Note on Entry Tax under Punjab Value Added Tax Act, 2005

Note on Entry Tax under Punjab Value Added Tax Act, 2005

Authored by…J S BEDI Advocate

Email ID: bediadvocate@yahoo.co.in

Contact Number: 98140-66336

Applicability

Entry tax is leviable on all persons including taxable person registered under the Punjab Value Added Tax Act, 2005 on entry of goods into the state of Punjab for the notified goods of which the list alongwith rates of entry tax is mentioned below in table. Here it is pertinent to point out that entry tax is payable on the goods even imported from outside the territory of India. Entry tax is not leviable if the goods are not notified for levy of entry tax U/s 3 or 3A or goods though notified but are coming in the state of Punjab for Job Work, Rejected Material and Returned Material subject to certain conditions or goods are not meant for state of Punjab but are in transit for destination outside the state of Punjab.

Mode of Payment

             In case entry by Road the importer has to pay the entry tax at the Information Collection Centre and for other imports in Punjab by Rail/Air the entry tax has to be deposited in the office of concerned Asst. Excise & Taxation Commissioner incharge of the district within 2 days of such import and in case where goods are coming through Rails and ICC is situated at Railway Station then entry tax is to be paid at that Railway Station. The payment of entry tax can be made either at the ICC or in the office of the Asst. Excise & Taxation Commissioner incharge of the district against a receipt in form TEG-II in any of the following modes

i)                     in cash or by way of Demand draft

ii)                   if permitted by the Excise & Taxation Commissioner, by cheques against the Bank guarantee

iii)                  with the prior approval of the Excise & Taxation Commissioner, deposited in the office of the Asst. Excise & Taxation Commissioner of respective district within 48 hours

iv)                 through online or card based modes available with the concerned authorized banks.

Return

There is no separate return prescribed for Entry tax but dealer is under an obligation to file the statement along with Quarterly return.

Deferment of Entry Tax

It is pertinent to point out that importer can defer his liability of entry tax by furnishing an undertaking where he is registered and for that he has to furnish the detail regarding the import of goods for which he has deferred the payment of entry tax as interim stay has been granted by the Hon’ble Punjab & Haryana High Court on the entry Tax in Punjab in the case of M/s Bhushan Steels and Power Ltd. Vs. State of Punjab and consequently a general circular has also been issued by the Punjab Govt. allowing all dealers by furnishing undertaking can get the benefit of deferment until the final orders of the court as it is yet to be decided whether entry tax in Punjab will stand or will be struck down if it lacks constitutional validity.

Conditions for Admissibility of entry tax paid:

            Section 13A under the Punjab Value Added Tax Act, 2005 stipulates Conditions for ITC admissibility in respect of entry tax paid by a taxable person. ITC would be admissible if the goods imported are for the purpose of:

            a)         Sale in the state

            b)         In the course of inter state trade or commerce

            c)         In the course of export

d)         For use in manufacturing activity of taxable goods within the state or In the course of inter state trade or commerce or In the course of export

List of Goods on which Entry Tax is applicable:

Name of Goods	Rate of Tax
1.         iron and steel which are mentioned in clause (iv) of Section 14 of the    Central Sales Tax Act, 1956, except the following goods	4%
(i)                 Steel bars (rounds, rods, squares, flats, octagons and hexagons, plain
and ribbed or twisted, in coil form as well as straight lengths);
(ii)        Steel structurals (angels, joints, channels, tees, sheet pilling sections,
Z sections or any other rolled section);
(iii)       Sheets, hoops, strips and skelp, both black and  galvanized, hot and  cold rolled, plain  and corrugated, in all quantities, in straight lengths and in  coil form, as rolled and in revetted conditions
(iv)       Plates both plain and chequered in all qualities;
(v)        Steel Slabs and Blooms ;
(vi)       Discs, rings forgings and steel castings;
(vii)        Steel tubes, both welded and seamless of all diameters and lengths
including tube fittings; and
(viii)     Wheels, tyres, axles and wheels sets.
2.      Lubricants	12.50%
3.      Furnace oil	4%
4.      D.G Set	12.50%
5.     All Kind of Cement	12.50%
6.      Electric Motors	12.50%
7.      Bitumen	5%
8.      Coal & Coke	4%
9.      All types of Plywood, Board (other than paper Board) and Sunmica	12.50%
10.   Girder (Joists), Angle, Channel, Thermo Mechanical Treated Bar (TMT Bar) and TOR Steel	4%
11.   Steel Fabricated Material and poles of Reinforced Cement Concrete and Steel	12.50%
12.   Reinforced Concrete Cement Pipes and Seamless Welded Pipes	5%
13.   Transformers & its accessories and Aluminium-cum-Steel-Reinforced	5%
14.   Sulphuric Acid, Hydrochloric Acid, Nitric Acid, Caustic Soda, Ethyle Acetate & Acetic Anhydride	5%
15.    Diesel of all kinds and Heavy Petroleum Stocks	8.80%
16.    All kinds of Oil Cakes, De-oiled Cakes (except Soya), Rice Bran and De-oiled Rice Bran	5%
17.    All kinds of tiles (except ashphaltic roofing earthen tiles)	12.5%
18.    All other types of yarn (excluding raw cotton, ginned cotton, shoddy and worsted yarn), partially oriented yarn, fibre, polyester top, polyester chips including waste thereof	5%
19.    All type of pulses	1%
20.    Cotton Yarn	4%
21.    DG Sets	12.5%
22.    Marble including Granite, Kota Stone, Red Sand Stone, Chips and Crazy	12.5%
23.    Milk to be used for manufacturing of taxable goods	5%
23.    Plastic Granules, Plastic Powder and Master Batches	8%
24.    Vanaspati and other edible oils (Refind or un-refined) excluding Crude	5%
25.     Vaneer	5%
26.     Wheat Flour (Branded), Maida (Branded) and Suzi (Branded)	5%