The Punjab Value Added Tax Act 2005 has been amended vide Notification No. 49-Leg/2013, dated 15th November, 2013. A number of amendments have been made by this notification. Amendments made to section 4 of Punjab Vat Act, 2005 have been analysed in this article.

Amendment in Section 4 of Punjab Act 8 of 2005

Section 4 of Punjab VAT Act has been amended, which relates to constitution of VAT Tribunal. It provides the constitution of Tribunal, number of members in Tribunal, their qualification, appointment office holding period, power and duties of Tribunal members, chairman and Vice – chairman  besides service conditions, salaries and allowances, removal and resignation of Chairman and members of the Tribunal.

Recently Hon’ble Punjab & Haryana High Court has directed the Punjab Government for the appointment of all the members of the Tribunal as provided in the Punjab VAT Act, since till date the Chairman alone is carrying on the operations of the Tribunal. But surprisingly, the government choose to amend the Act itself instead of appointing all the members of the Tribunal, reasons best known to the State Government.

Sub – section (2) of Section 4 has been amended to provide that the Tribunal may consist of a chairman and three other members to be appointed by the State Government.

The word “shall” has been replaced with the word “may” in the aforesaid amendment which means that it is not necessary that the Chairman and all the members must be appointed. The operations of the Tribunal may be run by any number of members  and that too with or without the chairman of the Tribunal.

Before above amendment, Section 4 of Punjab Vat Act, 2005 stood as under:


(1)       The State Government shall, by notification in the Official Gazette, constitute a Tribunal to exercise the powers and discharge the functions conferred on it under this Act.

(2)       The Tribunal shall consist of a Chairman and three other members to be appointed by the State Government.

(3)       The Chairman shall either be a retired Judge of the High Court or a retired or serving officer of the rank of Chief Secretary to the State Government or Secretary to Government of India.

(4)       The members appointed under sub-section (2), shall have the following qualifications and experience, namely:-

(a)       should be a law graduate and should have at least fifteen years experience of practising in the High Court or the Supreme Court of India in tax matters; or

(b)       should be a retired or a serving Officer of the Excise and Taxation Department of the State with at least two years experience of the post of Additional Excise and Taxation Commissioner; or

(c)        should have at least fifteen years experience of practicing as a Chartered Accountant under the Chartered Accountant Act, 1949 (Central Act 38 of 1949), or is a member or should have been a member or should be eligible for appointment as a member of the Customs, Excise and Service Tax Appellate Tribunal constituted by the Union Government : and

(d)       [***]

Provided that one member of the Tribunal shall be appointed from each of the aforesaid categories.

(5)       The State Government may appoint one of the members, to be a Vice-Chairman of the Tribunal.

(6)       The Vice-Chairman shall exercise such powers and perform such functions of the Chairman, as may be delegated to him by the Chairman by a general or special order in writing. In the absence of the Chairman, the Vice-Chairman shall act as Chairman.

(7)       The Chairman or a member of the Tribunal shall hold office for a term of three years from the date he assumes charge of his office and he shall not be eligible for re-appointment.

(8)       No person shall be appointed or continue as Chairman or Member of the Tribunal, if he has attained the age of sixty-seven years.

(9)       The Chairman, Vice-Chairman and other members of the Tribunal shall be entitled to such salaries and allowances and shall be governed by such conditions of service, as may be specified by the State Government.

(10)     The Chairman, the Vice-Chairman or a member of the Tribunal may be removed from the office by the State Government, if

(a)       he is adjudged an insolvent; or

(b)       he takes up employment outside the duties of his office; or

(c)        he has become incapable of performing his duties on account of unsoundness of mind or any other reason; or

(d)       he is guilty of such misconduct as would render him unfit to continue as Chairman or Vice-Chairman or member of the Tribunal; or

(e)       he is convicted of an offence involving moral turpitude.

(11)     The Chairman, the Vice-Chairman or a member, as the case may be, may at any time by writing under his hand addressed to the State Government, resign his office, but his resignation shall take effect from the date on which it is accepted.

(12)     The Chairman, the Vice-Chairman and members of the Tribunal shall be deemed to be public servants within the meaning of section 21 of the Indian Penal Code (Act 45 of 1860).

(13)     No order made or act done, or proceedings taken under this Act by or before the Tribunal, shall be called in question in any manner on the ground of merely of any defect in the constitution of the Tribunal.

(14)     The Tribunal shall have power to award costs. The arrears of such costs shall be recoverable as arrears of land revenue.

(15)     Subject to the previous sanction of the State Government, the Tribunal shall for the purpose of regulating its procedure, make regulations in conformity with the provisions of this Act and the rules made there under.

(16)     Subject to the directions given by the State Government, the Tribunal shall sit at such place or places, as it may deem fit.

(17)     The State Government may, appoint such officers or officials, as may be considered necessary to enable the Tribunal to carry out its functions under this Act.

(18)     The administrative expenditure of the Tribunal including salaries, allowances and pensions, if any, payable to the Chairman, Vice-Chairman, members, officers and officials of the Tribunal, shall be charged upon the Consolidated Fund of the State.

CA Narinder Gupta
Narinder Gupta & Co.
47- Near New Judicial Court Complex,
Opposite Judge’s Residence Gate
Rajpura – 140401
9779023228, 9417023228

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