The TRIPURA VALUE ADDED TAX ACT, 2004

i  
 
 
 
 
 
TRIPURA ACT No. 1 of 2005. 
 
 
 
 
 
THE TRIPURA VALUE 
ADDED TAX ACT, 2004 
AND 
THE TRIPURA VALUE ADDED 
TAX RULES, 2005 
 
(As amended till 7th September, 2011) 

iii  
 
 
 
 
 
CONTENTS 
THE TRIPURA VALUE ADDEDTAX ACT, 2004. 
 
Sections Page 
Chapter -I 
(PRELIMINARY) 
1. Short title, Extent and Commencement 1 
2. Definitions 1 
Chapter-ll 
(Incidence and levy of tax ) 
3. Incidence of Tax 10 
4. Tax on deemed sales 12 
5. Levy of Tax on Sale 13 
6. Levy of Tax on containers and Packing material 14 
7. Rate of Tax 14 
8. Exemptions 14 
9. Tax payable 14 
10. Input tax credit 15 
11. Input tax credit exceeding tax liability 18 
12. Adjustment of input tax credit 18 
13. Export 19 
14. Burden of proof 19 
15. Composition of tax by certain registered dealers 19 
16. Powers of Government to amend Schedule 20 
17. Credit notes and Debit notes 20 
Chapter -III 
18. Taxing Authority and Tribunal 21 
Chapter -IV 
(REGISTRATION) 
19. Compulsory registration of dealers 23 
20. Security to be furnished in certain cases 25 
21. Imposition of penalty for failure to get registered 25 
iv  
 
 
 
 
 
Sections Page 
22. Registration of Transporters 26 
23. Quoting of Registration Certificate Number etc. 27 
Chapter-V 
(RETURNS & ASSESSMENT) 
24. Periodical returns and payment of tax 28 
25. Returns defaults 29 
26. Rounding off of the amount of tax, interest or penalty 30 
27. Scrutiny of returns 30 
28. Tax Audit 31 
29. Self assessment 31 
30. Provisional assessment 31 
31. Audit assessment 32 
32. Assessment of dealer who fails to get himself registered 34 
33. No assessment after five years 34 
34. Turnover escaping assessment 34 
35. Exclusion of time period for assessment 35 
36. Power of reassessment in certain cases 35 
 
Chapter-VI 
(PAYMENT AND RECOVERY OF TAX, PENALTY, INTEREST AND OTHER DUES) 
37. Payment and Recovery of Tax, Penalty and Interest 36 
38. Special mode of recovery 37 
39. Collection of tax only by registered dealers 38 
40. Collection of excess tax and forfeiture of such excess tax 39 
41. Purchase or Sales not liable to tax 40 
42. Tax to be first charge on property 40 
43. Refund 40 
44. Provisional refund 41 
45. Interest 41 
46. Power to withhold refund in certain cases 42 
47. Exemption of certain sales and purchases 43 
v  
 
 
 
 
 
Sections Page 
Chapter -VII 
(ACCOUNTS AND RECORDS) 
48. Maintenance of accounts and records etc. 44 
49. Accounts to be Maintained by Carriers 44 
50. Tax invoice 45 
51. Electronic record 48 
52. Requirement to provide information 48 
53. Audit of accounts 48 
54. Dealer to declare the name of his business manager 49 
Chapter -VIII 
( LIABILITY IN SPECIAL CASES ) 
55. Liability to pay tax in case of death 50 
56. Certain agents liable to tax for sales on behalf of principal 51 
57. Liability of Partners 52 
58 Amalgamation of companies 52 
Chapter -IX 
(INSPECTION OF ACCOUNTS, DOCUMENTS AND SEARCH OF PREMISES) 
59. Production and inspection of accounts and documents and 
search of premises 
 
54 
60. Survey 55 
61. Automation 56 
62. Power to collect statistics 56 
63. Disclosure for information by a public servant 57 
64. Disclosure of information required under section 62 and failure to 
furnish information or return under that section 
 
59 
65. Publication and disclosure of information in respect of dealers 
and other persons in public interest 
 
60 
Chapter -X 
( DETECTION AND PREVENTION OF TAX EVASION ) 
66. Restriction on movement 61 
67. Establishment of check posts for inspection of goods in transport 61 
68. Disposal of Seized goods 63 
vi  
 
 
 
 
 
Sections Page 
Chapter -XI 
(APPEALS AND REVISION) 
69. Appeal 65 
70. Revision by Commissioner 66 
71. Appeal to the Tribunal 67 
72. Revision to High Court 68 
73. Hearing of Revision and Review by the High Court 68 
74. Power to Rectify Error Apparent on the Record 68 
Chapter -XII 
(OFFENCES AND PENALTIES) 
75. Offences and penalties 69 
76. Offences by companies 72 
77. Penalty payable by the transporters 73 
78. Cognizance of offences 74 
79. Investigation of offences 74 
80. Compounding of offences 74 
Chapter -XIII 
(MISCELLANEOUS) 
81. Appearance before any authority in proceedings 76 
82. Power to take evidence or oath etc. 77 
83. Declaration of stock of goods held on the appointed day 77 
84. Bar of suits in Civil Courts and indemnity 77 
85. Delegation of Powers 78 
86. Power to remove difficulties 78 
87. Power to Make Rules 78 
Chapter -XIV 
(TRANSITION, REPEAL AND SAVINGS) 
88. Transition 80 
89. Repeal and Savings 83 
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THE TRIPURA VALUE ADDED TAX RULES, 2005 
 
Rules Page 
1. Short title and Commencement 131 
2. Definitions 131 
3. Liability to pay tax 133 
4. Input Tax Credit on purchase of inputs used for production of taxable goods 134 
5. Claim of Input Tax cedit on purchase of taxable goods 135 
6. Input tax credit 136 
7. Deduction of Tax at source 139 
8. Authorities to assist the Commissioner 140 
9. Tribunal 141 
10. Registration of Dealers 142 
11. Information in regard to submitting application for registration 142 
12. Certificate of Registration 144 
13. Display of Registration certificate 145 
14. Treatment and replacement of registration certificate issued earlier under 
the Tripura Sales Tax Act, 1976 or The Tripura Purchase Tax Act, 1990. 
 
145 
15. Display of Signboard 147 
16. Information in respect of changes requiring amendment of 
certificate of registration 
 
148 
17. Registration of Transporter, Carrier or Transporting agent 150 
18. Returns 152 
19. Deduction of sale price of goods returned etc. 154 
20. Manner and payment of tax 154 
21. Notice for assessment & imposition of penalty, preservation of assessment 
records etc. 
 
155 
22. Appeal 156 
23. Memorandum of appeal and manner of submission of Memorandum of Appeal 156 
24. Revision 158 
25. Rejection of Revision petition 158 
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Rules Page 
26. Fixing of date & place for hearing of revision petition 158 
27. Notice of Demand 158 
28. Mode of Payment 158 
29. Notice under Section 38(1) 158 
30. Charging of interest 158 
31. Form of Tax payment challan 159 
32. Tax payment challan in qua-duplicate 159 
33. Function of Treasury 159 
34. Maintenance of daily collection and assessment register 159 
35. Refunds 159 
36. Manner of claiming refund 160 
37. Issue of refund voucher 161 
38. Maintenance of register of refund 161 
39. Prosecution 161 
40-41 Payment of composition money 162 
42. Maintenance of books & accounts by dealers 162 
43. Requirement of keeping cash memo or bill, tax invoice, purchase 
voucher during transpostation 
 
163 
44. Requiring production of Accounts without reasonably affecting business 
of the dealer 
 
163 
45. Selection of dealers for audit 164 
46. Manner of services of Notices 165 
47. Declaration of taxable goods with restriction thereof 166 
48. Submission of Form XXIV for permit 166 
49. Declaration of transportation / Carrier in form XXV 166 
50. Restriction of issue of form XXV 168 
51. Issue of permit in form XXIV 168 
52. Issue of permit in form XXVI 169 
53. Information in regard to loss or theft or destruction of Form XXV or XXVI 171 
54. Restriction on issue of Form XXVI 171 
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Rules Page 
55. Issue of permit in Form XXVII 172 
56. Authorisation to take delivery of or transport any consignment of 
taxable goods 
 
172 
57-58. Delegation and Exercise of Power 172 
59 Fees 172 
60-61. Supplies of Copies 173 
62. Manner of Submission of application for certified copies 173 
63. Fees payable for certified copies 173 
64. Place of assessment 174 
65. Claiming of deduction on the ground that taxable goods are not sold 
in the State 
 
174 
66. Display of Registration certificate in conspicuous place 174 
67-68. Rounding of turnovers 174 
69. Checkpost 174 
70. Inspection and search of vehicles and boats 175 
71. Power to search at any place by officer-in-charge of a checkpost, 
Superintendent of Taxes or any officers specially empowered by the 
Commissioner of Taxes 
 
 
176 
72. Cost of loading and unloading for search and seizure to be borne 
by the dealer / person / transporter 
 
177 
73. Verification of declaration 178 
74. Survey 178 
75. Power of the Commissioner of Taxes 178 
1  
CHAPTER - I 
 
 
 
 
 
Tripura ACT NO.l of 2005 
 
THE TRIPURA VALUE ADDED TAX ACT, 2004 
 
An Act to provide for the le vy and collection of value added tax at different  
points of sale in the State of Tripura. Be it enacted by the Tripura Legislative  
Assembly in the fifty fifth year of the Republic of India as follows :- 
 
 
 
PRELIMINARY 
1. Short Title, Extent and Commencement - (1) This Act may be called the 
Tripura Value Added Tax Act, 2004. 
(2) It extends to the whole of the State of Tripura. 
(3) It shall come into force on such date as the State Government may,  
by notification in Official Gazette, appoint. 
2. Definitions - In this Act, unless the context otherwise specifies, 
(1) „Act‟ means the Tripura Value Added Tax Act, 2004. 
(2)  “Assessee” means any person by whom tax or any other 
sum of money is payable under this Act and includes every person in 
respect of whom any proceeding under this Act has been taken for 
the assessment of tax payable by him; 
(3) „Assessing Authority‟ means an officer of the Finance (Excise &  
Taxation) Department, authorised to make any assessment under the 
Act. 
(4) „Business‟ includes: 
(a) any trade, commerce or manufacture or any adventure or 
concern in the nature of trade, commerce or manufacture 
whether or not such trade, commerce or manufacture, adventure 
or concern is carried on with a motive to making gain or profit 
and whether or not any profit accrues from such trade,  
commerce, manufacture, adventure or concern; and 
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(b) any transaction in connection with, or incidental or ancillary  
to, such trade, commerce, manufacture, adventure or concern. 
(5) „ Capital goods‟ means plant, machinery and equipment used in the  
process of manufacturing. 
(6) „Casual traders‟ means a person who, whether as principal, agent or  
in any other capacity, carries on occasional transaction of a business 
nature involving the buying, selling, supplying or distribution of goods 
in the State, whether for cash o r for deferred payment or for com - 
mission, remuneration or other valuable consideration. 
(7) „Commissioner‟ means any person appointed by the State  
Government to be a Commissioner of Taxes. 
(8) „Dealer‟ means any person who carries on the business of buying,  
selling, supplying for commission, remuneration or other valuable  
consideration, and includes- 
(a) an industrial, commercial, banking, or trading undertaking 
whether or not of the Central Government or any of the State  
Governments or a local authority; 
(b) an advertising concern or agency; 
(c) a casual trader; 
(d) a company, firm, club, association, society, trust, or cooperative 
society, whether incorporated or un-incorporated, which carries 
on such business; 
(e) a commission agent, a broker, a del credere agent, any 
auctioneer o r any other mercantile agent by whatever name  
called, who carries on the business of buying, selling, supplying 
or distributing goods on behalf of any principal; 
(f) an agent of a non-resident dealer or a local branch of a firm or 
company or association situated outside the State; 
(g) a person who sells goods produced by him by manufacture or  
agriculture or otherwise; 
(h) a person engaged in the business of transfer otherwise than in  
pursuance of a contract of property in any goods or cash,  
deferred payment or other valuable consideration; 
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(i) a person engaged in the business of transfer of property in goods 
(whether as goods or in some other form) involved in the  
execution of a works contract; 
(j) a person engaged in the business of delivery of goods on hire  
purchase or any other system of payment by instalments; 
(k) a person engaged in the business of transfer of the right to use  
any goods for any purpose (whether or not for a specified  
period) for cash, deferred payment or commission or 
remuneration or any other valuable consideration; 
(1) a department of the Central Government or any State  
Government or a Local Authority by name of any Panchayat,  
Municipality, Development Authority, Cantonment Board or  
any autonomous or statutory body including a Port Trust and  
the like, which, whether or not in the course of business, buys, 
sells, supplies or istributes goods, directly or otherwise, for  
cash,  or for deferred  payment,  or for commission,  
remuneration, or other valuable consideration; 
(m) a Hindu Undivided Family or any other syst em of joint family  
which carries on business. 
(9)  „Document‟ means title deeds, writing or inscription and 
includes electronic data, computer programmes, computer tapes, 
computer discs and the like that furnishes evidence. 
(10) Goods‟ means all kinds of movable property (otherthan newspapers) 
and includes all materials, commodities, which are agreed to be  
severed before sale or purchase1 under a contract of sale or 
purchase2 and property in goods (whether as goods ibid purchase or  
in some other form) involved in th e execution of works contract,  
lease or hire-purchase or those to be used in the fitting out, 
improvement or repair of movable property but does not include  
actionable claims, stocks, shares and securities. 
(11) „Government‟ means the Government of Tripura. 
(12) „Gross turnover‟ means the aggregate turnover in all goods of a dealer 
 
1,2 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
4 
 
 
 
 
 
 
at all places of business in  the State for a particular period made on  
his own account and also on behalf of the principals. 
(13) “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 Tripura in the course of business for resale or for the  
manufacture of taxable goods or for use as containers or packing  
material or for the execution of works contract; 
(14) “Manufacture” includes any activity that brings out a change in an  
article or articles as a result of some p rocess, treatment, labour and  
results in transformations into a new and different article so 
understood in commercial parlance having a distinct name, character, 
use, but does not include such activity of manufacture as may be  
notified. 
(15) “Official Gazette” means the Tripura Gazette. 
(16)  “Output Tax” means the tax charged or chargeable under this 
Act by a registered dealer for the sale or purchase 1 of goods in the 
course of business in Tripura; 
(17) “Person” includes :- 
a) an individual; 
b) a joint family; 
c) a company; 
d) a firm; 
e) an association of persons of a body of individual; whether 
incorporated or not; 
f) the Central Government or the Government of Tripura or the 
Government of any other State or Union Territory in India; 
g) a local authority; 
(18) “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; 
1 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
5 
 
 
 
 
 
 
(b) any place where a dealer produces or manufactures goods; 
(c) any place where a dealer keeps his books of accounts; 
(d) in cases 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; 
(19) “Prescribed” means prescribed by rules made under this Act; 
(20) “Recipient” means a person receiving goods, as defined for the 
purpose of this Act; 
(21) “Registered Dealer” means a dealer registered under this Act; 
(22) “Resale” means sale of purchased goods - 
(i) 1 (a) in the same form in which they were purchased; or 
(b) without doing anything to them, which amounts, or results 
in a manufacture. 
(ii) ''Repurchase'' means purchase of sold goods — 
(a) in the same form in which they were sold, or 
(b) without doing anything to them, which amounts, or result 
in a manufacture.2 
(23)  “Return” means any return prescribed and / or required to be 
furnished under this Act or the Rules. 
(24) “Rules” means rules made under this Act. 
(25) (i)3 “Sale” with all its grammatical variations and cognate  
expressions means every transfer of the property in goods  
(other than by way of a mortgage, hypothecation, charge or  
pledge ) by one person to another in the course of trade or  
business for cash or f or deferred payment or other valuable  
consideration, and includes - 
a) transfer otherwise than in pursuance of a contract of 
property in any goods for cash, deferred payment or other 
valuable consideration; 
1,3 Renumbered vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent 
legislation vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
2 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
1,2 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
6 
 
 
 
 
 
 
b) transfer of property in goods (whether as goods or in some 
other form) involved in execution of a works contract; 
c) delivery of any goods on hire purchase or any other system 
of payment by instalments; 
d) transfer of the right to use any goods for any purpose  
(whether or not for a specified period) for cash, d eferred 
payment or 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. 
(ii) 'Purchase' with all its grammatical variations and cognate  
expressions means any transaction of acquiring property in  
goods against valuable consideration or deferred payment 
by a dealer on purchase of taxable goods as mentioned in  
schedule VIII including any sum charged for, 
(a) anything done by the seller with or in respect of the goods 
at the time of or before delivery thereof and 
(b) containers or other material s for the packaging of such  
goods.1 
(26) “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 trade, but inclusive of any sum charged for anything 
done by the dealer in respect of the goods or services at the time of  
or before delivery there of, excise duty, special excise duty or any  
other duty or taxes except the tax imposed under this Act "and 
'purchase price' means the amount of valuable consideration paid  
or payable by a dealer on purchase of taxable goods as mentioned  
in schedule VIII." 2 
 
2, 3 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
7 
 
 
 
 
 
 
Explanation 11 :- 
For the purpose of this clause „sale price‟ includes, - 
a) in relation to the transfer of prop erty in goods (whether as  
goods or in some other form) involved in the execution of  
works contract, such amount as is arrived at by deducting from 
the amount of valuable consideration paid or payable to a person 
for the execution of such works contract, the amount  
representing labour and other charge incurred and profit 
occurred not in connection with transfer of property in goods  
for such execution; 
b) in respect to transfer of the right to use any goods for any  
purpose (whether or not for a specified period) , the valuable  
consideration received or receivable for such transfer. 
Explanation 2 :- 
For the purpose of this clause purchase price includes,- 
(a) anything done by the seller with or in respect of the goods 
at the time of or before delivery thereof and 
(b) containers or other materials for the packing such 
goods; 2 
(27) “Schedule” means schedule appended to this Act; 
(28) “Tax” means the tax payable under this Act, 
(29) “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; 
(30) “Tax Period” means a calendar month or a quarter, as the case may  
be, as prescribed; 
(31) “Taxable Sale” means sale which is taxable under t he provisions of 
this Act , "and ''Taxable purchase" means purchase of goods as  
mentioned in schedule VIII which is taxable under the provisions 
of this Act ;" 3 
1 Renumbered vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent 
legislation vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
8  
 
 
 
 
 
(32) “Taxable Turnover” means the turnover on which a dealer is liable to 
pay tax; 
(33) “Transporte” means a registered transport company, a carrier or a  
transporting agent operating transport business in Tripura in taxable 
goods. 
(34) “Tribunal” means the Tribunal constituted under this Act; 
(35) "'Turnover' means the aggregate amount for which goods are 
either purchased or bought or sold or supplied or distributed by 
a dealer, either directly or through another whether on own 
account or on account of other, whether for cash or for deferred  
payment, or other valuable consideration." 1 
Explanation :- 
(1) The turnover in respect of delivery of goods on hire purchase or on  
any system of paymeniby 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, 
(3) Subject to such conditions and restrictions, if any, as may be 
prescribed in this behalf, - 
(a) the amount for which goods are sold shall include any sum  
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 goods 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 later dealer but  
not in that of the former; 
(4) The turnover in respect of purchase of taxable goods means goods  
as mentioned in schedule VIII. 2 
1 Substituted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent 
legislation vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
2 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
9  
 
 
 
 
 
(36) “Works Contract” means any agreement for carrying out for cash or 
deferred payment or other valuable consideration - 
(i) the construction, fitting out, improvement or repair of any 
building, road, bridge or other immovable property, or 
(ii) the installation or repair of any machinery affixed to a building 
or other immovable property, or 
(iii) the overhaul or repair of- 
(a) any motor vehicle, 
(b) any vessel propelled by internal combustion engine or by  
any other mechanical means, 
(c) any aircraft, 
(d) any component or accessory or part of any of the items 
mentioned in paragraph (a) to (c) above, 
(iv) the altering, ornamenting, finishing, improving or otherwise 
processing or adopting of any goods. 
(37) “Year” means twelve-month period commencing on the fir st day of 
April; 
(38) “Zero rating” means complete removal of tax up to the zero rated  
stage of production or distribution. No tax is charged on sale and tax 
credit is given for the tax paid on purchases. 
(39) “Special Economic Zone” (S.E.Z) means the area outside the custom 
territory of India for trade operation, duties and tariffs. 
10  
 
 
 
 
 
 
 
INCIDENCE AND LEVY OF TAX 
 
3. Incidence of Tax – (l) Every dealer – 
(a) at the time of commencement of this Act – 
(i) whose taxable turnover of sales during the year immediately 
preceding the commencement of this Act exceeded the taxable 
limit, or 
(ii) who is registered or liable to be registered under the Tripura  
Sales Tax Act, 1976 or the Central Sales Tax Act, 1956, or 
Tripura Purchase Tax Act, 1990, or1 
(iii) who is engaged in purchase of taxable goods as mentioned 
in schedule VIII. 2 
(b) to whom clause (a) does not apply, and 
(i) whose taxable turnover first exceeds the taxable limit during  
any period of twelve consecutive months, or 
(ii) who is registered as a dealer under the Centr al Sales Tax Act, 
1956, shall be liable to pay Value Added Tax (VAT) in accordance 
with the provisions of this Act. 
Provided that the State Government may keep certain goods as 
listed in the schedule II (d) outside VAT which will be taxable 
in the first point of sale within the State without any tax credit  
at such rates as may be specified by the Government from time 
to time by notification in the Official Gazette. 
Provided further that the rates of different items may be 
different. 
(2) Every dealer is liable to pay tax under sub-section (1) on sales 
 
1,2 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
CHAPTER -II 
11 
 
 
 
 
 
 
effected by him, 
(a) in case of sub-clause (i) & (iii) of 1 clause (a) of sub -section 
(1), with effect from the date of commencement of this Act; 
(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 taxable turnover first exceeded the taxa ble limit during a  
period of any twelve consecutive months, 
(c) in case of sub -clause (i) and (ii) 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. 
(d) in case of sub -clause (iii) of clause of sub -section (1) with  
effect from the date as notified in the official Gazette or from  
the registration, the date on which he becomes so liable 
whichever is earlier. 2 
(3) For the purpose of this Act, taxable limit means in relation to any dealer 
who: 
(a) imports for sale any taxable goods into the 
State of Tripura on his own behalf or on 
behalf of his principal - Nil 
(b) manufactures or processes any taxable goods 
for sale - Nil 
(c) is engaged in any other business other than 
clause (a) and (b) -   Rs.3,00,000/- 
(d) involved in the execution of works contract 
and transfer of right to use any goods for any 
purpose, lease or hire purchase - Nil 
1,2 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
1 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
12 
 
 
 
 
 
 
(e) involved in purchase of goods as mentioned 
in the schedule VIII - Nil 1 
4. Tax on deemed sales - (1) Notwithstanding anything contained elsewhere 
in this Act, any transfer of property in goods (whether as goods or in some 
other form) involved in the execution of a works contract shall be deemed 
to be a sale of those goods by the person making the transfer and shall  
liable to be taxed at the rate specified in the Schedule: 
Provided that in respect of any such transfer, o nly so much value of the  
goods involved in the works contract which has actually been paid to the  
dealer during the period, shall be taken into account for determining the  
turnover for the period. 
Explanation :- For the purpose of this section, “Property i n goods” shall 
mean the aggregate of the goods for which amounts have been received or 
receivable by a dealer during such period as valuable consideration, whether 
or not such amount has been separately shown in the works contract. The  
amount as received o r receivable shall include the value of such goods  
purchased, manufactured, processed, or procured otherwise by the dealer, 
and the cost of freight or delivery as may be incurred by such dealer for  
carrying such goods to the place where these are used in e xecution of  
such works contract, but shall not include such portion of the aforesaid  
amounts as may be prescribed. 
(2) Tax on transfer of the right to use any goods - Notwithstanding 
anything contained elsewhere in this Act, any transfer of the right to 
use any goods for any purpose (whether or not for a specified period) 
shall be taxable at the rate as specified in the Schedule. 
(3) Deduction of tax at the time of payment - Every person responsible  
for paying ) any sum to any person on account of works contract and 
right to use any goods for any purpose, shall at the time of credit of  
such sum to account of the person or at the time of payment thereof  
in cash or by issue of a cheque or draft or any other mode, deduct  
such amount towards sales tax (not being more than  the total tax  
payable by the dealer) as may be prescribed. 
1 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
13 
 
 
 
 
 
 
5. Levy of tax on sale - (1) The tax payable by a dealer under section 3 shall 
be levied on his taxable turnover of sales. 
(2) Taxable turnover of sales in relation to a dealer liable to pay tax under 
sub-section (1) of section 3 shall be calculated from 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 „III‟; 
(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 Tripura. 
(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) orsub-clause (iii). 
(c) in case of turnover of sales in relation to works contract, the charges 
towards labour, services and other like charges and subject to such  
conditions as may be prescribed; 
Provided that in cases where the amount of charges towards labour,  
services and other like charges in such contract are not ascertainable 
from the terms and conditions of the contract, the amount of such  
charges shall be calculated at the prescribed percentage. 
(d) such other sales on such conditions and restrictions as may be 
prescribed. 
5A. Levy of Tax on purchase - (1) The tax payable by a dealer und er Section 
3(1) (a) (iii) shall be levied on his gross taxable purchase. 
(2) The tax under sub -section (1) shall be levied at the gross taxable  
purchase of goods as mentioned in schedule VIII. 1 
legislation vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
14 
 
 
 
 
 
 
6.  Levy of tax on containers and packing material. -Where any 
goods packed in any container or packing material are sold or purchased1 
in which such goods containers and packing materials are packed shall be 
deemed to have been sold or purchased2 along with the goods and the Tax 
under Section 5 or 5A 3 shall be l evied on the sale or purchase 4 of such 
container or packing material at the rate of tax, if any, applicable to the  
sale, of the goods itself; 
Provided that no tax under section 5 shall be levied where the container or 
packing material is sold along with th e goods declared as exempted from  
tax under this Act. 
7.  Rate of tax – The value added tax payable by a dealer under this 
Act shall be levied on his taxable turnover at such rate as specified in the  
Schedule II(a), II(b), II(c), VI, VII & VIII.5 
8. Exemptions :- (1) Sale of certain goods as specified in the Schedule III 
of this Act shall be exempt from tax under this Act subject to conditions  
and exceptions set out therein. 
(2) Sales of certain goods of local importance with little implication on  
interstate trade as  specified in Schedule IV shall be taxable at the  
rate zero. 
(3) Export of Export Oriented Units and Special Economic Zone would 
be exempt from tax under this Act. 
(4) Supplies between Special Economic Zone and Export Oriented Units 
would be exempt from tax under this Act. 
9. Tax payable : - (1) The net tax payable by a registered dealer for a tax  
period shall be difference between the output tax and the input tax, which  
can be determined from the following formula: 
Net tax payable = O – I 
Where „O‟ denotes the output tax payable for any tax period on the taxable 
turnover at the rates specified in the Schedule and subject to such 
conditions as may be prescribed from time to time and „I‟ denotes the  
input tax paid or payable under this Act for the said tax period by such 
 
1, 2, 3, 4 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent 
legislation vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
5 Substituted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent 
legislation vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
15 
 
 
 
 
 
 
dealer to another registered dealer on the sale to him of any goods for  
resale or use in manufacturing or processing of goods for sale or purchase 
by him of goods mentioned in schedule VIII for resale or use in 
manufacturing or processing of goods for sa le 'or purchase by him of  
goods mentioned in schedule VIII for resale or use in manufacturing or  
processing of goods for sale.'1 
Explanation – Value Added Tax (VAT) is a multi point tax payable by  
manufacturer, processor, wholeseller and retailer on the va lue added on  
each point of sale with provision for credit of tax paid during purchase  
'and also on each point of purchase of goods as mentioned in schedule  
VIII with provision for credit of tax paid during previous transaction.'2 
10. Input tax credit :- (1) For the purpose of calculating the net tax payable  
by a registered dealer for any tax period after being registered, 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 
purchase of goods as mentioned in schedule VIII and 3 all taxable sales  
other than such sales as may be prescribed subject to the following 
conditions: 
(a) Input tax credit on capital gods except those mentioned in negative  
list in Schedule IV shall be  adjusted against tax payable by a dealer  
over a period not exceeding 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. 
(b) In respect of exporting dealers, input tax credit may be spread over a 
period less than 3 years as may be prescribed. 
(c) Input tax credit is to be given only after commencement of sale of  
taxable goods 'and purchase of taxable goods as mentioned in 
shedule VIII.'4 
(d) In respect of inputs used in taxable goods sent on stock / consignment 
transfer, tax paid in excess of 4% or the prevailing rate of C. S. T. on 
such inputs is to be credited. 
 
 
1, 2, 3, 4 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent 
16  
 
 
 
 
 
(e) Tax paid in excess of 4% on petroleum products used as fuel (other  
than petrol, Aviation Turbine Fuel and diesel and other fuels when  
used as fuel in production of taxable goods or captive power is to be 
entitled for input credit. However, no input tax credit will be given if 
petroleum product is used as fuel in motor vehicle. 
(f) Input tax credit shall be allowed during the return period. Refund of 
excess tax credit shall be allowed only after the end of the fina ncial 
year. 
(2) Partial input tax credit is to be made where inputs are used in  
the following circumstances :- 
(a) Where sale consists of both taxable and exempted goods. 
(b) Where sale consists of sale and dispatch in the form of 
consignment and stock transfer to other states. 
(c) Where inputs are used for any other purposes in addition 
to use in the course of business. 
Provided that input tax credit shall be proportionate to taxable  
sale out of total sales 'and also shall be proportionate to 
taxable purchase out of total purchase for the goods as 
mentioned in schedule VIII'1 
Provided further that in case of consignment transfer, so much 
of input tax credit shall be given as may be prescribed. 
(3) Input tax credit shall be allowed for purchase of goods made within  
the State of Tripura 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 Tripura; or 
(b)  use as raw material or as capital goods in the manufacturing  
and processing of good s other than those exempted from tax  
under this Act intended for sale in the State of Tripura; or 
(c) sale in the course of export out of the territory of India; or 
(d)  for use as containers for packing of goods other than 
those exempted from tax under this Act for sale or resale in the 
State of Tripura; 
Provided that if purchases are used partially for the purposes 
1 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
17  
 
 
 
 
 
specified in this sub -section, input tax credit shall be allowed  
proportionate to the extent they are used for the purposes  
specified in this sub-section. 
(4) Input tax credit shall not be claimed by the dealer until the tax period 
in which the dealer r eceives the tax invoice in original containing  
the prescribed particulars of the sale evidencing the amount of the  
input tax: 
Provided that for good and sufficient reasons to be recorded in writing 
and in the prescribed manner, the Commissioner may allow s uch 
credit subject to such conditions and restrictions as may be 
prescribed. 
(5) A registered dealer who intends to claim input tax credit under sub - 
section (1) shall, for the purpose of determining the amount of input 
tax credit, maintain accounts, and such other records as may be  
prescribed in respect of the purchases and sales made by him in the  
State of Tripura. 
(6) No input tax credit under sub -section (1) shall be claimed or be  
allowed to a registered dealer - 
(i) in respect of any taxable goodsunder this Act purchased by him from 
another registered dealer for resale but give; away by way of free  
sample or gift; 
(ii) who has been permitted by the Commissioner for composition of 
tax at a percentage of the turnover of sales in lieu of VAT as provided 
under section 15; 
(iii) in respect of capital goods of traders in the initial year i. e. the input  
tax credit on capital goods would be confined to manufacturers; 
(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, destruction or damage for any reason; 
(vii) where the tax invoice is - 
(a) not available with the dealer, or 
18  
 
 
 
 
 
(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 goods used for transfer of stock other than by way of 
sale outside the State of Tripura; 
(x) in respect of sales exempt from tax as specified in Schedule III. 
(xi) in respect of raw materials used in manufacture or processing of  
goods where the finished products are despatched other than by way 
of sales: 
Provided that in respect of transactions falling under item (ix), input 
tax credit may be allowed on the tax paid in excess of 4% on the raw 
materials used directly in the manufacture of the finished products. 
(7) The Commissioner may, after giving sufficient reasons in writing,  
reject the method adopted by the registered dealer in a year to  
determine the extent to which goods are used, consumed or supplied 
or intended to be used, consumed or supplied, in the course of making 
taxable sales and calculate the amount of input tax credit after giving 
the registered dealer concerned an opportunity of being heard. 
11. 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 10 of this Act for a period exceeds the  
output tax for that period, the excess credit shall be set off against any  
outstanding tax, penalty or interest under this Act or CST Act, 1956. 
(2) The exc ess input tax credit after adjustment under sub -section (1)  
may be carried over as an input tax credit to the subsequent period or 
periods but shall not be carried beyond the end of next financial year. 
12. 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 17 or if he returns or rejects goods purchased, as a  
consequence of which, the 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 
19  
 
 
 
 
 
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. 
13. Export :- (1) Export from India will be zero rated i.e. the tax applicable to 
the exported commodity would be zero and credit / refund would be  
available for VAT paid under this Act on input used by them. 
(2) Sale of goods to International Organisations specified in Schedule I  
and official and private purchases by the Diplomatic Missions /  
Consulates shall be deemed to be sale of goods in the course of  
export out of territory of India and shal l be entitled to zero rating as  
provided. 
(3) Supplies from domestic tariff area to Special Economic Zone and  
Export Oriented Units would be zero rated and the supplying units  
would get credit / refund for VAT paid on inputs used by them. 
14. Burden of proof :- In respect of any sale effected by a dealer, the burden 
of proving that he is entitled to deduction under sub-section (2) of section 
5 or that he is eligible to input tax credit under section 10 shall be on him, 
15. Composition of tax by certain registered deale rs :- (1) All registered  
dealers whose gross turnover of sales does not exceed rupees ten lakhs,  
subject to such conditions and restriction as may be prescribed shall, pay  
in lieu of the tax as specified under section 5, a tax at such percentage cf  
the entire taxable turnover of such sales and purchases as the Government 
may, by order, notify, subject to the condition that no input tax credit shall 
be available to such dealers and no tax invoice shall be issued by such  
dealers : 
Provided that payment of tax under this section shall not apply to a registered 
dealer who imports goods from outside the state or purchase of goods as  
mentioned in schedule VIII or 1 manufactures or processes goods within  
the state for the purpose of carrying out his business. 
Provided further that a registered dealer may, by exercising option in the  
prescribed manner, elect to pay tax as specified under section 5 of this  
Act in lieu of the provisions of this section. 
(2)     Notwithstanding anything contained anywhere in the Act, the 
1 Inserted vide the TVAT (Amendment) Ordinance, 2007 (w.e.f 17-7- 2007) and subsequent legislation 
vide the TVAT (Amendment) Act, 2007(dt. 9-10-2007) 
20  
 
 
 
 
 
Government may, by notification in the official Gazette, specify any 
dealer or class of dealers 

Excerpt shown. Open the full act in Lexace.

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