Extension Order passed by the Commissioner for framing an assessment after the period of 3 years was set aside by the Hon'ble Punjab VAT Tribunal, Chandigarh

Assessment plays vital role under the Punjab Value Added Tax Act, 2005 and the period for framing an assessment is 3 years from the date of filing of an annual statement i.e. 20^th of November but the power conferred to extend the period for framing an assessment after the 3 years has its own importance as the commissioner can extend the time period upto 6 years from the date of filling of annual statement but this power can only be exercised where circumstances so warrant so the legislature has given this power to the commissioner for extending the period under some special circumstances but this power cannot be exercised after the period of 3 years if the orders for extension will be passed after the lapse of 3 years then it has no legal sansity beside this if commissioner want to extend the time under the “circumstances so warrant” such circumstances could be that the assessment Proceedings remained stayed under order of the High Court or any competent authority or that some enquiry was pending, which could not be completed before the expiry of limitation period or that some information was being collected from certain sources or that some natural calamity had obstructed the Designated Officer to proceed further in the matter and so on. These powers cannot be exercised as a matter of routine or convenience or to cover up the lackadaisical attitude or dalliance or laying of the Designated Officer power of framing of assessment. The Ld. Commissioner is under an obligation to serve notice on the appellant as per Rule 86 of the Punjab Value Added Tax Rules, 2005, but the same was not followed and the practice under the Punjab Value Added Tax Act, 2005 for framing an assessment after the period of 3 years was challenged for the year 2007-08 in the case of M/s Aman Enterprises vs. State of Punjab and the same was decided vide order dated 04.05.2012 in favour of appellant. Copy of the same is enclosed.

Note on Entry Tax under the Punjab Tax on Entry of Goods into Local Areas Act, 2000

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

  

Revised Rate of Entry Tax from 18.09.2012: