MVAT circular on Issuing of Tax Clearance Certificates

No.:-ACST VAT(3)/Tax Cl.Cer/

Trade Circular No.1T of 2010, Date: 05/01/2010

Sub: Issuing of Tax Clearance Certificates

Background: Certain dealers/persons approach the departmental authorities for the issue of “Tax Clearance Certificates” in respect of various taxes. At present, the tax clearance certificates are being issued by the VAT Recovery officers at most of the locations. It has been noticed that uniformity is not seen in the process adopted for issuing of such certificates and the proforma of such certificates is also noticed to be not in a standard format.

In view of this situation, it is necessary that the procedure for the issuing of such certificates should be standardized. Such certificates are very often required to be produced before various government authorities, local bodies or other bodies etc. for the purpose of tender, renewal of licenses etc.

2. Tax Clearance Certificates under the MVAT/CST Act:

As far as the recovery position of a dealer is concerned two types of certificates are issued by the sales tax authorities i.e. “Tax Clearance Certificate” and the “Tax Dues Certificate”. As per the provisions of Section 32(8)(a), (read with MVAT rule 42) application for the “Tax Clearance Certificate” should be made in Form 414. The “Tax Clearance Certificate” should be in Form 415 [MVAT Sec. 32(8)(a) read with MVAT rule 43]. “Tax Dues Certificate” has to be issued in Form 416 [MVAT section 32(8)(b) read with MVAT Rule 44]. It may be noticed that these are Forms prescribed under the MVAT rules; hence any of the departmental authorities is not permitted to deviate from this format.

Under the PT Act/Rules, no such formats have been prescribed. However in order to standardize the procedure, the format for the issue of “Tax Clearance Certificate” is being provided in the Annexure.

3. Generation of Certificates through Mahavikas:

Module for the generation of Tax Clearance Certificates and Tax Dues Certificate is already available. All the concerned officials are hereby instructed that alt these certificates should be generated through Mahavikas only. Access rights for the issue of such certificates have been given to the concerned officials.

4. Issuing Authority:

Tax Clearance Certificate in the case of dealers, holding VAT/CST TIN shall be issued by the VAT Recovery Officer. VAT Recovery Officer in such cases shall issue the TAX clearance certificate for VAT/CST as well as other Acts, if the dealer has applied for the clearance certificate for all Acts. He may call for the recovery/dues position for PT from the Profession Tax Office.

In case the applicant dealer does not hold VAT/CST TIN then the Tax Clearance Certificates shall be issued by the PTO.

5. This circular cannot be made use of for legal interpretation of provisions of law, as it is clarificatory in nature. If any member of the trade has any doubt, he may refer the matter to this office for further clarification.

6. You are requested to bring the contents of this circular to the notice of the members of your association.

(SANJAY BHATIA)

Commissioner of Sales Tax,

Maharashtra State, Mumbai.

Annexure

Tax Clearance/Dues Certificate

To,

____________ _____,

____________ _____,

____________ _____.

Subject: Tax Clearance Certificate for PT Act, 1975, / Luxury Tax Act

Name of the Dealer/person
EC Number under PT Act, 1975
RC Number under PT Act, 1975
Address of the place of business/place of work

Details of tax Dues for PT RC:

Sr No	Period	Amount of tax dues as per returns	Amount of other dues, if any	Remarks

Details of tax Dues for PT EC:

Sr No	Period	Amount of tax dues as per returns	Amount of other dues, if any	Remarks

This is to certify that no dues, except those mentioned herein above are pending as on date of issue of this certificate.

Seal

Place

Signature___ _________ _______

Dated

Designation_ _________ _______

No.:-ACST VAT(3)/Tax Cl.Cer/

Trade Circular No.1T of 2010, Date: 05/01/2010

Sub: Issuing of Tax Clearance Certificates

Background: Certain dealers/persons approach the departmental authorities for the issue of “Tax Clearance Certificates” in respect of various taxes. At present, the tax clearance certificates are being issued by the VAT Recovery officers at most of the locations. It has been noticed that uniformity is not seen in the process adopted for issuing of such certificates and the proforma of such certificates is also noticed to be not in a standard format.

In view of this situation, it is necessary that the procedure for the issuing of such certificates should be standardized. Such certificates are very often required to be produced before various government authorities, local bodies or other bodies etc. for the purpose of tender, renewal of licenses etc.

2. Tax Clearance Certificates under the MVAT/CST Act:

As far as the recovery position of a dealer is concerned two types of certificates are issued by the sales tax authorities i.e. “Tax Clearance Certificate” and the “Tax Dues Certificate”. As per the provisions of Section 32(8)(a), (read with MVAT rule 42) application for the “Tax Clearance Certificate” should be made in Form 414. The “Tax Clearance Certificate” should be in Form 415 [MVAT Sec. 32(8)(a) read with MVAT rule 43]. “Tax Dues Certificate” has to be issued in Form 416 [MVAT section 32(8)(b) read with MVAT Rule 44]. It may be noticed that these are Forms prescribed under the MVAT rules; hence any of the departmental authorities is not permitted to deviate from this format.

Under the PT Act/Rules, no such formats have been prescribed. However in order to standardize the procedure, the format for the issue of “Tax Clearance Certificate” is being provided in the Annexure.

3. Generation of Certificates through Mahavikas:

Module for the generation of Tax Clearance Certificates and Tax Dues Certificate is already available. All the concerned officials are hereby instructed that alt these certificates should be generated through Mahavikas only. Access rights for the issue of such certificates have been given to the concerned officials.

4. Issuing Authority:

Tax Clearance Certificate in the case of dealers, holding VAT/CST TIN shall be issued by the VAT Recovery Officer. VAT Recovery Officer in such cases shall issue the TAX clearance certificate for VAT/CST as well as other Acts, if the dealer has applied for the clearance certificate for all Acts. He may call for the recovery/dues position for PT from the Profession Tax Office.

In case the applicant dealer does not hold VAT/CST TIN then the Tax Clearance Certificates shall be issued by the PTO.

5. This circular cannot be made use of for legal interpretation of provisions of law, as it is clarificatory in nature. If any member of the trade has any doubt, he may refer the matter to this office for further clarification.

6. You are requested to bring the contents of this circular to the notice of the members of your association.

(SANJAY BHATIA)

Commissioner of Sales Tax,

Maharashtra State, Mumbai.

Annexure

Tax Clearance/Dues Certificate

To,

____________ _____,

____________ _____,

____________ _____.

Subject: Tax Clearance Certificate for PT Act, 1975, / Luxury Tax Act

Name of the Dealer/person
EC Number under PT Act, 1975
RC Number under PT Act, 1975
Address of the place of business/place of work

Details of tax Dues for PT RC:

Sr No	Period	Amount of tax dues as per returns	Amount of other dues, if any	Remarks

Details of tax Dues for PT EC:

Sr No	Period	Amount of tax dues as per returns	Amount of other dues, if any	Remarks

This is to certify that no dues, except those mentioned herein above are pending as on date of issue of this certificate.

Seal

Place

Signature___ _________ _______

Dated

Designation_ _________ _______