LexThe Nagaland Value Added Tax Act, 2005
Nagaland · state statute
Open in Lexace · Ask the AI about this actThe Nagaland value Added Tax Act, 2005. (Act No. 4 of 2005) Received the assent of the Governor of Nagaland on 31/03/2005 and published in the Nagaland Gazette Extraordinary dated: 5 11 of May, 2005. An -Act- To levy tax on sale of goods in Nagaland on the basis of value added to such goods at each stage of sale of such goods and on purchase of certain goods in Nagaland in specified circumstances and to provide for matters connected therewith or incidental thereto. Whereas it is expedient to provide for the levy of tax on sale or goods in Nagaland on he basis of value added to such goods, at each stage of sale of such goods and on purchase of certain goods in Nagaland in specified circumstances and to provide for matters connected therewith or incidental thereto: It is hereby enacted in the fifty-sixth year of the Republic of India, by the Legislative of Nagaland as follows:- Chapter - I Preliminary 1. Short title, extend and commencement: (a) This Act may be called the Nagaland Value Added Tax Act, 2005 (b) it extends to the whole of the State of Nagaland. (c) This section shall come into force at once; and the remaining provisions of this Act shall come into force on such date or dates as the state government may, by notification, appoint, and different dates may be appointed for different provisions of this Act. 2. Definition-In this act unless the context otherwise requires (i) "Act" means the Nagaland Value Added Tax Act, 2005 (ii) "Appellate Tribunal" means the Appellate Tribunal appointed undeeer Section 4 (iii) "Assessee" means any person by whom tax or other sum of money is payable under this act and includes every person in respect of whom any proceedings under this Act have been taken for the assessment of tax payable by him; (iv) "Assessing authority" means any person not below the rank of a Superintendent of Taxes authorized by the Government or by any authority empowered by the Government to make any assessment under this Act' -13- (v) "Business" include- a. Any service b. Any trade, commerce, or manufacture' c. Any adventure or concern in the nature of service, trade commerce, manufacture. d. Any transaction in connection with, or incidental or ancillary to such service, trade, commerce, manufacture, adventure or concern; e. Whether or not such service, trade, commerce, manufacture, adventure, concern is carried on with a motive to make gain or profit and whether or not any profit accrues from such service, trade, commerce, manufacture, adventure, or concern; and any transaction in connection with, or ancillary or incidental to, such trade, commerce, manufacture, execution of works contract, T adventure or concern; (vi) "Capital goods" means- a. Machine, machinery, plant, equipment, apparatus, tools, appliances or electrical installation used for producing, making, extracting or procuring of any goods or for bringing about any change in any substance for the manufacture of final products, b. Components, spare parts and accessories of such machine, machinery, plant, equipment, apparatus, or electrical installation used for the purposes as stated in clauses (a). (vii) "Casual trader" means a person who whether as principal, agent or in any other capacity, has occasional transactions involving buying selling, supplying or distributing goods in the state, whether for cash or for deferred payment, or for commission, remuneration, or other valuable consideration; (viii) "Commissioner" means the Commissioner of Taxes appointed under sub-section (10 of Section 3; (ix) "Dealer" means any person who carries on the business of buying selling, supplying or distributing goods, executing works contract, delivering any goods on hire-purchase or any system of payment by installments, transferring the right to use any goods directly or otherwise, whether for cash or for deferred payment, or for commission, remuneration, or other valuable consideration and includes; -14- a. A casual trader; b. A commission agent, a broker or a del credere agent or an auctioneer or any other mercantile agent, by whatever-name called; c. A non-resident dealer or an agent of a non-resident dealer, or a local branch of a firm or company or association or body of person whether incorporated or not, situated outside the State; d. Government, a local authority, a statutory body, a trust or other body corporate which or who whether or not in the course of business sales, supplies or distribute directly or otherwise goods for cash or for deferred payment or for commission, remuneration or other valuable consideration. e. A co-operative society, club or any association which sale goods to its member. f. A person who, whether in the course of business or not -- G) - Sells goods produced by him by manufacture, agriculture, horticulture or otherwise; or (ii) Transfers any goods, including controlled goods whether in pursuance of a contract or not for cash or for deferred payment or for other valuable consideration; (iii) Supplies, by way of or as part of any service or in any other manner whatsoever, goods, being food or any drink (whether or not intoxicating), where such supply or service is for cash, deferred payment or other valuable consideration; (x) "Declared goods" means goods declared to be of special importance in inter-state trade or commerce under Section 14 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956); (xi) "Deputy Commissioner" means any person appointed to be a Deputy Commissioner of Taxes under this Act. (xii) "Deputy Commissioner (Appeals)" means any person appointed to be Deputy Commissioner (Appeals) under this Act; (xiii) "goods" means all kinds of moveable property (other than newspaper, actionable claims, electricity, stocks and shares and securities) and includes live stock, all materials, commodities and articles and every kind of property (whether as goods or in some other form) involved in the execution of a works contract, and all growing crops, grass or things attached to, or forming part of the land which are agreed to be severed before sale or under the contract of sale; (xiv) "Government" means State Government of Nagaland; -15- (xv) "Input Tax" means the tax paid or payable under this act by a registered dealer to another registered dealer on the purchase of goods in the course of business for resale or for the manufacture of taxable goods or for use as containers or packing materials or for the execution of works contract; (xvi) "Input tax credit" or "input tax rebate" in relation to any period means the setting off of the amount of input tax, or part thereof, by a registered dealer against the amount of his output tax; (xvii) "Interest due" means the amount of interest which remains unpaid after the expiry of the date specified in the notice of demand issued in this behalf under this act or the rules made there under; (xviii) "Manufacture" with all its grammatical variation and cognate expression means producing, making, extracting, altering, ornamenting, finishing, assembling or otherwise processing, treating or adapting any goods, but does not include any such process or mode of manufacture as may be prescribed; (xix) "Output tax" means the tax charged or chargeable under this Act by a registered dealer for the sale of goods in the course of business; (xx) "Person" includes- a. An individual; b. Ajoint family; c. A company; d. A firm; e. An association of persons or a body of individual; whether incorporated or not; f. The Central Government or the Government of Nagalandpr the Government of any other State or Union Territory in India; g. A local authority; (xxi) "Place of business" means any place where a dealer carries on the business and includes- a. Any warehouse, godown or other place where a dealer stores or processes his goods; b. Any place where a dealer produces or manufactures goods; c. Any place where a dealer keeps his books of accounts; d. In case where a dealer carries on business through an agent (by whatever name called), the place of business of such agent; e. Any vehicle or vessel or any other carrier wherein the goods are stored or used for transporting the goods; (xxii) "Prescribed" means prescribed by Rules made under this Act; -16- (xxiii) "Purchase" with all its grammatical variation and cognate expressions shall be construed from the word "Sale"; (xxiv) "Registered dealer" means that portion of input tax of the goods for which credit has been availed but such goods are used subsequently for any purpose other than resale or manufacture of taxable goods or execution of works contract or use as containers or packing materials within, the State; (xxv) "Sale" with all its grammatical variation and cognate expression means every transfer of the property in goods, other than by way of mortgage, hypothecation, charge or pledge, by one person to another in the course of trade or business for cash, deferred payment or other valuable consideration and includes:- a. Transfer, otherwise than in pursuance of a contract of property in goods for cash, deferred payment or other valuable consideration; b. Transfer of property in goods (whether as goods or in some other form involved in the execution of a works contract; c. Delivery of goods on hire purchase or any other system of payment by installments; d. A transfer of the right to use any goods for any purpose, whether or not for specified period for cash, deferred payment or any other valuable consideration; e. A transfer of goods by any unicorporation association or body of person to a member thereof for cash, deferred payment or any other valuable consideration; f. A supply, by way of or as part of any; service or in any other manner whatsoever, of goods being food or any other article for human consumption or any drink (whether or not intoxicating) where such supply or service is for cash, deferred payment or any other valuable consideration; g. A transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or any other valuable consideration, and such transfer, delivery or supply of any goods shall be deemed to be a sale of those goods by the person making the transfer, delivery or supply and purchase of those goods by the person to whom such transfer, delivery or supply is made, but does not include a mortgage, hypothecation, charge or pledge. -17- Explanation: i. A sale or purchase of goods shall not be deemed to have taken place inside the state if the goods are sold:- a. In the course of inter-State trade or commerce; or b. Outside the State of Nagaland; or c. In the course of import or export of goods; ii. Where there is a single contract of sale or purchase of goods situated at more place than one, the provisions of this explanation shall apply as if there were separate contract in respect of the goods at each of such places. (xxvi) "Sale price" means the amount of valuable consideration received or receivable by a dealer for the sale of any goods less any sum allowed as cash discount, according to the practice normally prevailing in the dealer in respect of the goods or services at the time of or before delivery thereof, excise duty, special excise duty or any other or taxes except the tax imposed under this Act. (xxvii) "State" means the State of Nagaland; (xxviii) "Tax" means the tax payable under this Act; (xxix) "Tax invoice" means a document listing goods sold with price, quantity and other details as specified in this Act and includes a statement of account, bill, cash register, slip receipt or similar record, regardless of its form; (xxx) "Taxable turnover" means the turnover on which a dealer shall be liable to pay tax as determined after making such deductions from his total turnover and in such manner as may be 1prescribed; (xxxi) "Turnover" means the aggregate amount for which goods are either bought or sold, supplied or distributed by a dealer either directly or through another, on his own account or on account of others, whether for cash or for deferred payment or for other valuable consideration; Explanation - (1) The turnover in respect of delivery of goods on hire purchase or on any system of payment by installments shall be the market price of the goods so delivered. (2) The turnover in respect of the transfer of the right to use any goods shall be the aggregate amount received or receivable by the dealer as consideration for such transfer. -18- (3) Subject to such condition and restrictions, if any, as may be prescribed in this behalf; (a) The amount for which goods are sold shall include any sums charged for anything done by the dealer in respect of the goods sold at the time of, or before the delivery thereof. (b) Any cash discount on the price allowed in respect of any sale or any amount refunded in respect of articles returned by customers shall not be included in the turnover; and (c) Where for accommodating a particular customer, a dealer obtains goods from another dealer and immediately disposes of the same to the said customer; the sale in respect of such goods shall be included in the turnover of the latter dealer but not in that of the former. e(xxxii) "Value added tax' means a tax on sales or purchases levied under this Act. (xxxiii) "Vehicle" includes every wheeled conveyance used for the carriage of goods solely or in addition to passengers. (xxxiv) "Vessel" includes any ship, barge, boat, raft, timber, bamboos or floating materials propelled in any manner. (xxxv) "Year" means the financial year beginning from 1St April and ending with 31st March. CHAPTER —II AUTHORITIES AND APPELLATE TRIBUNAL 3. Taxing authorities - (1) The State Government may, for carrying out the purposes of this Act, appoint a Commissioner of Taxes and such other persons to assist him as it thinks fit. The Commissioner shall have all the powers and shall perform all the duties conferred or imposed upon him by or under this Act. (2) The Commissioner shall have superintendence over all officers and persons employed in the execution of this Act and the Commissioner may- a. Call for returns from such officers and persons; b. Make and issue general rules and specify forms for regulating the practice and proceedings of such officers and persons; -19- c. Issue such orders, instructions and directions to such officers and persons as it may deem fit, for the proper administration of this Act. (3) The Government shall appoint as many Additional Commissioners, Deputy Commissioners, Assistant Commissioners, Superintendent of Taxes and such other person as the Government may think fit for the purpose of performing the functions respectively assigned to them by or under this Act. Such officers shall perform the said functions within such local limits as the Commissioner may assign to them. (4) All officers and persons employed for the execution of this act shall observe and follow the orders, instructions and directors of the officers superior to them. (5) The Commissioner may by order in writing:.- a. Transfer any case or cases relating to any assessee or class of assesses pending before an Assessing Authority to another Assessing Authorities having jurisdiction to deal with such case or cases; or b. Specify one of the Assessing Authorities having jurisdiction over an area, which shall deal with any case or cases relating to any assessee or class of assesses. Where any case is transferred to an assessing authority under clause (a) of sub-section (5), such Assessing Authority may deal with the case either de novo or from the stage at which it ws transferred. (6) a. The Additional Commissioners shall perform their functions in respect of such areas or of such dealers or classes of dealer or of such cases or classes of cases as the Commissioner may direct; b. The Deputy Commissioner shall perform their functions in respect of such areas or of such dealers or classes of dealers or of such cases or classes of cases as the Commissioner may direct; Where any direction issued under clause (b) assigned to two or more Deputy Commissioners, the same area or the same dealers or classes of dealers or the same cases or classes of cases, they shall perform their functions in accordance with any order with Commissioner may make for the distribution and allocation of the work to be performed; (7) a. The Assistant Commissioners of Taxes shall perform their functions in respect of such areas or of such dealers or classes of dealers or of such cases or classes of cases as the Commissioner may direct. b. -Where any direction issued under clause (a) have assigned to two or more Assistant Commissioners of Taxes, the same area or the same -20- dealers or classes of dealers or the same cases or classes of cases, they shall perform their functions in accordance with any order the Commissioner may make for the distribution and allocation of the work to be performed; (8) a. The Superintendents of Taxes shall perform the powers and functions in respect of such areas or of such dealers or classes of dealers or such cases or classes of cases or a combination thereof as the Commissioner may direct. b. Where any direction issues under clause (a) have assigned to two or more Superintendent of Taxes, the same area or the same dealers or classes of dealers or the same cases or classes of Taxes, they shall perform their functions in accordance with any order the Commissioner may make for the distribution and allocation of the work to be perfoiiiied; (9) a. The Commissioner may, by general or special order in writing, direct that the powers conferred on the superintendent of taxes by or under this Act, shall in respect of any specified cases or classes of cases, or any specified dealers or classes of dealers may be exercised by the Assistant Commissioners of Taxes. b. Where an order under clause (a) is issued, then for the purposes of any case or dealer in respect of which any such order applies, reference in this Act or in any rule made there under to the Superintendent of Taxes or prescribed authority shall be deemed to be references to the Assistant Commissioners of Taxes; (10) In this Section, the word "case" in relation to any dealers specified in any order or direction issued thereunder means all proceedings under this Act in respect of any year which may be pending on the date of such order or direction or which may have been completed on or before such date, and include also all proceedings under this Act which may have commenced after the date of such order or direction in respect of any year. 4. Appellate tribunal: The Government may appoint an appellate tribunal consisting of a chairperson and as many other members as it think fit to perform the functions assigned to the Appellate tribunal by or under this Act. -21- 5. Delegation of the Commissioner's powers and function: Subject to such restrictions and conditions as may be prescribed, the Commissioner may by order in writing, delegate any of his powers and functions under this Act and the Rules made thereunder to any person appointed under Sub- Section (3) of Section 3. 6. Persons appointed under section 3 and members of appellate tribunal to be public servants: The commissioner and all officers appointed under Section 3 including the members of the appellate tribunal shall be deemed to be public servants within the meaning of Section 21 of Indian Penal Code. 7. Indemnity: No suit, prosecution or other legal proceeding shall lie against any government servant employed for execution of the provisions of this Act and 1 rules made thereunder for anything which is in good faith done or intended to be done thereunder. CHAPTER -Ill THE INCIDENT LEVY AND RATE OF TAX 8. Incidence of tax: (1) Every dealer: a. Whose gross turnover of sale or purchases during the year immediately preceding the commencement of this act exceeded the taxable limit, or b. To whom clause (a) does not apply, and i. Whose gross turnover first exceeds the taxable quantum during any period of twelve consecutive months, or ii. Who has become liable to pay tax under the Central Sales Tax Act, 1956, or iii. Who is registered as a dealer under the Central Sales Tax Act, 1956 or under this Act at any time after the commencement of this Act, shall be liable to pay tax in accordance with the provisions of this Act. (2) Every dealer is liable to pay tax under sub-section (1) on purchases and sale affected by him: a. In case of clause (a) of sub-section (1) with effect from the sate of commencement of business; -22- b. In case of sub-clause (i) of clause (b) of sub-section (1) with effect from the date immediately following the day on which his gross turnover first exceeded the taxable limit during a period of any twelve consecutive months, and c. In case of sub-clause (ii) and (iii) of clause (b) of sub-section (1), with effect from the date of registration or the date on which he becomes so liable whichever is earlier. (3) Every dealer who has become liable to pay tax under this Act, shall continue to be so liable until the expiry of three consecutive years during each of which his gross turnover has failed to exceed the taxable limit and his liability to pay tax under this act shall cease on the expiry of the period specified above. (4) Every dealer who has ceased to be liable under sub-section (3) shall be again liable to pay tax under this act with effect from the date immediately following a period not exceeding twelve consecutive months during which his gross turnover again exceeds the taxable quantum. (5) For the purpose of this Act, taxable limit means in relation to any dealer who: a. Imports for sale any goods into the State of Nagaland on his own behalf or on behalf of his principal including casual trader- Nil b. Manufactures or produces any goods for sale - Rs. 300000 c. Is engaged in any other business other that clause (a) and (b) - Rs. 300000 d. Involved in the execution of work contract - Rs. 300000 (6) For the purpose of calculating the gross turnover to determine the liability to pay tax under the Act. a. Except as otherwise expressly provided, the turnover of all sales or as the case may be the turnover of all purchase shall be taken, whether such sales or purchases are taxable or not, and b. The turnover shall include all sales and purchases made by a dealer on his own account and also on behalf of principals whether disclosed or not. (7) Whereby any order passed under this act, it is found that any person registered as a dealer ought not to have been so registered, then not withstanding anything contained in this act, such person shall be liable to pay tax for the period commencing from the date of his registration and ending with the date of such order, as if he were a dealer. -23- 9. Levy of tax on sale: (1) The tax payable by a dealer liable to pay tax under section 8 shall be levied on his taxable turnover of sales. (2) Taxable turnover of sales in relation to a dealer liable to pay tax on sale of goods under sub-section (1) of section 8 shall be the gross turnover of sales during any period which remains after deducting there from a. Sales of goods declared as exempt from tax in schedule-I b. Sales of goods, which are shown to the satisfaction of the Commissioner to have taken place- i. In the course of inter-state trade or commerce, or ii. Outside the State of Nagaland iii. In the course of the import of the goods into or export of the goods out of the territory of India. Explanation: Section, 3,4 and 5 of the Central Sales Tax Act, 1956 shall apply for determining whether or not a particular sale or purchase has taken place in the manner indicated in sub-clause (i), sub-clause (ii), or sub-clause (iii) c. Such other sales on such condition and restriction as may be prescribed. 10. Levy of tax on purchase: Every dealer who in the course of his business purchases any goods: a. From a registered dealer in the circumstances in which no tax under section 9 is payable by that registered dealer on the sale price of such goods, or b. From any other person, shall be liable to pay tax on the purchase price of such goods, if after such purchase, the goods are not sold within the sate of Nagaland or in the course of inter-state trade and commerce or in the course of export out of the territory of India, but are: (a) Sold or disposed of otherwise, or (b) Consumed or used in the manufacture of goods declared to be exempt from tax under this Act, or (c) After their use or consumption in the manufacture of goods, such manufactured goods are disposed of otherwise than by way of sale in the State of Nagaland or in the course of inter-State trade and commerce or export out of the territory of India, or (d) Used or consumed otherwise, and such tax shall be levied at the same rate at which tax under Section 9 would have been levied on the sale of such goods within the state on the sate of such purchase. -24- 11. Levy of taxes on constrainers and packing materials: Where any goods packed in any container or packing material in which such goods are packed shall be deemed to have been sold or purchased along with the goods and the tax under Section 9 or Section 10 shall be levied on the sale or purchase on such container or packing materials at the rate of tax, if any, applicable to the sale or, as the case may be, the purchase of the goods itself. Provided that no tax under Section 9 or Section 10 shall be levied where the container or packing material is sold or purchased along with the goods declared as exempt from tax under this Act. 12. Rate of tax: (1) The tax payable by a dealer under this Act shall be levied on the taxable turnover at such rate not below the floor rate subject to such conditions as the Government may from time to time impose. (2) The works contract of any nature whatsoever shall be levied tax on the gross value of the works contract subject to conditions as may be prescribed. (3) Every dealer who is required to be registered as specified and further subject to the conditions specified in this act, shall collect, account for and pay, on his taxable turnover relating to all taxable sales, tax at the rate as specified in the Schedules appended to this Act. (4) The tax payable by a dealer on the turnover of taxable sales as referred to in sub-section (1), shall be levied: (a) At the rate of zero per centum of such part of his turnover of sales as represents sales of any goods specified in schedule —II. (b) At the rate of one per centum of such part of his turnover of sales as represents sales of any goods specified in schedule —III. (c) At the rate of four per centum of such part of his turnover of sales as represents sales of any goods specified in scheduled-TV (d) At the rate of twelve and half per centum at single point of such part of his turnover of sales as represents sales of any goods specified in schedule-V (5) The rate of tax on works contract shall be at the rate of 4% or at such rate as may be notified by the State Government from time to time. (6) The State Government after giving in the official gazette such previous notice as may be considered reasonable of its intention to do, may, by like notification, add or armed or otherwise modify, any of the schedules and thereupon the schedules shall be deemed to be amended accordingly. -25- 13. Exemptions, zero-rate of tax and re-imbursement of tax in certain cases: (1) The sale of goods as specified in Schedule-I shall be exempt from tax under this Act subject to conditions and exceptions set out therein. (2) The State Government after giving in the official gazette such previous notice as may be considered reasonable of its intention to do, may, by like notification, add to, amend or otherwise modify, the said schedule and there upon the said schedule shall be deemed to be amended accordingly. (3) Zero-rate of tax in certain cases: When calculating the output tax in relation to the following cases of dealers, the rate of tax shall be Zero rated: (i) Export from India, i.e, the tax applicable to the exported commodities would be zero and credit/refund would be available for VAT paid on inputs going into such exports. (ii) Sales from Domestic Tariff Area to Special Economic Zones would be eligible for the same treatment as in sub-section (1) of this Section. (iii) Exports of export oriented Units and EHTP/STP Units would be taxed at zero (0%) supplies from DTA to such units would be zero- rated and the supplying unit would get credit/refund for VAT paid on inputs used by them. (iv) Sales from SEZ Units and units under FTZ's would be exempt from levy of VAT. (v) Goods and services provided by EPZ/EPIP would be taxed at zero %. (4) Reimbursement of tax in certain cases: Tax collected under this act on official and personal purchases made by foreign diplomatic missions and their diplomats as well as United Nation and its organization including other International Organization and their diplomats shall be re-imbursed in such manner and subject to such conditions as may be prescribed. 14. Output tax: (1) Output tax in relation to a registered dealer means the tax payable under: this Act in respect of any sale of goods by that dealer in the course of this business. (2) Subject to the provision of Section 17, a dealer shall be liable to pay the output tax under this Act which shall be levied on the taxable turnover at -26- the rate and subject to such conditions as may be prescribed from time to time. 15. Input tax: Input tax in relation to a registered dealer means the tax charged under this act by the selling dealer to such dealer on the sale to him of any goods for resale or use in manufacturing or processing of goods for sale butshall not include tax paid in respect of goods specified in Schedule VI used or disposed of in the circumstances mentioned against such goods: Provided that where the goods purchased in the State are used or disposed of partly in the circumstances mentioned in Schedule-TV and partly otherwise, the input tax in respect of such goods shall be computed pro rate: Provided further that if input tax in respect of any goods purchased in the State has been availed of but such goods are subsequently used or disposed of in the circumstances mentioned in Schedule —VI, the input tax in respect of such goods shall be reversed. 16. Net tax payable: (1) The net tax payable by a registered dealer for a tax period shall be the difference between the output tax plus purchase tax, if any, and the input tax, which can be determined from the following formula: Net tax payable = (O+P)-I Where '0' denotes the output tax payable for any tax period as determined under Section 14, 'P' denotes the purchase under section 10 and 'I' denotes the input tax paid or payable for the said tax period as determined under Section 15. (2) The net tax payable by a dealer liable to pay tax but not registered under this act for a tax period as determined under Section 14. (3) If the amount calculated under sub-section (1) is a negative quantum: (a) The same shall be adjusted against the tax liability, if any, under the Central Sales Tax Act, 1956 at the option of the dealer for the said tax period and only the remaining amount of the Central Sales Tax shall be payable; or (b) Any amount of credit remaining after such adjustment shall be carried forward to the next tax period. 17. Input tax credit: (1) Subject to the provisions of this Act for the purpose of calculating the net tax payable by a registered dealer for any tax period after being registered, -27- an input tax credit as determined under this section shall be allowed to such registered dealer for the tax paid or payable in respect of all taxable sales or any other sales or purchases as may be prescribed, under Section 10 during that period. (2) The input tax credit to which the registered dealer is entitled to shall be the amount of tax paid by the registered dealer to the seller, on his turnover of purchases made during the tax period, intended to be used for the purposes and subject to the conditions as specified in sub-section (3), sub-section (4) and sub-section (5) and calculated in such manner as may be prescribed. (3) Subject to such conditions and restriction as may be prescribed, partial input tax credit may be allowed in such cases as may be notified by the Government. (4) Input tax credit shall be allowed for purchase of goods made within the State of Nagaland from a registered dealer holding a valid certificate of registration and which are intended for the purpose of: (a) Sale or resale by him in the State of Nagaland; or (b) Used as raw material or as capital goods in the manufacturing and processing of goods other than those exempt from tax under this act intended for sale in the state of Nagaland; or (c) Sale in the course of export out of the territory of India; or (d) Sale in the course of inter-state trade or commerce under the CST Act, 1956 in full paid or payable; or (e) Goods used for transfer of stocks other than by way of sale outside the State of Nagaland in respect of input tax credit paid in excess of four percent; (0 Use as raw materials in manufacture or processing of goods where the finished products are dispatched outside the State of Nagaland other than by way of sales in respect of tax paid in excess of four percent on the raw materials used directly in the manufacture of finished products; or (g) For use as containers for packing of goods other than those exempt from tax under this Act for sale or resale in the State of Nagaland. Provided that if purchases are used partially for the purposes specified in this sub-section, input tax credit shall be allowed proportionate to the extend they are used for the purposes specified in this sub-section. (5) Input tax credit on capital goods be limited to plant and machinery directly connected with the manufacturing or processing of the finished products and input credit as admissible under this Section shall commence from -28- the date of commencement of commercial production and shall be adjusted against tax payable on output over a period of three years. Provided that in case of closure of business before the period specified above, no further input tax credit shall be allowed and input tax credit carried forward, if any, shall be forfeited. (6) Input tax credit shall not be claimed by the dealer until the tax period in which the dealer receives the tax invoice in original containing the prescribed particulars of the sale evidencing the amount of input tax: Provided that for good and sufficient reasons to be recorded in writing and in the prescribed manner the Commissioner may allow such credit subject to such conditions and restriction as may be specified. (7) A registered dealer who intends to claim input tax under sub-section (1) shall, for the purpose of determining the amount of input tax credit, nintain accounts, and such other records as may be State of Nagaland. (8) No input tax credit under sub-section (1) shall be claimed or be allowed to a registered dealer: (i) In respect of any taxable goods under this act purchased by him from another registered dealer for resole but given away by way of free sample or gift; (ii) Who has been permitted by the Commissioner to make payment of presumptive tax at a percentage of the turnover of sales in lieu of tax as provided under Section 21; (iii) In respect of capital goods other than those directly used for manufacturing or processing of goods for sale; (iv) In respect of goods brought from outside the State against the tax paid in other States; (v) In respect of stock of goods remaining unsold at the time of closure of business; (vi) In respect of goods purchased on payment of tax, if such goods are not sold because of any theft; (vii) where the tax invoice is: (a) Not available with the dealer, or (b) There is evidence that the same has not been issued by the selling dealer from whom the goods are purported to have been purchased; (viii) In respect of goods purchased from a dealer whose certificate of registration has been suspended; (ix) In respect of purchases of the following taxable goods: -29-. (a) Air conditioning units, air coolers, fans and air circulators unless the registered dealer is in the business of dealing in such goods; (b) All automobiles including commercial vehicles, two and three wheelers and spare parts for repairs and maintenance thereof, unless the registered dealer is in the business of dealing in such automobiles or spare parts; (c) Crude oil unless the registered dealer is in the business of dealing in such products; (d) Food, beverages, and tobacco products, unless registered dealer is in the business of providing such food, beverages and tobacco products; (e) Goods purchased and accounted for in business but utilized for the purpose of providing facility to the employees including any residential accommodation; and (f) Such good or classes of goods as specified in schedule-Vu, (x) In respect of sales exempt from tax as specified in schedule-I; (9) If goods purchased are intended for use specified under sub-section (4) or loss of goods arising out of theft or destruction for any reason or the stock of goods arising out of theft or destruction for any reason or the stock of goods remaining unsold at the time of closure of business and are subsequently used, fully or partly, for purposes other than those specified under the said sub-section, the input tax credit availed at the time of such purchase shall be reduced from the tax credit for the period during which the said utilization has taken place: Provided that if part of the goods purchased are utilized otherwise, the amount of reverse tax credit shall be proportionately calculated in a manner that is just and reasonable. (10) The methods that are used by a registered dealer in a year to determine the extent to which goods are used, consumed or supplied or intended to be used, consumed or supplies, in the course of making taxable sales be fair and reasonable in the circumstances. The Commissioner may, after giving sufficient reason in writing, reject the method adopted by the registered dealer and calculate the amount of input tax credit after giving the registered dealer concerned an opportunity of being heard. 18. Input tax credit exceeding tax liability: (1) If the input tax credit of a registered dealer other than an exporter selling goods outside the territory of India determined under Section 17 of this Act for a period exceeds the tax liability for that period, the -30- excess credit shall be set off against any outstanding tax, penalty or interest under this act. (2) The excess input tax credit after adjustment under sub-section (1) may be carried over as an input tax credit to the subsequent period or periods. Provided that the input tax credit shall not be carried forward for a period of more than two years after close of the concerned financial year. Unadjusted input tax credit beyond two years shall have to be refunded. (3) In case where input tax credit is carried forward, a quarterly credit statement may be forwarded to the dealer concerned and the claims reconciled accordingly. (4) Declaration of stock of goods held on the appointed day-In case of dealer registered under this Act with effect from the appointed day all tax paid goods purchased on or after April Pt 2004 and remaining still in the stock as on April 1st, 2005 will be eligible to receive input tax credit, subject to submission of required particulars and documents on inventory. VAT will be levied on the goods when sold on or after april I st, 2005 and input tax credit will be given for the sales tax already paid under the earlier laws in the previous years. Such tax credit will be available over a period of six months after an interval of three months needed for verification as may be prescribed. 19. Adjustment of input tax credit: Where any purchaser, being a registered dealer, has been issued with a credit note or debit note in terms of sub-section (1) of section 23 or if he returns or rejects goods purchased, as a consequence of which, thee input tax credit availed by him in any period in respect of which the purchase of goods relates, becomes less or excess, he shall compensate such less credit or excess credit by adjusting the amount of tax credit allowed to him in respect of the tax period in which the credit note or debit note has been issued or goods are returned subject to conditions as may be prescribed. 20. Burden of proof: In respect of any sale or purchase affected by a dealer the burden of proving that he is not liable to pay tax under Section 9, Section 10 or that he is eligible to input tax credit under Section 17 shall be on him. 21. Levy of presumption tax on registered retailers: All registered retailers whose gross turnover of sales does not exceed rupees ten lakhs, subject to such conditions and restrictions as may be prescribed shall, pay in lieu of the tax as specified under Sections 9 or Section 10, a tax at such percentage of the entire taxable turnover of such sales and purchase as the -31- government may, by order, notify, subject to the condition that no input tax credit shall be available to such dealers: Provided that payment of tax under this Section shall not apply to a registered retail dealers who imports goods from-outside the state for the purpose of carrying out his business. Provided further that a registered retail dealer may, by exercising option in the prescribed manner, elect to pay tax as specified under Section 9 or Section 10 of this Act in lieu of the provisions of this section. 22. Powers of Government to amend schedules: The Government after giving by notification not less than 14 days notice of the intention to do so, may, by like notification, add to amend or alter any schedule to this Act. 23. Credit notes and debit notes: (1) Where a tax invoice has been issued and the amount shown as tax charged in the tax invoice exceeds the tax payable under this act in respect of that sale, the registered dealer making the sale shall provide the purchaser with a credit note containing the requisite particulars as may be prescribed. (2) Where the tax invoice has been issued and the tax payable under this Act in respect of the sales exceeds the amount of tax charged in that tax invoices, the registered dealer making the sale shall provide the purchaser with a debit note containing the requisite particulars as may be prescribed. (3) In case of goods returned or rejected by the purchaser,, a credit note shall be issued by the selling dealer to the purchaser and a debit note will be issued by the purchaser to the selling dealer containing the particulars as mmay be prescribed. CHAPTER -IV REGISTRATION OF DEALERS, AMENDMENT AND CANCELLATION OF REGISTRATION CERTIFICATES 24. Compulsory registration of dealers: (1) No dealer shall, while being liable to pay tax, carry on business as a dealer unless he has been registered and possesses a certificate of registration: Provided that a dealer liable to pay shall be allowed one month time from the state from which he is first liable to pay such tax to get himself registered. -32- (2) Every dealer required by sub-section (1) to be registered shall make application in this behalf in the prescribed manner to the prescribed authority and such application shall be accompanied to the prescribed authority and such application shall be accompanied by a declaration in the prescribed form duly filled in and signed by the dealer specifying therein the class or classes of goods dealt in or manufactured by him. (3) If the said authority is satisfied that an application for registration is in order, he may, in accordance with such manner, grant registration to the applicant and issue a certificate of registration in the prescribed form which shall specify the class or classes of goods dealt in or manufactured by him. Provided that the registering authority shall not grant registration unless and until the dealer furnishes all particulars pertaining to the businesses of the dealer as may be prescribed. (4) W
Excerpt shown. Open the full act in Lexace.