Executive Summary:
This document is the Delhi Value Added Tax (Amendment) Act, 2015, which amends the Delhi Value Added Tax Act, 2004. It received assent from the Lieutenant Governor of Delhi on July 10, 2015, and was published for general information on July 14, 2015. The Act introduces changes to tax rates, credit notes, debit notes, and penalties.
Key Points / Main Content:
Tax Rates:
* For goods specified in the Fourth Schedule, the tax rate will be as specified therein.
* The tax rate for goods in the Fourth Schedule shall be higher than under clause e of subsection 1 of section 4 but shall not exceed thirty paise in the rupee.
Credit and Debit Notes:
* Adjustments to previously agreed sale considerations are allowed if altered by agreement, except for discounts or incentives offered via credit notes after tax invoice issuance to registered dealers.
* Credit notes for post-sale discounts or incentives are independent of the tax component, requiring no output tax adjustments.
* Purchasers issued credit or debit notes under Section 51, or those returning/rejecting goods, must adjust tax credit amounts in the tax period when the note was issued or goods were returned.
* No input tax credit reduction is needed for buying dealers receiving credit notes for post-sale discounts/incentives if no output tax adjustment was made.
Other Amendments:
* Section 22, subsection 7 has been omitted.
* The time frame in section 38, subsection 5 has been changed from fifteen to forty-five days.
* The starting word of section 51 has been amended to include a reference to subsections 1 and 2 of section 8.
Penalties:
* The penalty in section 86, subsection 5 has been changed from five hundred to two hundred.
* A penalty of two hundred rupees per day, up to a maximum of twenty-five thousand rupees, will be imposed on registered dealers failing to comply with Section 22(2).
* The penalty in section 86, subsection 9 has been changed from five hundred to two hundred.
* Section 86, subsection 16 has been amended to add clauses relating to failure to correctly account for issued invoices, or failure to issue invoices as required under Section 50.
* The explanation in section 86, subsection 20 has been omitted.
Omissions:
* Section 89, subsection 4, clause c has been omitted.
Fourth Schedule:
* The Fourth Schedule has been replaced with a new list of commodities and their tax rates, including petroleum products, liquor, narcotics, molasses, lottery tickets, brake fluid, tobacco, aerated drinks, and watches costing above rupees five thousand, all taxed at twenty paise in the rupee.
Impact Analysis:
Registered Dealers:
* Impact: Changes to tax rates on specific goods, adjustments to credit/debit note handling, potential penalties for non-compliance, and changes to the time frame in section 38, subsection 5.
* Action Required: Adjust accounting practices to reflect changes in tax rates and credit/debit note procedures, ensure compliance with invoice requirements and timelines, and be aware of updated penalty amounts.
Purchasers:
* Impact: Changes to tax credit claims related to returned goods or credit/debit notes.
* Action Required: Adjust tax credit claims based on credit/debit notes received or goods returned, following the guidelines provided in the amended sections.
Government of Delhi (Tax Authorities):
* Impact: Revised procedures for tax collection, enforcement, and penalty imposition.
* Action Required: Update systems and procedures to reflect the amended regulations, communicate changes to relevant stakeholders, and enforce compliance with the new provisions.
Key Entities Referenced
National Capital Territory of Delhi: The administrative territory governed by the Government of the National Capital Territory of Delhi.
Delhi Value Added Tax Act, 2004: The principal act being amended by the Delhi Value Added Tax (Amendment) Act, 2015.
Delhi Value Added Tax (Amendment) Act, 2015: An act to amend the Delhi Value Added Tax Act, 2004.
Legislative Assembly of the National Capital Territory of Delhi: The legislative body that passed the Delhi Value Added Tax (Amendment) Act, 2015.
Fourth Schedule: A schedule within the Delhi Value Added Tax Act, 2004, specifying commodities and their tax rates.
Government of India Press, Ring Road, Mayapuri, New Delhi: The printing press responsible for printing the gazette notification.
Section 51: A section in the principal Act related to credit and debit notes
Vikrant Vaid: Addl. Secy. Law, Justice L.A.
Trq(cid:9) .-33002/99 laird t0441 REGISTERED No. D.L.-33002/99
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MISPIEFItATION
Delhi, the 14th ittly,1015
No. F. 1
4(6)/LA.2015/ cons2bw/ 117-126.—The fallowing Act oft Legisbtive AssensMyof be National
Capital Taritory-of Delhi received the assent of the it Gurrensur of Dab ott the 10
perbliabed far general iskawantiab- 11 July, 2015 end is hereby
'TM DEWY VALUE ADDED TA.Ead AMENOMENT)ACT,IMISI
(DELHI ACT 05 DE 2015)
(As passed by the Legislative Assembly of the National Capital Territory of Delhi on the 30th June, 2015)
flOth July, 20151
An Act toll:tither amend the Delhi Value Added Tax Act, 2004 (3 of 2005).
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.-J3E itessnetbsl"intinesbisemblrefate National
abraepubric(cid:9) ontalia ES(cid:9) fORMOS: — (cid:9)Capital Territory rif Delhi athe(cid:9) Graf
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AtnchnSeinbob tallei,EMegatoutinurentrt(i)EhiS ActbnyberainfiedaltnedbilialweAdded Tax
tit, 2015. Diewad
(ii)
It extentittothe whble of the National Capital Territory of Delhi.
(iii)
It shall come into force on such date as the GOverrunent may, by notification in beefficial
appoint:
Gazete,
"'Provided that different dates may be appointed for different provisions of this Act.
2.(cid:9)
"Amendment of section 4.—In the principal Act, in siection4, in sub-section (1), for -babe (c),.
clauseshall be substituted, namely: — the following
"(c) in respect of goods specified in the Fourth Schedule, at the rates specified therein against the
description of goods :(cid:9)
DELHI GAZETTE: EXTRAORDINARY [PART IV
Provided that the rate of tax in respect of goods specified in the Fourth Schedule shall be
higher than the rate of tax applicable under clause (e) of this sub-section but shall not be more than
thirty paise in the rupee;".
3.(cid:9) Amendment of section 8.—In the principal Act, in section 8, —
(i) in sub-section (1), for clause (c), the following clause shall be substituted, namely: —
"(c) the previously agreed consideration for that sale has been altered by agreement with the recipient
for any reason except where a discount or incentive is offered through a credit note after issuance of
tax invoice in respect of a sale to a registered dealer;"; and
(ii) in sub-section (2), after clause (b), the following explanation shall be inserted, namely: —
"Explanation : Credit notes issued on account of post sale discounts or incentives will be independent
of tax component and no adjustments in the output tax would be required to be made.".
4.(cid:9) Amendment of Section 10.—In the principal Act, in section 10,-
(i) for sub-section (1), the following sub-section shall be substituted, namely: —
"(1) Subject to sub-sections (1) and (2) of section 8, where any purchaser has been issued with a credit note
or debit note in terms of section 51 of this Act or if he returns or rejects goods purchased, as a consequence of
which the tax credit claimed by him in any tax period in respect of which the purchase of goods relates,
becomes short or excess, he shall compensate such short or excess by adjusting the amount of the tax credit
allowed to him in respect of the tax period in which the credit note or debit note has been issued or goods are
returned.
Explanation : While issuance of a credit note of a post sale discount or incentive by a selling dealer,
where no adjustment to output tax, as per the provisions of sub-sectioni (1) and (2) of section 8 has been
made, no adjustment for reduction of input tax credit would be required by the respective buying
registered dealer."; and
(ii) in sub-section (5), for the starting word "Where", the words and symbol "Subject to sub-sections (1) and (2)
of section 8 and conditions as may be prescribed, where" shall be substituted.
5.(cid:9) Amendment of section 22.—hi the principal Act, in section 22, sub-section (7) shall be omitted.
6.(cid:9)
Amendment of section 38.—In the principal Act, in section 38, in sub-section (5), for the words "fifteen
days", the words "forty five days" shall be substituted.
7.(cid:9) Amendment of section 51.—In the principal Act, in section 51, for the starting word "Where", the words
and symbol "Subject to sub-sections (1) and (2) of section 8, where" shall be substituted.
8.(cid:9) Amendment of section 86.—In the principal Act, in section 86-
(i) in sub-section (5), for the words "five hundred", the words "two hundred" shall be substituted;
(ii) for sub-section (6), the following sub-section shall be substituted, namely: —
"(6) If a registered dealer fails to comply with the provisions of sub-section (2) of Section 22 of this Act,
he shall be liable to pay, by way of penalty, a sum equal to two hundred rupees for every day of default
subject to a maximum of twenty five thousand rupees.";
(iii) in sub-section (9), for the words "five hundred", the words "two hundred" shall be substituted;
(iv) in sub-section (16), for clause (b), the following clauses shall be substituted, namely: —
"(b) having issued a tax invoice or retail invoice, has failed to account it correctly in his books of
account; or
(c) failed to issue a tax invoice or retail invoice as required under the provisions of section 50 of this
Act;" and
(v) in sub-section (20), the explanation shall be omitted.
9.(cid:9) Amendment of section 89.—In the principal Act, in section 89, in sub-section' (4), clause (c) shall be
omitted.
10.(cid:9) Amendment of the Fourth Schedule.—In the principal Act, for the Fourth Schedule appended thereto, the
following shall be substituted, namely:—(cid:9) (cid:9)
PART IV] DELHI GAZETTE : EXTRAORDINARY 5
"The Fourth Schedule
(see section 4)
S.No. Commodity Rate of Tax
1. 'Petroleum Products other than liquid petroleum gas, piped natural gas, Twenty paise in the
Compressed Natural Gas and Kerosene such as rupee
(0(cid:9) Naptha;
(ii) Aviation Turbine Fuel;
(iii) Spirit;
(iv) Gasoline;
(v) Furnace oil;
(vi) Wax (except petroleum wax used for manufacture of candles);
(vii) Mixture and combination of above products.
2. Liquor (Foreign and Indian Made Foreign Liquor). Twenty paise in the
rupee
3. Country Liquor. Twenty paise in the
rupee
4. Narcotics (Bhaang). Twenty paise in the
rupee
5. Molasses. Twenty paise in the
rupee
6. Rectified Spirit. Twenty paise in the
rupee
7. Lottery Tickets. Twenty paise in the
rupee
8. Brake Fluid. Twenty paise in the
rupee
9. Tobacco and Gutkha, unmanufactured tobacco, bidis and tobacco used in Twenty paise in the
manufacture of bidis and hooka tobacco rupee
10. Aerated Drinks. Twenty paise in the
rupee
11. Watches costing above rupees five thousand. Twenty paise in the
rupee"
VIKRANT VAID, Addl. Secy. (Law, Justice & L.A.)
?) 4 )-(cid:9) IC— 7--
Printed by the Manager, Government of India Press, Ring Road, Mayapuri, New Delhi-110064
and Published by the Controller of Publications, Delhi-110054.