘Commissioner’’ means the Commissioner of Union territory tax appointed
under section 3;
(3) ‘‘designated authority’’ means such authority as may be notified by the
Commissioner;
(4) ‘‘exempt supply’’ means supply of any goods or services or both which
attracts nil rate of tax or which may be exempt from tax under section 8, or under
section 6 of the Integrated Goods and Services Tax Act, and includes non-taxable
supply;
(5) ‘‘existing law’’ means any law, notification, order, rule or regulation relating
to levy and collection of duty or tax on goods or services or both passed or made
before the commencement of this Act by Parliament or any Authority or person having
the power to make such law, notification, order, rule or regulation;
(6) ‘‘Government’’ means the Administrator or any Authority or officer authorised
to act as Administrator by the Central Government;
(7) ‘‘output tax’’ in relation to a taxable person, means the Union territory tax
chargeable under this Act on taxable supply of goods or services or both made by
him or by his agent but excludes tax payable by him on reverse charge basis;
(8) ‘‘Union territory’’ means the territory of,—
(i) the Andaman and Nicobar Islands;
(ii) Lakshadweep;
(iii) Dadra and Nagar Haveli;
(iv) Daman and Diu;
(v) Chandigarh; or
(vi) other territory.
Explanation.—For the purposes of this Act, each of the territories specified
in sub-clauses (i) to (vi) shall be considered to be a separate Union territory;
(9) ‘‘Union territory tax’’ means the tax levied under this Act;
(10) words and expressions used and not defined in this Act but defined in the
Central Goods and Services Tax Act, the Integrated Goods and Services Tax Act, the
State Goods and Services Tax Act, and the Goods and Services Tax (Compensation
to States) Act, shall have the same meaning as assigned to them in those Acts.
CHAPTER II
ADMINISTRATION
3. The Administrator may, by notification, appoint Commissioners and such other Officers under
class of officers as may be required for carrying out the purposes of this Act and such this Act.
officers shall be deemed to be proper officers for such purposes as may be specified therein:
Provided that the officers appointed under the existing law shall be deemed to be the
officers appointed under the provisions of this Act.
4. The Administrator may, by order, authorise any officer to appoint officers of Union Authorisation
territory tax below the rank of Assistant Commissioner of Union territory tax for the of officers.
administration of this Act.162 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Powers of 5. (1) Subject to such conditions and limitations as the Commissioner may impose, an
officers. officer of the Union territory tax may exercise the powers and discharge the duties conferred
or imposed on him under this Act.
(2) An officer of a Union territory tax may exercise the powers and discharge the
duties conferred or imposed under this Act on any other officer of a Union territory tax who
is subordinate to him.
(3) The Commissioner may, subject to such conditions and limitations as may be
specified in this behalf by him, delegate his powers to any other officer subordinate to him.
(4) Notwithstanding anything contained in this section, an Appellate Authority shall
not exercise the powers and discharge the duties conferred or imposed on any other officer
of Union territory tax.
Authorisation 6. (1) Without prejudice to the provisions of this Act, the officers appointed under the
of officers of Central Goods and Services Tax Act are authorised to be the proper officers for the purposes
central tax as
of this Act, subject to such conditions as the Government shall, on the recommendations of
proper officer
the Council, by notification, specify.
in certain
circumstances.
(2) Subject to the conditions specified in the notification issued under
sub-section (1),—
(a) where any proper officer issues an order under this Act, he shall also issue
an order under the Central Goods and Services Tax Act, as authorised by the said Act
under intimation to the jurisdictional officer of central tax;
(b) where a proper officer under the Central Goods and Services Tax Act has
initiated any proceedings on a subject matter, no proceedings shall be initiated by the
proper officer under this Act on the same subject matter.
(3) Any proceedings for rectification, appeal and revision, wherever applicable, of
any order passed by an officer appointed under this Act, shall not lie before an officer
appointed under the Central Goods and Services Tax Act.
CHAPTER III
LEVY AND COLLECTION OF TAX
Levy and 7. (1) Subject to the provisions of sub-section (2), there shall be levied a tax called the
collection. Union territory tax on all intra-State supplies of goods or services or both, except on the
supply of alcoholic liquor for human consumption, on the value determined under section15
of the Central Goods and Services Tax Act and at such rates, not exceeding twenty per
cent., as may be notified by the Central Government on the recommendations of the
Council and collected in such manner as may be prescribed and shall be paid by the
taxable person.
(2) The Union territory tax on the supply of petroleum crude, high speed diesel,
motor spirit (commonly known as petrol), natural gas and aviation turbine fuel shall be
levied with effect from such date as may be notified by the Central Government on the
recommendations of the Council.
(3) The Central Government may, on the recommendations of the Council, by
notification, specify categories of supply of goods or services or both, the tax on which
shall be paid on reverse charge basis by the recipient of such goods or services or both and
all the provisions of this Act shall apply to such recipient as if he is the person liable for
paying the tax in relation to the supply of such goods or services or both.
(4) The Union territory tax in respect of the supply of taxable goods or services or
both by a supplier, who is not registered, to a registered person shall be paid by such
person on reverse charge basis as the recipient and all the provisions of this Act shall apply
to such recipient as if he is the person liable for paying the tax in relation to the supply of
such goods or services or both.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 163
(5) The Central Government may, on the recommendations of the Council, by
notification, specify categories of services the tax on intra-State supplies of which shall be
paid by the electronic commerce operator if such services are supplied through it, and all
the provisions of this Act shall apply to such electronic commerce operator as if he is the
supplier liable for paying the tax in relation to the supply of such services:
Provided that where an electronic commerce operator does not have a physical
presence in the taxable territory, any person representing such electronic commerce operator
for any purpose in the taxable territory shall be liable to pay tax:
Provided further that where an electronic commerce operator does not have a physical
presence in the taxable territory and also he does not have a representative in the said
territory, such electronic commerce operator shall appoint a person in the taxable territory
for the purpose of paying tax and such person shall be liable to pay tax.
8. (1) Where the Central Government is satisfied that it is necessary in the public Power to grant
interest so to do, it may, on the recommendations of the Council, by notification, exempt exemption from
generally either absolutely or subject to such conditions as may be specified therein, goods tax.
or services or both of any specified description from the whole or any part of the tax leviable
thereon with effect from such date as may be specified in such notification.
(2) Where the Central Government is satisfied that it is necessary in the public interest
so to do, it may, on the recommendations of the Council, by special order in each case,
under circumstances of an exceptional nature to be stated in such order, exempt from payment
of tax any goods or services or both on which tax is leviable.
(3) The Central Government may, if it considers necessary or expedient so to do for
the purpose of clarifying the scope or applicability of any notification issued under
sub-section (1) or order issued under sub-section (2), insert an explanation in such notification
or order, as the case may be, by notification at any time within one year of issue of the
notification under sub-section (1) or order under sub-section (2), and every such explanation
shall have effect as if it had always been the part of the first such notification or order, as
the case may be.
(4) Any notification issued by the Central Government under sub-section (1) of
section 11 or order issued under sub-section (2) of the said section of the Central Goods
and Services Tax Act shall be deemed to be a notification or, as the case may be, an order
issued under this Act.
Explanation.—For the purposes of this section, where an exemption in respect of
any goods or services or both from the whole or part of the tax leviable thereon has been
granted absolutely, the registered person supplying such goods or services or both shall not
collect the tax, in excess of the effective rate, on such supply of goods or services or both.
CHAPTER IV
PAYMENT OF TAX
9. The amount of input tax credit available in the electronic credit ledger of the Payment of
registered person on account of,— tax.
(a) integrated tax shall first be utilised towards payment of integrated tax and
the amount remaining, if any, may be utilised towards the payment of central tax and
State tax, or as the case may be, Union territory tax, in that order;
(c) the Union territory tax shall first be utilised towards payment of Union
territory tax and the amount remaining, if any, may be utilised towards payment of
integrated tax;
(d) the Union territory tax shall not be utilised towards payment of central
tax.164 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Transfer of 10. On utilisation of input tax credit of Union territory tax for payment of tax dues
input tax under the Integrated Goods and Services Tax Act in accordance with the provisions of
credit.
sub-section (5) of section 49 of the Central Goods and Services Tax Act, as reflected in the
valid return furnished under sub-section (1) of section 39 of the Central Goods and Services
Tax Act, the amount collected as Union territory tax shall stand reduced by an amount
equal to such credit so utilised and the Central Government shall transfer an amount equal
to the amount so reduced from the Union territory tax account to the integrated tax account
in such manner and within such time as may be prescribed.
CHAPTER V
INSPECTION, SEARCH, SEIZURE AND ARREST
Officers 11. (1) All officers of Police, Railways, Customs, and those officers engaged in the
required to collection of land revenue, including village officers, and officers of central tax and officers
assist proper
of the State tax shall assist the proper officers in the implementation of this Act.
officers.
(2) The Government may, by notification, empower and require any other class of
officers to assist the proper officers in the implementation of this Act when called upon to
do so by the Commissioner.
CHAPTER VI
DEMANDS AND RECOVERY
Tax 12. (1) A registered person who has paid the central tax and the Union territory tax on
wrongfully a transaction considered by him to be an intra-State supply, but which is subsequently held
collected and
to be an inter-State supply, shall be refunded the amount of taxes so paid in such manner
paid to
and subject to such conditions as may be prescribed.
Central
Government
(2) A registered person who has paid integrated tax on a transaction considered by
or Union
territory him to be an inter-State supply, but which is subsequently held to be an intra-State supply,
Government. shall not be required to pay any interest on the amount of the central tax and the Union
territory tax payable.
Recovery of 13. (1) Where any amount of tax, interest or penalty is payable by a person to the
tax. Government under any of the provisions of this Act or the rules made thereunder and which
remains unpaid, the proper officer of central tax, during the course of recovery of said tax
arrears, may recover the amount from the said person as if it were an arrear of central tax
and credit the amount so recovered to the account of the Government under the appropriate
head of Union terrirtory tax.
(2) Where the amount recovered under sub-section (1) is less than the amount due to
the Government under this Act and the Central Goods and Services Act, the amount to be
credited to the account of the Government shall be in proportion to the amount due as
Union territory tax and central tax.
CHAPTER VII
ADVANCE RULING
Definitions. 14. In this Chapter, unless the context otherwise requires,—
(a) ‘‘advance ruling’’ means a decision provided by the Authority or the Appellate
Authority to an applicant on matters or on questions specified in sub-section (2) of
section 97 or sub-section (1) of section 100 of the Central Goods and Services Tax
Act, in relation to the supply of goods or services or both being undertaken or proposed
to be undertaken by the applicant;
(b) ‘‘Appellate Authority’’ means the Appellate Authority for Advance Ruling
constituted under section 16.
(c) ‘‘applicant’’ means any person registered or desirous of obtaining registration
under this Act;SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 165
(d) ‘‘application’’ means an application made to the Authority under
sub-section (1) of section 97 of the Central Goods and Services Tax Act;
(e) ‘‘Authority’’ means the Authority for Advance Ruling, constituted under
section 15.
15. (1) The Central Government shall, by notification, constitute an Authority to be Constitution
known as the (name of the Union territory) Authority for Advance Ruling: of Authority
for Advance
Provided that the Central Government may, on the recommendations of the Council, Ruling.
notify any Authority located in any State or any other Union territory to act as the Authority
for the purposes of this Act.
(2) The Authority shall consist of—
(i) one member from amongst the officers of central tax; and
(ii) one member from amongst the officers of Union territory tax,
to be appointed by the Central Government.
(3) The qualifications, the method of appointment of the members and the terms and
conditions of their service shall be such as may be prescribed.
16. (1) The Central Government shall, by notification, constitute an Appellate Authority Constitution
to be known as the (name of the Union territory) Appellate Authority for Advance Ruling of Appellate
for Goods and Services Tax for hearing appeals against the advance ruling pronounced by Authority for
Advance
the Advance Ruling Authority:
Ruling.
Provided that the Central Government may, on the recommendations of the Council,
notify any Appellate Authority located in any State or any other Union territory to act as the
Appellate Authority for the purposes of this Act.
(2) The Appellate Authority shall consist of—
(i) the Chief Commissioner of central tax as designated by the Board; and
(ii) the Commissioner of Union territory tax having jurisdiction over the
applicant.
CHAPTER VIII
TRANSITIONAL PROVISIONS
17. (1) On and from the appointed day, every person registered under any of the
Migration of
existing laws and having a valid Permanent Account Number shall be issued a certificate of existing tax
registration on provisional basis, subject to such conditions and in such form and manner payers.
as may be prescribed, which unless replaced by a final certificate of registration under
sub-section (2), shall be liable to be cancelled if the conditions so prescribed are not complied
with.
(2) The final certificate of registration shall be granted in such form and manner and
subject to such conditions as may be prescribed.
(3) The certificate of registration issued to a person under sub-section (1) shall be
deemed to have not been issued if the said registration is cancelled in pursuance of an
application filed by such person that he was not liable to registration under section 22 or
section 24 of the Central Goods and Services Tax Act.
18. (1) A registered person, other than a person opting to pay tax under section 10 of Transitional
the Central Goods and Services Tax Act, shall be entitled to take, in his electronic credit arrangements
for input tax
ledger, credit of the amount of Value Added Tax and Entry Tax, if any, carried forward in
credit.
the return relating to the period ending with the day immediately preceding the appointed
day, furnished by him under the existing law, not later than ninety days after the said day, in
such manner as may be prescribed:166 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Provided that the registered person shall not be allowed to take credit in the following
circumstances, namely:—
(i) where the said amount of credit is not admissible as input tax credit under
this Act; or
(ii) where he has not furnished all the returns required under the existing law
for the period of six months immediately preceding the appointed day; or
(iii) where the said amount of credit relates to goods sold under such exemption
notifications as are notified by the Government:
Provided further that so much of the said credit as is attributable to any claim related
to section 3, sub-section (3) of section 5, section 6 or section 6A or sub-section (8) of
section 8 of the Central Sales Tax Act, 1956 that is not substantiated in the manner, and 74 of 1956.
within the period, prescribed in rule 12 of the Central Sales Tax (Registration and Turnover)
Rules, 1957 shall not be eligible to be credited to the electronic credit ledger:
Provided also that an amount equivalent to the credit specified in the second proviso
shall be refunded under the existing law when the said claims are substantiated in the
manner prescribed in rule 12 of the Central Sales Tax (Registration and Turnover)
Rules, 1957.
(2) A registered person, other than a person opting to pay tax under section 10 of the
Central Goods and Services Tax Act, shall be entitled to take, in his electronic credit ledger,
credit of the unavailed input tax credit in respect of capital goods, not carried forward in a
return, furnished under the existing law by him, for the period ending with the day
immediately preceding the appointed day in such manner as may be prescribed:
Provided that the registered person shall not be allowed to take credit unless the said
credit was admissible as input tax credit under the existing law and is also admissible as
input tax credit under this Act.
Explanation.—For the purposes of this section, the expression ‘‘unavailed input tax
credit’’ means the amount that remains after subtracting the amount of input tax credit
already availed in respect of capital goods by the taxable person under the existing law from
the aggregate amount of input tax credit to which the said person was entitled in respect of
the said capital goods under the existing law.
(3) A registered person, who was not liable to be registered under the existing law or
who was engaged in the sale of exempted goods or tax free goods or goods which have
suffered tax at first point of their sale in the Union territory and the subsequent sales of
which are not subject to tax in the Union territory under the existing law but which are liable
to tax under this Act or where the person was entitled to the credit of input tax at the time of
sale of goods, shall be entitled to take, in his electronic credit ledger, credit of the value
added tax and entry tax, if any, in respect of inputs held in stock and inputs contained in
semi-finished or finished goods held in stock on the appointed day subject to the following
conditions, namely:—
(i) such inputs or goods are used or intended to be used for making taxable
supplies under this Act;
(ii) the said registered person is eligible for input tax credit on such inputs
under this Act;
(iii) the said registered person is in possession of invoice or other prescribed
documents evidencing payment of tax under the existing law in respect of such inputs; and
(iv) such invoices or other prescribed documents were issued not earlier than
twelve months immediately preceding the appointed day:
Provided that where a registered person, other than a manufacturer or a supplier
of services, is not in possession of an invoice or any other documents evidencingSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 167
payment of tax in respect of inputs, then, such registered person shall, subject to
such conditions, limitations and safeguards as may be prescribed, including that the
said taxable person shall pass on the benefit of such credit by way of reduced prices
to the recipient, be allowed to take credit at such rate and in such manner as may be
prescribed.
(4) A registered person, who was engaged in the sale of taxable goods as well as
exempted goods or tax free goods under the existing law but which are liable to tax under
this Act, shall be entitled to take, in his electronic credit ledger,—
(a) the amount of credit of the value added tax and entry tax, if any, carried
forward in a return furnished under the existing law by him in accordance with the
provisions of sub-section (1); and
(b) the amount of credit of the value added tax and entry tax, if any, in respect
of inputs held in stock and inputs contained in semi-finished or finished goods held
in stock on the appointed day, relating to such exempted goods or tax free goods in
accordance with the provisions of sub-section (3).
(5) A registered person shall be entitled to take, in his electronic credit ledger, credit
of value added tax and entry tax, if any, in respect of inputs received on or after the appointed
day but the tax in respect of which has been paid by the supplier under the existing law,
subject to the condition that the invoice or any other tax paying document of the same was
recorded in the books of account of such person within a period of thirty days from the
appointed day:
Provided that the period of thirty days may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding thirty days:
Provided further that the said registered person shall furnish a statement, in such
manner as may be prescribed, in respect of credit that has been taken under this sub-section.
(6) A registered person, who was either paying tax at a fixed rate or paying a fixed
amount in lieu of the tax payable under the existing law shall be entitled to take, in his
electronic credit ledger, credit of value added tax in respect of inputs held in stock and
inputs contained in semi-finished or finished goods held in stock on the appointed day
subject to the following conditions, namely:—
(i) such inputs or goods are used or intended to be used for making taxable
supplies under this Act;
(ii) the said registered person is not paying tax under section 10 of the Central
Goods and Services Tax Act;
(iii) the said registered person is eligible for input tax credit on such inputs
under this Act;
(iv) the said registered person is in possession of invoice or other prescribed
documents evidencing payment of tax under the existing law in respect of inputs; and
(v) such invoices or other prescribed documents were issued not earlier than
twelve months immediately preceding the appointed day.
(7) The amount of credit under sub-sections (3), (4) and (6) shall be calculated in
such manner as may be prescribed.
19. (1) Where any inputs received at a place of business had been desptached as such Transitional
or desptached after being partially processed to a job worker for further processing, testing, provisions
repair, reconditioning or any other purpose in accordance with the provisions of existing relating to job
work.
law prior to the appointed day and such inputs are returned to the said place on or after the
appointed day, no tax shall be payable if such inputs, after completion of the job work or
otherwise, are returned to the said place within six months from the appointed day:168 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Provided that the period of six months may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding two months:
Provided further that if such inputs are not returned within a period of six months or
the extended period from the appointed day, the input tax credit shall be liable to be recovered
in accordance with the provisions of clause (a) of sub-section (8) of section 142 of the
Central Goods and Services Tax Act.
(2) Where any semi-finished goods had been despatched from any place of business
to any other premises for carrying out certain manufacturing processes in accordance with
the provisions of existing law prior to the appointed day and such goods (hereinafter in this
section referred to as ‘‘the said goods’’) are returned to the said place on or after the appointed
day, no tax shall be payable if the said goods, after undergoing manufacturing processes or
otherwise, are returned to the said place within six months from the appointed day:
Provided that the period of six months may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding two months:
Provided further that if the said goods are not returned within a period specified in
this sub-section, the input tax credit shall be liable to be recovered in accordance with the
provisions of clause (a) of sub-section (8) of section 142 of the Central Goods and Services
Tax Act:
Provided also that the person despatching the goods may, in accordance with the
provisions of the existing law, transfer the said goods to the premises of any registered
person for the purpose of supplying therefrom on payment of tax in India or without payment
of tax for exports within six months or the extended period, as the case may be, from the
appointed day.
(3) Where any goods had been despatched from the place of business without payment
of tax for carrying out tests or any other process to any other premises, whether registered
or not, in accordance with the provisions of existing law prior to the appointed day and
such goods are returned to the said place of business on or after the appointed day, no tax
shall be payable if the said goods, after undergoing tests or any other process, are returned
to such place within six months from the appointed day:
Provided that the period of six months may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding two months:
Provided further that if the said goods are not returned within the period specified in
this sub-section, the input tax credit shall be liable to be recovered in accordance with the
provisions of clause (a) of sub-section (8) of section 142 of the Central Goods and Services
Tax Act:
Provided also that the person despatching the goods may, in accordance with the
provisions of the existing law, transfer the said goods from the said other premises on
payment of tax in India or without payment of tax for exports within six months or the
extended period, as the case may be, from the appointed day.
(4) The tax under sub-sections (1), (2) and (3) shall not be payable only if the person
despatching the goods and the job worker declare the details of the inputs or goods held in
stock by the job worker on behalf of the said person on the appointed day in such form and
manner and within such time as may be prescribed.
Miscellaneous 20. (1) Where any goods on which tax, if any, had been paid under the existing law at
transitional
the time of sale thereof, not being earlier than six months prior to the appointed day, are
provisions.
returned to any place of business on or after the appointed day, the registered person shall
be eligible for refund of the tax paid under the existing law where such goods are returnedSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 169
by a person, other than a registered person, to the said place of business within a period of
six months from the appointed day and such goods are identifiable to the satisfaction of the
proper officer:
Provided that if the said goods are returned by a registered person, the return of such
goods shall be deemed to be a supply.
(2) (a) Where, in pursuance of a contract entered into prior to the appointed day, the
price of any goods is revised upwards on or after the appointed day, the registered person
who had sold such goods shall issue to the recipient a supplementary invoice or debit note,
containing such particulars as may be prescribed, within thirty days of such price revision
and for the purposes of this Act, such supplementary invoice or debit note shall be deemed
to have been issued in respect of an outward supply made under this Act.
(b) Where, in pursuance of a contract entered into prior to the appointed day, the
price of any goods is revised downwards on or after the appointed day, the registered person
who had sold such goods may issue to the recipient a credit note, containing such particulars
as may be prescribed, within thirty days of such price revision and for the purposes of this
Act such credit note shall be deemed to have been issued in respect of an outward supply
made under this Act:
Provided that the registered person shall be allowed to reduce his tax liability on
account of issue of the credit note only if the recipient of the credit note has reduced his
input tax credit corresponding to such reduction of tax liability.
(3) Every claim for refund filed by any person before, on or after the appointed day,
for refund of any amount of input tax credit, tax, interest or any other amount paid under
the existing law, shall be disposed of in accordance with the provisions of existing law and
any amount eventually accruing to him shall be refunded to him in cash in accordance with
the provisions of the said law:
Provided that where any claim for refund of the amount of input tax credit is fully or
partially rejected, the amount so rejected shall lapse:
Provided further that no refund shall be allowed of any amount of input tax credit
where the balance of the said amount as on the appointed day has been carried forward
under this Act.
(4) Every claim for refund filed after the appointed day for refund of any tax paid
under the existing law in respect of the goods exported before or after the appointed day
shall be disposed of in accordance with the provisions of the existing law:
Provided that where any for refund of input tax credit is fully or partially rejected, the
amount so rejected shall lapse:
Provided further that no refund shall be allowed of any amount of input tax credit
where the balance of the said amount as on the appointed day has been carried forward
under this Act.
(5) (a) Every proceeding of appeal, revision, review or reference relating to a claim
for input tax credit initiated whether before, on or after the appointed day, under the existing
law shall be disposed of in accordance with the provisions of the existing law, and any
amount of credit found to be admissible to the claimant shall be refunded to him in cash in
accordance with the provisions of the existing law and the amount rejected, if any, shall not
be admissible as input tax credit under this Act:
Provided that no refund shall be allowed of any amount of input tax credit where the
balance of the said amount as on the appointed day has been carried forward under this Act.
(b) Every proceeding of appeal, revision, review or reference relating to recovery of
input tax credit initiated whether before, on or after the appointed day, under the existing
law shall be disposed of in accordance with the provisions of the existing law, and if any170 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
amount of credit becomes recoverable as a result of such appeal, revision, review or reference,
the same shall, unless recovered under the existing law, be recovered as an arrear of tax
under this Act and the amount so recovered shall not be admissible as input tax credit under
this Act.
(6) (a) Every proceeding of appeal, revision, review or reference relating to any output
tax liability initiated whether before, on or after the appointed day under the existing law,
shall be disposed of in accordance with the provisions of the existing law, and if any amount
becomes recoverable as a result of such appeal, revision, review or reference, the same
shall, unless recovered under the existing law, be recovered as an arrear of tax under this Act
and amount so recovered shall not be admissible as input tax credit under this Act.
(b) Every proceeding of appeal, revision, review or reference relating to any output
tax liability initiated whether before, on or after the appointed day under the existing law,
shall be disposed of in accordance with the provisions of the existing law, and any amount
found to be admissible to the claimant shall be refunded to him in cash in accordance with
the provisions of the existing law and the amount rejected, if any, shall not be admissible as
input tax credit under this Act.
(7) (a) Where in pursuance of an assessment or adjudication proceedings instituted,
whether before, on or after the appointed day, under the existing law, any amount of tax,
interest, fine or penalty becomes recoverable from the person, the same shall, unless
recovered under the existing law, be recovered as an arrear of tax under this Act and the
amount so recovered shall not be admissible as input tax credit under this Act.
(b) Where in pursuance of an assessment or adjudication proceedings instituted,
whether before, on or after the appointed day under the existing law, any amount of tax,
interest, fine or penalty becomes refundable to the taxable person, the same shall be refunded
to him in cash under the said law and the amount rejected, if any, shall not be admissible as
input tax credit under this Act.
(8) (a) Where any return, furnished under the existing law, is revised after the appointed
day and if, pursuant to such revision, any amount is found to be recoverable or any amount
of input tax credit is found to be inadmissible, the same shall, unless recovered under the
existing law, be recovered as an arrear of tax under this Act and the amount so recovered
shall not be admissible as input tax credit under this Act.
(b) Where any return, furnished under the existing law, is revised after the appointed
day but within the time limit specified for such revision under the existing law and if,
pursuant to such revision, any amount is found to be refundable or input tax credit is found
to be admissible to any taxable person, the same shall be refunded to him in cash under the
existing law and the amount rejected, if any, shall not be admissible as input tax credit
under this Act.
(9) Save as otherwise provided in this Chapter, the goods or services or both supplied
on or after the appointed day in pursuance of a contract entered into prior to the appointed
day shall be liable to tax under the provisions of this Act.
(10) (a) Notwithstanding anything contained in section 12 of the Central Goods and
Services Tax Act, no tax shall be payable on goods under this Act to the extent the tax was
leviable on the said goods under the existing law.
(b) Notwithstanding anything contained in section 13 of the Central Goods and Services
Tax Act, no tax shall be payable on services under this Act to the extent the tax was leviable
on the said services under Chapter V of the Finance Act, 1994. 32 of 1994.
(c) Where tax was paid on any supply, both under any existing law relating to sale of
goods and under Chapter V of the Finance Act, 1994, tax shall be leviable under this Act 32 of 1994.
and the taxable person shall be entitled to take credit of value added tax or service tax paid
under the existing law to the extent of supplies made after the appointed day and such
credit shall be calculated in such manner as may be prescribed.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 171
(11) Where any goods sent on approval basis, not earlier than six months before the
appointed day, are rejected or not approved by the buyer and returned to the seller on or
after the appointed day, no tax shall be payable thereon if such goods are returned within
six months from the appointed day:
Provided that the said period of six months may, on sufficient cause being shown, be
extended by the Commissioner for a further period not exceeding two months:
Provided further that the tax shall be payable by the person returning the goods if
such goods are liable to tax under this Act and are returned after the period specified in this
sub-section:
Provided also that tax shall be payable by the person who has sent the goods on
approval basis if such goods are liable to tax under this Act, and are not returned within the
period specified in this sub-section.
(12) Where a supplier has made any sale of goods in respect of which tax was required
to be deducted at source under any existing law relating to sale of goods and has also issued
an invoice for the same before the appointed day, no deduction of tax at source under
section 51 of the Central Goods and Services Tax Act, as made applicable to this Act, shall
be made by the deductor under the said section where payment to the said supplier is made
on or after the appointed day.
Explanation.—For the purposes of this Chapter, the expression ‘‘capital goods’’ shall
have the same meaning as assigned to it in any existing law relating to sale of goods.
CHAPTER IX
MISCELLANEOUS
21. Subject to the provisions of this Act and the rules made thereunder, the provisions Application of
of the Central Goods and Services Tax Act, relating to,— provisions of
Central Goods
(i) scope of supply; and Services
Tax Act.
(ii) composition levy;
(iii) composite supply and mixed supply;
(iv) time and value of supply;
(v) input tax credit;
(vi) registration;
(vii) tax invoice, credit and debit notes;
(viii) accounts and records;
(ix) returns;
(x) payment of tax;
(xi) tax deduction at source;
(xii) collection of tax at source;
(xiii) assessment;
(xiv) refunds;
(xv) audit;
(xvi) inspection, search, seizure and arrest;
(xvii) demands and recovery;
(xviii) liability to pay in certain cases;172 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(xix) advance ruling;
(xx) appeals and revision;
(xxi) presumption as to documents;
(xxii) offences and penalties;
(xxiii) job work;
(xxiv) electronic commerce;
(xxv) settlement of funds;
(xxvi) transitional provisions; and
(xxvii) miscellaneous provisions including the provisions relating to the
imposition of interest and penalty,
shall, mutatis mutandis, apply,—
(a) so far as may be, in relation to Union territory tax as they apply in relation to
central tax as if they were enacted under this Act;
(b) subject to the following modifications and alterations which the Central
Government considers necessary and desirable to adapt those provisions to the
circumstances, namely:—
(i) references to ‘‘this Act’’ shall be deemed to be references to ‘‘the
Union Territory Goods and Services Tax Act, 2017’’;
(ii) references to ‘‘Commissioner’’ shall be deemed to be references to
‘‘Commissioner’’ of Union territory tax as defined in clause (2) of section 2 of
this Act;
(iii) references to ‘‘officers of central tax’’ shall be deemed to be references
to ‘‘officers of Union territory tax’’;
(iv) references to ‘‘central tax’’ shall be deemed to be references to ‘‘Union
territory tax’’ and vice versa;
(v) references to ‘‘Commissioner of State tax or Commissioner of Union
territory tax’’ shall be deemed to be references to ‘‘Commissioner of central tax’’;
(vi) references to ‘‘State Goods and Services Tax Act or Union Territory
Goods and Services Tax Act’’ shall be deemed to be references to ‘‘Central
Goods and Services Tax Act’’;
(vii) references to ‘‘State tax or Union territory tax’’ shall be deemed to be
references to ‘‘central tax’’.
22. (1) The Central Government may, on the recommendations of the Council, by
Power to
make rules. notification, make rules for carrying out the provisions of this Act.
(2) Without prejudice to the generality of the provisions of sub-section (1), the
Central Government may make rules for all or any of the matters which by this Act are
required to be, or may be, prescribed or in respect of which provisions are to be or may be
made by rules.
(3) The power to make rules conferred by this section shall include the power to give
retrospective effect to the rules or any of them from a date not earlier than the date on which
the provisions of this Act come into force.
(4) Any rules made under sub-section (1) may provide that a contravention thereof
shall be liable to a penalty not exceeding ten thousand rupees.
General 23. The Board may, by notification, make regulations consistent with this Act and the
power to rules made thereunder to carry out the purposes of this Act.
make
regulations.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 173
24. Every rule made by the Central Government, every regulation made by the Board Laying of
and every notification issued by the Central Government under this Act, shall be laid, as rules,
regulations
soon as may be, after it is made or issued, before each House of Parliament, while it is in
and
session, for a total period of thirty days which may be comprised in one session or in two or
notifications.
more successive sessions, and if, before the expiry of the session immediately following
the session or the successive sessions aforesaid, both Houses agree in making any
modification in the rule or regulation or in the notification, as the case may be, or both
Houses agree that the rule or regulation or the notification should not be made, the rule or
regulation or notification, as the case may be, shall thereafter have effect only in such
modified form or be of no effect, as the case may be; so, however, that any such modification
or annulment shall be without prejudice to the validity of anything previously done under
that rule or regulation or notification, as the case may be.
25. The Commissioner may, if he considers it necessary or expedient so to do for the
Power to issue
purpose of uniformity in the implementation of this Act, issue such orders, instructions or instructions or
directions to the Union territory tax officers as he may deem fit, and thereupon all such directions
officers and all other persons employed in the implementation of this Act shall observe and
follow such orders, instructions or directions.
26. (1) If any difficulty arises in giving effect to any provision of this Act, the Central Removal of
Government may, on the recommendations of the Council, by a general or a special order difficulties.
published in the Official Gazette, make such provisions not inconsistent with the provisions
of this Act or the rules or regulations made thereunder, as may be necessary or expedient
for the purpose of removing the said difficulty:
Provided that no such order shall be made after the expiry of a period of three years
from the date of commencement of this Act.
(2) Every order made under this section shall be laid, as soon as may be, after it is
made, before each House of Parliament.174 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
STATEMENT OF OBJECTS AND REASONS
Presently, the Constitution empowers the Central Government to levy excise duty
on manufacturing and service tax on the supply of services. Similarly, it empowers the
State Governments and Union territories to levy sales tax or value added tax on the
sale of goods. In addition, many States also levy an entry tax on the entry of goods in
local areas. This exclusive division of fiscal powers has led to a multiplicity of indirect
taxes in the country.
2. The present tax system on goods and services in the Union territories is facing
certain difficulties which are as under—
(a) the multiplicity of taxes at the Central and State levels has resulted in a
complex indirect tax structure in the country that is ridden with hidden costs for
the trade and industry;
(b) there is no uniformity of tax rates and structure across the States and
there is cascading of taxes due to "tax on tax"; and
(c) the credit of excise duty and service tax paid at the stage of manufacture
is not available to the traders while paying the State level sales tax or value added
tax, and vice versa. Further, the credit of State taxes paid in one State cannot be
availed in other States. Hence, the prices of goods and services get artificially
inflated to the extent of this "tax on tax".
3. In view of the above, it has become necessary to have a Central Legislation,
namely, the Union Territory Goods and Services Tax Bill, 2017. The proposed
Legislation will confer power upon the Central Government for levying goods and
services tax on the supply of goods or services or both which takes place within a
Union territory without Legislature.
4. The proposed Legislation will simplify and harmonise the indirect tax regime
in the country. It is expected to reduce the cost of production and inflation in the
economy, thereby making the Indian trade and industry more competitive, domestically
as well as internationally. It is also expected that introduction of goods and services
tax will foster a common or seamless Indian market and contribute significantly to the
growth of the economy. Due to the seamless transfer of input tax credit from one stage
to another in the chain of value addition, there is an in-built mechanism in the design of
goods and services tax that would incentivise tax compliance by tax payers. The
proposed goods and services tax will broaden the tax base and result in better tax
compliance due to a robust information technology infrastructure.
5. The Union Territory Goods and Services Tax Bill, 2017, inter alia, provides for
the following, namely:—
(a) to levy tax on all intra-State supplies of goods or services or both except
supply of alcoholic liquor for human consumption at a rate to be notified, not
exceeding twenty per cent. as recommended by the Goods and Services Tax
Council (the Council);
(b) to empower the Central Government to grant exemptions, by notification
or by special order, on the recommendations of the Council;
(c) to provide for apportionment of tax and settlement of funds on account
of transfer of input tax credit between the Central Government, State Government
and Union territory;
(d) to provide for assistance by officers of Police, Railways, Customs, and
those engaged in the collection of land revenue, including village officers, andSEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 175
officers of central tax and officers of the State tax to proper officers in the
implementation of the proposed Legislation;
(e) to provide for recovery of tax, interest or penalty payable by a person to
the Government which remains unpaid, by the proper officer of central tax;
(f) to establish an Authority for Advance Ruling in order to enable the
taxpayer to seek a binding clarity on taxation matters from the department;
(g) to provide for elaborate transitional provisions for smooth transition of
existing taxpayers to goods and services tax regime;
(h) to provide for application of certain provisions of the Central Goods
and Services Tax Act, 2017, inter alia, relating to definitions, time and value of
supply, input tax credit, registration, returns other than late fee, payment of tax,
assessment, refunds, audit, inspection, search, seizure and arrest, demands and
recovery, appeals and revision, offences and penalties and transitional provisions
in the proposed Legislation; and
(i) to empower the Commissioner to issue orders, instructions or directions
to the Union territory tax officers.
6. The Notes on clauses explain in detail the various provisions contained in the
Union Territory Goods and Services Tax Bill, 2017.
7. The Bill seeks to achieve the above objectives.
NEW DELHI; ARUN JAITLEY.
The 23rd March, 2017.176 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
Notes on clauses
Clause 1 provides for short title, extent and commencement of the proposed Act.
Clause 2 defines various terms and expressions used in the proposed Act.
Clause 3 provides for appointment of Commissioners and other class of officers
as may be required for carrying out the purposes of the proposed Act.
Clause 4 confers power on the Administrator to appoint officers of Union territory
tax below the rank of Assistant Commissioner of Union territory tax for the
administration of the proposed Act.
Clause 5 provides for conditions and exceptions for exercising the powers by the
Union territory tax officers.
Clause 6 provides for authorisation of Central tax officers, subject to certain
conditions as shall be notified by the Central Government on recommendations of the
Council, to be proper officers for the purposes of the proposed Act.
Clause 7 provides for levy of Union territory tax on all intra-State supplies of
goods or services or both except on the supply of alcoholic liquor for human
consumption, on the value determined under section 15 of the Central Goods and
Services Tax Act at such rates not exceeding forty per cent. This clause further provides
that—
(i) Union territory tax on the supply of petroleum crude, high speed diesel,
motor spirit (commonly known as petrol), natural gas and aviation turbine fuel to
be levied with effect from a date notified by the Central Government on the
recommendations of the Council;
(ii) the Central Government to notify categories of supply of goods or
services or both, the tax on which shall be paid on reverse charge basis by the
recipient of such goods or services or both, on the recommendations of the
Council;
(iii) the Union territory tax in respect of the supply of taxable goods or
services or both by a supplier, who is not registered, to a registered person shall
be paid by such person on reverse charge basis;
(iv) the Central Government may notify categories of services, the tax on
intra-State supplies of which shall be paid by the electronic commerce operator
if such services are supplied through it, on the recommendations of the Council.
Clause 8 confers powers on the Central Government to exempt either absolutely
or conditionally goods or services or both of any specified description from the whole
or any part of the Union territory tax, on the recommendations of the Council. It also
confers powers on the Central Government to exempt from payment of tax any goods
or services or both, by special order, on which tax is leviable on the recommendations
of the Council.
Clause 9 provides for the manner and order in which input tax credit of integrated
tax and input tax credit of Union territory tax is to be utilised.
Clause 10 provides for transfer of credit of Union territory tax to the integrated
tax account when Union territory tax credit has been used for payment of central tax.
Clause 11 provides for officers of Police, Railways, Customs and other officers
engaged in collection of land revenue to assist officers involved in implementation of
this Act.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 177
Clause 12 provides for refund of Union territory tax in situations where
intra-State supplies are subsequently held to be inter-State supplies.
Clause 13 provides for recovery of Union territory tax, interest or penalty by
Central tax officer while recovering arrears of Central tax.
Clause 14 defines terms and expressions such as advance ruling, applicant,
application, etc., used in Chapter VII.
Clause 15 provides for constitution of Advance Ruling by the Central Government.
Clause 16 provides for constitution of Appellate Authority for Advance Ruling
by the Central Government.
Clause 17 provides for migration of taxpayers registered under the existing law
to be issued provisional registration under the proposed Act, if the said taxpayer is
required to be registered under the provisions of the proposed Act.
Clause 18 provides for transitional arrangements for carrying forward of input
tax credit available under the existing law.
Clause 19 provides for transitional provisions relating to job work.
Clause 20 provides for miscellaneous provisions for transition of existing tax
payers in various situations.
Clause 21 provides for application of specific provisions of the Central Goods
and Services Tax Act to the proposed Act.
Clause 22 confers powers on the Central Government to make rules for carrying
out the provisions of the proposed Act on recommendations of the Council.
Clause 23 confers powers on the Board to make regulations for carrying out the
provisions of the proposed Act.
Clause 24 provides for laying of rules, regulations and notifications made by the
Central Government before each House of the Parliament.
Clause 25 confers powers to the Commissioner to issue orders, instructions or
directions to the Union territory tax officers for uniform implementation of the provisions
of the proposed Act.
Clause 26 confers powers on the Central Government to make such provisions
not inconsistent with the provisions of the proposed Act or the rules or regulations by
a general or special order, on the recommendations of the Council within a period of
three years from the date of commencement of the proposed Act.178 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
FINANCIAL MEMORANDUM
Clause 10 of the Bill provides for apportionment of tax and settlement of funds on
account of transfer of utilisation of input tax credit under this Bill for the payment of tax
dues under the integrated goods and services tax by the Central Government.
2. Sub-clause (1) of clause 15 of the Bill provides for the establishment of an
Authority for Advance Ruling.
3. Sub-clause (1) of clause 16 of the Bill provides for the establishment of an
Appellate Authority for Advance Ruling.
4. Sub-clause (1) of clause 21 of the Bill provides for application of provisions of
the Central Goods and Services Tax Bill, 2017 relating to appeals, advance ruling and
anti-profiteering. So authorities established under Central Goods and Services Tax Act
will be utilised for the purposes of this Bill. Thus there will be no extra financial
expenditure under this Bill.
5. The total financial implications in terms of recurring and non-recurring expendi-
ture involved in carrying out the various functions under the Bill would be borne by the
Central Government. Most of the existing officers and staff of the Central Board of
Excise and Customs and Union territories would be used for carrying out the various
functions under the Bill. However, it is not possible to estimate the exact recurring and
non-recurring expenditure from the Consolidated Fund of India at this stage.SEC. 2] THE GAZETTE OF INDIA EXTRAORDINARY 179
MEMORANDUM REGARDING DELEGATED LEGISLATION
Clause 22 of the UnionTerritory Goods and Services Tax Bill, 2017 seeks to empower
the Government to make rules, inter alia, in the following—
(a) collection of taxes under section 7; (b) manner and time in which input tax
credit will be transferred under section 10; (c) manner in which tax wrongfully collected
and paid to Central Government or Union territory Government is to be refunded
under section 19; (d) qualifications, the method of appointment of the members and
the terms and conditions of their service for Authority of Advance Ruling under-
section 15; (e) form and manner in which certification of registration on provisional
basis is to be issued under section 17; (f) manner in which input tax credit is to be
carried forward under section 18; (g) form, manner and time in which the job worker
declares inputs held in stock on behalf of the manufacturer under section 19;
(h) manner in which credit will be calculated on tax paid under existing law under
section 20; and (i) any other matter which is to be, or may be, prescribed, or in respect
of which provision is to be made, by rules.
2. Clause 23 of the Bill empowers the Board to make regulations to provide for any
matter which is required to be, or may be, specified by regulation or in respect of which
provision is to be made by regulations.
3. The matters in respect of which the said rules and regulations may be made are
matters of procedure and administrative detail, and as such, it is not practicable to provide
for them in the proposed Bill itself. The delegation of legislative power is, therefore, of a
normal character.
——————
ANOOP MISHRA
Secretary General
UPLOADED BY THE GENERAL MANAGER, GOVERNMENT OF INDIA PRESS, MINTO ROAD, NEW DELHI–110 002
AND PUBLISHED BY THE CONTROLLER OF PUBLICATIONS, DELHI–110 054.
GMGIPMRND—5576GI(S3)—20-04-2017.