Notifications & Circulars

Delhi VAT – New Return specified for courier companies: By Notification No. F.3(628)/ Policy/VAT/2016/1424-36, dated 11-2-2016, issued under Section 27 of the Delhi Value Added Tax Act, 2004, all firms/companies engaged in the business of courier activities and having their offices functioning within the National Capital Territory of Delhi are required to furnish an online quarterly return of details of transactions of delivering goods having value more than Rs. 10,000 at the doorsteps of their clients, either individually or at the business places or offices, in the format Form CR-II subject to the following conditions:

  • Every such firm/company shall have to enroll itself by logging on to website of the Department. 
  • The return should be filed on quarterly basis in Form CR-II by 28th day of the month following the quarter to which the return pertains.
  • In case any discrepancy is noticed subsequently, the details furnished in Form CR-II can be revised up to the end of the quarter following the quarter to which the return pertains.

Lump-sum payment of tax by developers - Rajasthan VAT Rules amended: Rajasthan Government has, by Notification No. F.12(11) FD/Tax/2016-182 S.O. 251, dated 8-3-2016 (effective from 1-4-2016), amended Rajasthan Value Added Tax Rules, 2006. A new sub-rule (1A) has been inserted in Rule 17A which states that a developer or builder who as a works contractor, undertakes the construction of premises and transfers them along with goods and land or interest underlying the land in pursuance of an agreement, may opt for payment of tax in lump sum as per Section 5. An application in Form VAT-69A has to be filed electronically within thirty days from the commencement of the project and separate application has to be made for each project. An explanation has also been inserted in Rule 17A(1A) to explain “Commencement of Project”. 

Further, a new sub-rule (8A) has also been added in Rule 17A which states that a developer or builder shall not be allowed to opt out in respect of the project(s) for which an option has been exercised by him. However, the developer or builder who had opted for payment of tax in lump sum in lieu of tax prior to 1-4-2016, may opt-out upto 30-4-2016, otherwise, the certificate for payment of tax in lump sum issued earlier shall remain in force for the projects already undertaken by him.

Ratio Decidendi 

Electronic Survey Instruments – Classification of: The Supreme Court of India has held that Electronic Survey Instruments are correctly classifiable under Entry 14 of Part F of Schedule I to the erstwhile Tamil Nadu General Sales Tax Act, 1959 and not under Entry 50 of Part B of Schedule I of the Act. The two entries read as:

Entry 50 of Part B of Schedule I - Electronic systems, instruments, apparatus, appliances and other electronic goods (other than those specified elsewhere in the Schedule) but including electronic cash registering, indexing, card punching, franking, addressing machines, and computers of analog and digital varieties, one record units, word processor and other electronic goods and parts and accessories of all such goods.

Entry 14 of Part F of Schedule I - Binoculars, monoculars, opera glasses, other optical telescope, astronomical instruments, microscopes, binocular microscopes, magnifying glasses, diffraction apparatus and mountings there for including theodolite, survey instruments and optical lenses parts and accessories thereof.

The assessee had contended that on account of being ‘electronic’ survey instruments, the goods would get covered under Entry 50 of Part B and not under the specific Entry 14 of Part F. The Court however opined that the exclusion of electronic variety of goods mentioned under Entry 14 of Part F such as survey instruments was conspicuously missing, whereas, in Entries 10 to 13 which covered goods such as typewriters, teleprinters, tabulating, calculating machines and duplicating machines etc., a specific exclusion of electronic variety of those machines was made. It was held that in the absence of such exclusion of electronic variety of survey instruments from Entry 14, electronic survey instruments were covered under Entry 14 of Part-F of Schedule I, chargeable to tax at the higher rate. [Electro Optics (P) Ltd. v. State of Tamil Nadu - 2016-VIL-09-SC]

Asafoetida is not a mixture of spices – Classification of: Rajasthan High Court has held that Asafoetida (hing) is taxable at a lower rate of tax under Entry 82 and not at a higher rate of tax under Entry 184 of the notification issued under the Rajasthan Sales Tax Act, 1994. The two entries read as:

Entry 82 - Dry fruits, supari, kirana items, masala (other than packed masala) like mirchi, dhaniya, sonf, methi, ajwain, suwa, haldi, kathodi, amchoor and asalia, jerra (cumin seeds) 4%

Entry 184 - All kinds of eatables and non-alcoholic potables liquids such as fruits syrups, distilled juices, jams (chatani, murabbas), fruit juices, drink concentrates of all types and forms, essences, concentrates, corn flakes and wheat flakes, custard powder, baking powder, ice cream powder and packed masala

The Department had earlier issued a clarification that packed masala meant a masala where two or more ingredients were mixed and sold in a packed condition and that spices sold singly would continue to be taxed at the lower rate. The Department hence contended that asafoetida, obtained from the roots of ferual plants, had to be mixed with additives like gum Arabic and wheat flour, and that since, asafoetide was mixed with other additives, it was taxable at the higher rate. 

The Court however held that in preparing asafoetida, instead of spices, only gum Arabic and wheat flour were mixed and no new product emerged, and hence asafoetida was taxable at the lower rate as masala (other than packed masala). It was also held that asafoetida was not a mixture of two and more spices. [Commercial Tax Officer v. Ramdev Food Products Pvt. Ltd. - [2016] 88 VST 161 (Raj.)]