FIRST POINT TAX LEVIED ON FEW COMMODITIES UNDER THE PUNJAB VAT ACT 2005 & SUBSEQUENT SALE IS TAX FREE W.E.F. 01ST JANUARY 2014.

Punjab Excise & taxation department has issued a notification under the Punjab Vat Act 2005 which is applicable with effect from 01 Jan 2014, but strange rather shocking Excise & Taxation Department has issued the notification which reflects that tax was levied at the first stage that is in the hand of manufacturers and importers in the state of Punjab and after that no tax will be charged in the hands of distributors, wholesalers or retailers. It clearly infers that this notification is not as per the spirit of the Punjab Vat Act 2005 as the scheme of Punjab Vat Act 2005 no where permits the levy at first stage.

EFFECTS OF THE NOTIFICATION:

GOODS subject to the tax @ 14.5% & 22.5% have been notified and the surcharge at the rate of 10% will be separately leviable in terms of section 8-B of the Punjab Vat Act 2005 which ultimately resulted in increase of tax from 14.5% to 15.95% and from 22.5% to 24.75% which clearly reflects that with every sunrise Excise & taxation department is saddling the assesses with heavy tax liability without giving any prior notice as required under section 8(3) of The Punjab Vat Act 2005.

The Copy of the notifications is attached below by virtue of which commodities mentioned in the Schedule E from serial no 15 to 20 are subject to tax at first point of sale in the hands of manufacturer or first importers stage at the rates specified in the notification reflected in in Schedule E appendix to Punjab Vat Act 2005, here it is pertinent to point out that subsequent sale of these commodities will be considered as tax free & by virtue of this Schedule A which deals with tax free goods appendix to the Punjab Vat Act 2005 was also amended.

Applicability:

The amendments made by virtue of notifications no. S.O.116/P.A8/2005/S.8/2005/S.8/2013 & S.O 117/P.A.8/2005/S.8/2013 which deals with Schedule A & E of The Punjab vat Act 2005 are applicable from 1st January 2014.

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Authored by

J S BEDI Advocate

Email ID: bediadvocate@yahoo.co.in

Contact Number: 98140-66336

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GOVERNMENT OF PUNJAB

DEPARTMENT OF EXCISE & TAXATION

(EXCISE AND TAXATION-II BRANCH)

NOTIFICATION

The 13th December, 2013

S.O.116/P.A8/2005/S.8/2005/S.8/2013 – Whereas the State Government is satisfied that circumstances exist, which render it necessary to take immediate action in public interest;

Now, therefore, in exercise of the powers conferred by sub section (3) of section 8 of the Punjab Value Added Tax Act, 2005 (Punjab Act No. 8 of 2005) and all other powers enabling him in this behalf, the Governor of Punjab is pleased to make the following amendments in Schedule ‘A’, appended to the said Act, with effect from 1st January, 2014, by dispensing with the condition of previous notice, namely:-

AMENDMENT

In the said Schedule ‘A’, after serial No. 85, the following serial No. 86 to 91 and the entries relating thereto, shall be added. These commodities shall be tax free at the wholesaler or distributor or retailer stage provided that tax has already been paid at the first point of sale i.e manufacturer or first importer’s stage.

S.No.

Commodity Name

86

  All types of Televisions, Refrigerators, Washing Machines, Microwave ovens, Oven Toaster Grillers (OTGs), Home Theatres, and Air Conditioners

87

  Kitchen Appliances like sandwich makers, tea/coffee makers, juicer mixer grinders (JMGs), hand blenders, electric rice cookers, electric tandoors, induction cook tops, electric chimneys, electric fryers

88

  Cold Drinks (Aerated Drinks)

89

  All types of personal care products such as deodorants, shaving products, beauty soaps, shampoos, hair oil, conditioners, serums, hair care products, tooth pastes, hand wash, body wash, beauty products, hair gels, bathing gels, talcum powders, creams, anti-persiprants, petroleum jellies, baby care products, skin care lotions and after shaving lotion

90

  All types of soaps and detergents such as washing bars and soaps, fabric softeners, bleach, gentle wash, dish wash, color care, Neel

91

  All types of branded or packaged food products such as chips, wafers, chocolates, toffees, ice creams, Corn Flacks, pasta, macroni, biscuits, frozen desserts, frozen products, meal makers, instant soups , instant noodles, ready to eat products, namkeens, custard powder, snacks, bakery products, baby foods etc

 D.P. REDDY,

Financial Commissioner Taxation and

Secretary to Government of Punjab,

Department of Excise and Taxation

 ————————————————————–

GOVERNMENT OF PUNJAB

DEPARTMENT OF EXCISE & TAXATION

(EXCISE AND TAXATION-II BRANCH)

NOTIFICATION

The 13th December, 2013

NO S.O 117/P.A.8/2005/S.8/2013 – Whereas the State Government is satisfied that circumstances exist, which render it necessary to take immediate action in public interest;

Now, therefore, in exercise of the powers conferred by sub section (3) of section 8 of the Punjab Value Added Tax Act, 2005 (Punjab Act No. 8 of 2005) and all other powers enabling him in this behalf, the Governor of Punjab is pleased to make the following amendments in Schedule ‘E’, appended to the said Act, with effect from 1st January, 2014, by dispensing with the condition of previous notice, namely:-

AMENDMENT

In the said Schedule ‘E’, after serial No. 14, the following serial No. 15 to 20 and the entries relating thereto, shall be added. These commodities shall be taxable at the first point of sale i.e manufacturer or first importer’s stage, at the rates specified against these entries in the Table given below, namely:-

S.No.

Commodity name

Rate Of Tax

15

All types of Televisions, Refrigerators, Washing Machines, Microwave ovens, Oven Toaster Grillers (OTGs), Home Theatres, and Air Conditioners

14.5 percent

16

Kitchen Appliances like sandwich makers, tea/coffee makers, juicer mixer grinders (JMGs), hand blenders, electric rice cookers, electric tandoors, induction cook tops, electric chimneys, electric fryers

14.5 percent

17

Cold Drinks (Aerated Drinks)

22.5 percent

18

All types of personal care products such as deodorants, shaving products, beauty soaps, shampoos, hair oil, conditioners, serums, hair care products, tooth pastes, hand wash, body wash, beauty products, hair gels, bathing gels, talcum powders, creams, anti-persiprants, petroleum jellies, baby care products, skin care lotions and after shaving lotion

14.5 percent

19

All types of soaps and detergents such as washing bars and soaps, fabric softeners, bleach, gentle wash, dish wash, color care, Neel

14.5 percent

20

All types of branded or packaged food products such as chips, wafers, chocolates, toffees, ice creams, Corn Flacks, pasta, macroni, biscuits, frozen desserts, frozen products, meal makers, instant soups , instant noodles, ready to eat products, namkeens, custard powder, snacks, bakery products, baby foods etc

14.5 percent

D.P. REDDY,

 Financial Commissioner Taxation and

Secretary to Government of Punjab,

Department of Excise and Taxation

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