Wheat and Paddy which are declared goods  under CST Act 1956, have been added to schedule B of Punjab VAT Act  2005. The goods contained in schedule B of PVAT act 2005 are taxable @ 5%. An additional surcharge @ 10% is also applicable. But such surcharge will not be applicable on wheat and paddy since these goods are declared goods as per section 14 of CST Act 1956.

Ceiling rate of declared goods was enhanced to 5% by Central Govt. in the last budget of 2011-12. Hence State Governments cannot levy tax more than 5% on declared goods. Therefore Wheat and Paddy will be taxable @ 5% only and no surcharge of 10% is applicable on it.

The relevant notification is produced herebelow for ready refernce of all concerneds:

The April, 2011
No. S.O.     /P.A.8/2005/S.8/2010- 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 amendment in Schedule ‘B’, appended to the said Act, with immediate effect, by dispensing with the condition of previous notice namely:-
In the said Schedule, after serial No. 161 and the entries relating thereto, the following serial No. shall be added, namely:-
“162. Wheat and paddy.”
Financial Commissioner, Taxation and
Secretary to Government of Punjab,
Department of Excise and Taxation


(Author – Amit Bajaj Advocate, Bajaj & Bajaj Advocates, 128, Sangam complex, Milap chowk, Jalandhar City (Punjab), Email: amit@amitbajajadvocate.com, M +919815243335)

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