Karnataka Value Added Tax Act, 2003 Chapter II - Bare Act |
| State | Karnataka Government |
| Year | 2003 |
| Section Title | Incidence and Levy of Tax |
(1) The tax shall be levied on every sale of goods in the State by a registered dealer or a dealer liable to be registered, in accordance with the provisions of this Act.
(2) The tax shall also be levied, and paid by every registered dealer or a dealer liable to be registered, on the sale of taxable goods to him, for use in the course of his business, by a person who is not registered under this Act.
(1) Every dealer who is or is required to be registered as specified in Sections 22 and 24, shall be liable to pay tax, on his taxable turnover,
(a) in respect of goods mentioned in,-
(i) Second Schedule, at the rate of one per cent,
(ii) Third Schedule, at the rate of four per cent 5[in respect of goods specified in serial number 30 and five per cent in respect of other goods] and
(iii) Fourth Schedule, at the rate of twenty per cent.
6[(b) in respect of,-
(i) cigarettes, cigars, gutkha and other manufactured tobacco at the rate of fifteen per cent;
(ii) other goods at the rate of thirteen and one half per cent]
2[(c) in respect of transfer of property in goods (whether as goods or in some other form) involved in the execution of works contract specified in column (2) of the Sixth Schedule, subject to sections 14 and 15 of the Central Sales Tax Act, 1956(Central Act 74 of 1956), at the rates specified in the corresponding entries in column (3) of the said Schedule.]2
(2) Where goods sold or purchased are contained in containers or are packed in any packing material liable to tax under this Act, the rate of tax applicable to taxable turnover of such containers or packing materials shall, whether the price of the containers or packing materials is charged for separately or not, be the same as the rate of tax applicable to such goods so contained or packed, and where such goods sold or purchased are exempt from tax under this Act, the containers or packing materials shall also be exempt.
(3) The State Government may, by notification, reduce the tax payable under sub-section (1) in respect of any goods. 2[subject to such restrictions and conditions as may be specified in the notifications.]
5[(3-A) Any notification issued under sub-section (3), shall be valid until it is cancelled or varied, notwithstanding that the tax payable in respect of any such goods is modified by amendment to this Act.]
3[(4) Notwithstanding anything contained in sub-section (1), subject to such conditions as may be prescribed, a registered dealer, if he so elects, may pay tax on the sale of goods specified in serial number 60 of the Third Schedule 5[or any other goods], on the maximum retail price indicated on the label of the container or pack thereof 4[or on such maximum retail price reduced by an amount equal to the tax payable.]
5[(5) Notwithstanding anything contained in sub-section (1), a registered dealer shall be liable to pay tax on the sale of cigarettes, cigars, gutkha and other manufactured tobacco, on the maximum retail price indicated on the label of the container or pack thereof, after reducing from such maximum retail price an amount equal to the tax payable, where the total amount payable to the dealer as the consideration for sale of such goods exceeds five hundred rupees or any other higher amount as may be notified by the Commissioner.
(6) Where tax in respect of his purchase of goods is collected in accordance with sub-section (5),-
(a) a registered dealer whose sale of such goods is not liable to tax under sub-section (5), shall be eligible for refund or adjustment of any amount of tax collected on his purchase, which is in excess of the tax payable on his turnover relating to sale of such goods, and the burden of proving that the tax has been collected and paid in accordance with the said sub-section shall be on the dealer;
(b) a person who is not a dealer liable to get registered under the Act, may claim refund of any amount paid by the selling dealer in excess of the tax payable on the consideration paid by him to such dealer in such manner and subject to such conditions as may be prescribed.]
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1. Substituted for the words "twenty five" by Karnataka Value Added Tax (Amendment) Act, ,2005.
2. Inserted by Act 4 of 2006 w.e.f. 01.04.2006.
3. Inserted by Act 27 of 2006 w.e.f. 01.04.2005.
4. Inserted by Act 6 of 2007 w.e.f. 01.04.2007.
5. Inserted by the Karnataka Value Added Tax (Amendment) Act, 2010 dated 29.03.2010 w.e.f. 01.04.2010.
6. Substituted by the Karnataka Value Added Tax (Amendment) Act, 2010 dated 29.03.2010 w.e.f. 01.04.2010 for the following :"(b) in respect of other goods, at the rate of 1[twelve and one half] per cent.'
1[(1)] Goods specified in the First Schedule and any other goods as may be specified by a notification by the State Government shall be exempt from the tax payable under this Act. 3[subject to much restrictions and conditions as may be specified in the notifications]
4[(1-A) Any notification issued under sub-section (1), shall be valid until it is cancelled or varied, notwithstanding that the tax payable in respect of such goods is modified by amendment to this Act.]
2[(2) Notwithstanding anything contained in this Act, the Government may, in such circumstances and subject to such conditions as may be specified, by notification, and subject to such rules as may be prescribed, exempt the whole or any part of the tax payable for any period on sale of goods made to or made by a new industrial unit, in respect of which the Government has already notified exemption of tax under the provisions of the Karnataka Sales Tax Act, 1957 (Karnataka Act 25 of 1957), and such exemption on purchases or sales shall be by way of refund of tax collected on purchases or sales made by such industrial unit.]
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1. Section 5 renumbered as sub section (1) by Karnataka Taxation Laws (Amendment ) Act ,2005.
2. Inserted by Karnataka Taxation Laws (Amendment ) Act, 2005.
3. Inserted by Act 4 of 2006 w.e.f. 11.03.2005.
4. Inserted by the Karnataka Value Added Tax (Amendment) Act, 2010 w.e.f. 01.04.2010.
(1) The sale or purchase of goods, other than in the course of inter-State trade or commerce or in the course of import or export, shall be deemed, for the purposes of this Act, to have taken place in the State irrespective of the place where the contract of sale or purchase is made, if the goods are within the State.-
(a) in the case of specific or ascertained goods, at the time the contract of sale or purchase is made; and
(b) in the case of unascertained or future goods, at the time of their appropriation to the contract of sale or purchase by the seller or by the purchaser, whether the assent of the other party is prior or subsequent to such appropriation.
(2) Where there is a single contract of sale or purchase of goods situated at more places than one, the provisions of clause (a) shall apply as if there were separate contracts in respect of goods at each of such places.
(3) Notwithstanding anything contained in the Sale of Goods Act, 1930 (Central Act 3 of 1930), for the purpose of this Act, the transfer of property of goods (whether as goods or in some other form) involved in the execution of a works contract shall be deemed to have taken place in the State, if the goods are within the State at the time of such transfer, irrespective of the place where the agreement for works contract is made, whether the assent of the other party is prior or subsequent to such transfer.
(4) Notwithstanding anything contained in the Sale of Goods Act, 1930 (Central Act 3 of 1930), for the purpose of this Act, the transfer of the right to use any goods for any purpose (whether or not for a specified period) shall be deemed to have taken place in the State, if such goods are for use within the State irrespective of the place where the contract of transfer of the right to use the goods is made.
(1) Notwithstanding anything contained in the Sale of Goods Act, 1930 (Central Act 3 of 1930), for the purpose of this Act, and subject to subsection (2), the sale of goods shall be deemed to have taken place at the time of transfer of title or possession or incorporation of the goods in the course of execution of any works contract whether or not there is receipt of payment:
Provided that where a dealer issues a tax invoice in respect of such sale within fourteen days from the date of the sale, the sale shall be deemed to have taken place at the time the invoice is issued.
(2) Where, before the time applicable in sub-section (1), the dealer selling the goods issues a tax invoice in respect of such sale or receives payment in respect of such sale, the sale shall, to the extent that it is covered by the invoice or payment, be deemed to have taken at the time the invoice is issued or the payment is received.
(3) The Commissioner may on an application of any dealer exempt such dealer subject to such conditions as he may specify, from the time specified in sub- section (1).
(1) Notwithstanding anything contained in any law for the time being in force including this Act, every person who, for an agreed commission or brokerage, buys or sells on behalf of any principal who is a resident of the State shall be liable to tax under this Act at the rate or rates leviable thereunder in respect of such purchase or sale, notwithstanding that such principal is not a dealer or that the turnover of purchase or sale relating to such principal is less than the minimum specified in sub-sections (1), (2) and (3) of Section 22.
(2) The principal shall not be liable to tax on his turnover in respect of which the agent is liable to tax under sub-section (1), and the burden of proving that the turnover has been effected through an agent liable to tax under the said sub-section, shall be on such principal.
(1) Every registered dealer liable to pay tax under the Act shall collect such tax at the rate or rates at which he is liable to pay tax, and the tax collected shall be accounted for under the provisions of this Act and rules made thereunder.
(2) The Central Government, a State Government, a statutory body or a local authority shall, in respect of any taxable sale of goods effected by them, collect by way of tax any amount which a registered dealer effecting such sale would have collected by way of tax under this Act, issue a tax invoice, pay the tax so collected into the Government Treasury or any designated bank and furnish monthly returns, as specified under Section 35, to the prescribed authority.
1[9-A. Deduction of tax at source (in case of works contract)
(1) Notwithstanding anything contained in this Act, the Central Government, or any State Government, or an industrial, commercial or trading undertaking of the Central Government or of any state, or any such undertaking in joint sector or any other industrial, commercial or trading undertaking or any other person or body as may be notified by the Commissioner from time to time or a local authority or a statutory body, shall deduct out of the amounts payable by them to a dealer in respect of any works contract executed for them in the State, an amount equivalent to the tax payable by such dealer under the Act.
(2) No such deduction shall be made under sub section (1) ,if the amounts payable by them are in respect of sales of any goods , in the course of inter -state trade or commerce or , in the course of export out of the territory of India or, import into the territory of India or, outside the State.
(3) The deduction under sub section (1) shall be made by an authority on the basis of tax payable as calculated by the deale r.
2[(4) (a) Where it is found that the tax payable as calculated by any dealer is less than the tax payable for the works contract executed by him by more than fifteen percent, the officer empowered by the Commissioner shall so inform the authority responsible for deduction of tax under sub- section (1).
(b) On such information, the authority responsible for deduction of tax or the dealer shall make an application to such officer for issue of a certificate, and the officer so empowered by the Commissioner shall issue the certificate within ten days from the date of receipt of the application, failing which the authority responsible for deduction of tax shall make deduction as calculated by the dealer till the issue of the certificate.
(c) After issue of certificate, such deduction shall be made out of any amounts payable subsequently to such dealer based on the certificate issued by such officer.]
(5) The authority making deduction under sub- section(1) , shall send every month to the prescribed authority a statement in the prescribed form containing particulars of tax deducted during the preceeding month and pay full amount of tax so deducted by it within twenty days after the close of the preceeding month in which such deductions were made and the amount so payable shall for the purposes of Section 42 be deemed to be an amount due under this Act.
(6) Where default is made in complying with the provisions of sub -section (5) ,the prescribed authority may, after such enquiry as it deems fit and after giving opportunity to the concerned authority of being heard, determine to the best of its judgement, the amount of tax payable under this sub -section by such authority and the amount so determined shall be deemed to be the tax due under the Act for the purpose of Section 42.
(7) If default is committed in the payment of tax deducted beyond ten days after the expiry of said period specified under sub-section (5) , the authority making deductions under sub section (1) shall pay , by way of interest, a sum equal to the interest specified under sub -section (1) of Section 37 during the period in which such default is continued.
(8) The authority making deduction under sub -section (1) , shall furnish to the dealer from whom such deduction is made, a certificate obtained from the prescribed authority containing such particulars as may be prescribed.
(9) Payment by way of deduction in accordance with sub -section (5), shall be without prejudice to any other mode of recovery of tax due under this Act from the dealer executing the works contract.
(10) Where tax in respect of the works contract is remitted under sub -section (5), the tax payable by the dealer for any period, 3[***] shall be reduced by the amount of tax already remitted under the said sub-section.
(11) The burden of proving that the tax on such works contract has already been remitted and of establishing the exact quantum of tax so remitted shall be on the dealer claiming the reduction of t ax under sub-section (10).]
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1. Inserted by Karnataka Value Added Tax (Amendment) Act ,2005.
2. Substituted by Act 4 of 2006 w.e.f. 01.04.2006 for the following : -
"(4) Where it is found that the tax payable as calculated by any dealer was less than the tax payable for the works contract executed by more than fifteen per cent and being so informed, the authority shall make deduction out of any amounts payable subsequently based on the certificate issued by the Assessing Authority of the dealer on an application to be made by the authority or dealer which shall be disposed of by the Assessing Authority with in ten days from the date of its receipt, failing which deduction shall be made as calculated by the dealer till issue of certificate."
3. Omitted by Act 4 of 2006 w.e.f. 01.04.2006.
"in respect of such works contract"
(1) Output tax in relation to any registered dealer means the tax payable under this Act in respect of any taxable sale of goods made by that dealer in the course of his business, and includes tax payable by a commission agent in respect of taxable sales of goods made on behalf of such dealer subject to issue of a prescribed declaration by such agent.
(2) Subject to input tax restrictions specified in Sections 11,12,14, 1[17 and 18], input tax in relation to any registered dealer means the tax collected or payable under this Act on the sale to him of any goods for use in the course of his business, and includes the tax on the sale of goods to his agent who purchases such goods on his behalf subject to the manner as may be prescribed to claim input tax in such cases.
(3) Subject to input tax restrictions specified in Sections 11, 12, 14, 17, 18 and 19, the net tax payable by a registered dealer in respect of each tax period shall be the amount of output tax payable by him in that period less the input tax deductible by him as may be prescribed in that period and shall be accounted for in accordance with the provisions of 2[Under this Act]
(4) For the purpose of calculating the amount of net tax to be paid or refunded, no deduction for input tax shall be made unless a tax invoice, debit note or credit note, in relation to a sale, has been issued in accordance with Section 29 or Section 30 and is with the registered dealer taking the deduction at the time any return in respect of the sale is furnished, except such tax paid under sub-section (2) of Section 3.
(5) Subject to input tax restrictions specified in Sections 11,12, 14, 17, 18 and 19, where under sub-section (3) the input tax deductible by a dealer exceeds the output tax payable by him, the excess amount shall be adjusted or refunded together with interest, as may be prescribed.
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1. Substituted for the figures ,comma and word "17, 18 and 19" by Karnataka Value Added Tax (Amendment) Act, 2005.
2. Substituted by Act 10 of 2008.
"Chapter V."
(a) Input tax shall not be deducted in calculating the net tax payable, in respect of:
(1) Tax paid on purchases attributable to sale 2[or manufacture or processing or packing or storage] of exempted goods exempted under Section 5, except when such goods are sold in the course of export out of the territory of India;
3[(2) tax paid on goods as specified in the Fifth Schedule subject to such conditions as may be specified, purchased and put to use for purposes other than for,
(i) resale, or
(ii) manufacture or any other process of other goods for sale;
(3) tax paid on purchase of goods as may be notified by the Government or Commissioner subject to such conditions as may be specified;
(4) tax paid on purchase of capital goods other than those falling under clause (2) or (3) except as provided in section 12;
(5) tax paid on purchase of goods, that are despatched outside the State or used as inputs in the manufacture, processing or packing of other taxable goods despatched to a place outside the State, other than as a direct result of sale or purchase in the course of inter-State trade or commerce except as provided in section 14.]
(6) tax paid on purchases attributable to naptha, liquified petroleum gas, furnace oil, 4[***] superior kerosene oil, kerosene and any other petroleumproduct, when used as fuel in motor vehicles, but when used as fuel inproduction of any goods for sale in the course of export out of the territory ofIndia or taxable goods or captive power, input tax shall be deducted as providedin Section 14.
(7) tax paid under sub-section (2) of Section 3 on the purchase of fuel;
(8) tax paid under sub-section (2) of Section 3 on the purchase of goods excludingfuel, until output tax is payable on such goods or other goods in which such goods are put to use except when the said goods are exported out of the territory of India;
(9) tax paid on goods purchased by a dealer who is required to be registered under the Act, but has failed to register.
(b) Input tax shall not be deducted by an agent purchasing or selling goods on behalf of any other person other than a non-resident principal.
5[(c) Input tax shall not be deducted by any dealer executing a works contract 6[in respect of the amount claimed as deduction] paid or payable to any sub-contractor as the consideration for execution of part or whole of such works contract for him.]
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1. Inserted by Karnataka Value Added Tax (Amendment) Act, 2005.
2. Shall be and shall always be deemed to have been substituted by Act 10 of 2008.
3. Substituted by Act 4 of 2006 w.e.f. 01.04.2006.
"(2) tax paid on purchase of goods that are dispatched outside the State, other thanas a direct result of sale or purchase in the course of inter-State trade or commerce;
(3) tax paid on goods including capital goods as specified in the Fifth Schedule andany other goods as may be notified by the Government or the Commissioner, purchased 1[including when transferredin the execution of a works contract ]or put to use for purposes other than for re-sale;
(4) tax paid on purchase of capital goods other than those falling under clause (3) ,except as provided in Section 12;
(5) tax paid on purchase of goods used as inputs in the manufacture, processing orpacking of other taxable goods despatched to a place outside the State not as adirect result of sale or purchase in the course of inter-State trade, except as provided in Section 14;"
4. Shall be and shall always be deemed to have been omitted by Act 6 of 2007.
"light diesel oil,"
5. Shall be deemed to have been inserted with effect form the first day of April, 2006 by Act 10 of 2008.
6. Substituted by the Karnataka Value Added Tax (Amendment) Act, 2009 Act No. 5 of 2009.
"who is claiming deduction on any amount"
(1) Deduction of input tax shall be allowed to the registered dealer in respect of the purchase of capital goods 1[on or after the commencement of this Act ]for use in the business of sale of any goods in the course of export out of the territory of India and in the case of any other dealer in respect of the purchase of capital goods wholly or partly for use in the business of taxable goods.
(2) Deduction of input tax under this Section shall be allowed only after commencement of commercial production, or sale of taxable goods or sale of any goods in the course of export out of the territory of the India by the registered dealer 2[***]
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1. Inserted by Karnataka Value Added Tax (Amendment) Act, 2005.
2. Omitted by Act 4 of 2006 w.e.f. 01.04.2006.
"and shall be apportioned over a specified period, as may be prescribed."
Deduction of input tax shall be allowed to the registered dealer, subject to the restrictions of Section 11, in respect of tax charged to him by a seller on taxable sale of goods made to him for the purpose of the business within three months prior to the date of his registration provided that no input tax shall be allowed in respect of goods which have been sold or otherwise disposed of prior to the date of registration.
1[Deduction of input tax shall be allowed on purchase of goods, specified in clauses (5) and (6) of sub-section (a) of Section 11, to the extent of the input tax charged at a rate higher than four per cent or any lower rate as may be notified by the Government.]
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1. substituted by Act 4 of 2006 w.e.f. 01.04.2006.
"Deduction of input tax shall be allowed on the difference between the rate of input tax charged at a rate higher than four per cent and the rate specified in Third Schedule on purchases specified in sub-section (5) and sub-section (6) of Section 11."
(1) Subject to such conditions and in such circumstances as may be prescribed, any dealer other than a dealer who purchases or obtains goods from outside the State or from outside the territory of India, liable to pay tax as specified in Section 4 and,
2[(a) whose total turnover 3[in a year] does not exceed an amount as may be notified by the State Government which shall not exceed fifty lakh rupees, and who is not a dealer falling under clause (b) or (c) or (d) below;]
(b) who is a dealer executing works contracts; or
(c) who is a hotelier, restaurateur, caterer; 4[or dealer running a sweetmeat stall or an ice cream parlour] 5[or bakery or any other class of dealers as may be notified by the Government]
(d) who is a mechanised crushing unit producing 6[granite or any other metals];
may elect to pay in lieu of the net amount of tax payable by him under this Act by way of composition, an amount at such rate not exceeding five per cent on his total turnover or on the total consideration for the works contracts executed or not exceeding two lakh rupees for each crushing machine1[per annum as may be notified by the Governement].
7[(2) Notwithstanding anything contained in sub-section (1), a dealer whose nature of business is of a type falling under more than one clause of sub-section (1), shall be eligible to opt for composition under the said sub-section in respect of tax payable on his turnover relating to any or all of such types of business subject to the condition that,
(a) such dealer maintains separate account of each type of his business;
(b) the total turnover in a year in respect of all types of business of such dealer falling under clause (a) of sub-section (1) does not exceed the amount as may be notified under the said clause;
(c) the amount payable by way of composition by such dealer on his total turnover or the total consideration in respect of each type of such business shall be as may be notified for such type under sub-section (1);
(d) the total turnover of such dealer from all his types of business shall be reduced to the extent of the total turnover or total consideration in respect of each such type, for calculating the amount payable by way of composition for such type of business under sub-section (1); and
(e) in respect of such type of business for which, he has not exercised his option or is not eligible, for composition under sub-section (1), then on the taxable turnover as determined from the balance total turnover after reduction as specified in clause (d), he shall be liable to tax as specified under section 4.]
(3) Any dealer eligible for composition of tax under sub-section (1) may report, to the prescribed authority, the exercise of his option and he shall pay such amount due and furnish a return in such manner as may be prescribed.
(4) Any dealer opting for composition of tax under 8[under this section] shall not be permitted to claim any input tax on any purchases made by him.
(5) Notwithstanding anything contained in sub-sections (1) 9[***],-
(a) a dealer executing works contracts and who purchases or obtains goods from outside the State or from outside the territory of India shall be eligible to opt for composition under sub-section (1),and if the property in such goods (whether as goods or in some other form) is transferred in any works contract executed by him, the dealer shall be liable to pay tax on the value of such goods at the rate specified in section 4, and such value shall be deducted from the total consideration of the works contracts executed on which an amount as notified is payable under sub-section (1) by way of composition in lieu of the tax payable under the Act;
(b) in the case of a dealer executing works contracts and opting for composition of tax under sub-section (1), no tax by way of composition shall be payable on the
10[amounts payable or paid] to a sub-contractor as consideration for execution of works contract whether wholly or partly and such amounts shall be deducted from the total consideration of the works contracts executed on which an amount as notified is payable under sub-section (1) by way of composition in lieu of the tax payable under the Act subject to production of proof that such sub-contractor is a registered dealer liable to tax under the Act and that such amounts are included in the return filed by such sub-contractor;
(c) in the case of a dealer executing works contracts, after opting for composition of tax under sub-section (1), 11[who] effects sale of any goods liable to tax under the Act other than by transfer of the property in such goods (whether as goods or in some other form) in any works contract executed by him, the dealer shall be liable to pay tax on the value of such goods at the rate specified in section 4, without any deduction for input tax on purchase of such goods made by him;
(d) in the case of a dealer opting for composition of tax under clause (a) or (c) of sub-section (1), the turnover on which tax is leviable under sub-section (2) of section 3 shall be deducted from the total turnover on which an amount as notified is payable under sub-section (1) by way of composition in lieu of the tax payable under 12[the Act;] .
13[(e) a dealer executing works contracts and opting for composition of tax under sub-section (1), shall be liable to pay tax, if any, under sub-section (2) of section 3,in addition to tax by way of composition on the total consideration for the works contracts executed;]
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1. Substituted for the words "per annum as may be prescribed" by Karnataka Taxation Laws (Amendment) Act, 2005.
2. Substituted by Act 4 of 2006 w.e.f. 01.04.2006.
(a) whose total turnover in a period of four consecutive quarters does not exceed fifteen lakh rupees; or
3. Substituted by Act 6 of 2007 w.e.f. 01.04.2007.
"in a period of four consecutive quarters does"
4. Inserted by Act 27 of 2005 w.e.f. 07.06.2005.
5. Inserted by Act 4 of 2006 w.e.f. 01.04.2006.
6. Substituted by Act 4 of 2006 w.e.f. 01.04.2006.
"granite metals;"
7. Substituted by Act 6 of 2007 w.e.f. 01.04.2007.
"(2) For the purposes of sub-section (1) a quarter shall mean any period ending on final day of the months of March, June, September and December."
8. Shall be deemed to have been substituted with effect form the first day of April, 2006 by Act 10 of 2008
"sub-section (1)"
9. XXX shall be deemed to have been substituted with effect from the first day of April, 2006 by Act 10 of 2008
10. Substituted by Act 6 of 2007 w.e.f. 1.4.2007.
11. shall be and shall always be deemed to have been inserted by Act 6 of 2007.
12. Shall be and shall always be deemed to have been substituted by Act 6 of 2007 w.e.f. 11.3.2005
13. Inserted by Act 6 of 2007 w.e.f. 1.4.2006.
Where a dealer liable to pay tax under Section 4 is unable to identify each individual sale, its value or the rate of tax, 1[or is unable to issue a tax invoice as specified in section 29 for each individual sale] he may apply to the prescribed authority to pay net tax under Section 10 under a special method to be mutually agreed by such authority in such manner as may be prescribed.
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1. Inserted by Act 27of 2005 w.e.f. 1.6.2005.
Where a registered dealer deducting input tax
(1) makes sales of taxable goods and goods exempt under Section 5, or
(2) in addition 1[sales of taxable goods or] the sales referred to in clause (1), dispatches taxable goods or goods exempted under Section 5 outside the State not as a direct result of sale or purchase in the course of inter-State trade, or
(3) puts to use the inputs purchased in any other purpose (other than sale, manufacturing, processing, packing or storing of goods), in addition to use in the course of his business, 1[or]
1[(4) falls under any of the above clauses and also purchases any petroleum product for use as fuel in production of any goods or captive power,]
apportionment and attribution of input tax deductible between such sales and despatches of goods or such purpose, shall be made in accordance with Rules or by special methods to be approved by the Commissioner or any other authorised person and any input tax deducted in excess shall become repayable forthwith.
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1. Shall be and shall always be deemed to have been inserted by Act 6 of 2007 w.e.f. 11.3.2005.
2[ (1) Notwithstanding anything contained in this Act, a factory or other industrial concern or any other establishment, in which a canteen or cafeteria or restaurant or other similar facility is run, through a dealer, as an amenity provided for the employees of such factories or concerns or establishments, shall deduct out of any amounts payable by them to such dealer as their contribution by whatever name called, in respect of sale of articles of food and drinks to their employees, an amount at the rate of four percent of the aggregate of the sale prices received or receivable by such dealer from the employees and contribution paid or payable by such factories or concerns or establishments to such dealer.
(2) No deduction shall be made under sub-section (1) if the aggregate of the sale prices received or receivable by and contribution paid or payable to such dealer in respect of sale of articles of food and drinks to the employees is less than 3[five lakh rupees] in a year.
(3) The factory or other industrial concern or other establishment making deduction under sub-section (1), shall send every month to the prescribed authority a statement in the prescribed form containing particulars of tax deducted during the preceding month and pay full amount of the tax so deducted by it within twenty days after the close of the preceding month in which such deduction was made and the amount so payable shall be deemed to be the tax due under this Act for the purposes of section 42.
(4) If default is committed in the payment of tax deducted beyond ten days after the expiry of the period specified under sub-section (3), the factory or concern or establishment making deduction under sub-section (1) shall pay, by way of interest, a sum equal to the interest specified under sub-section (1) of section 37 during the period in which such default is continued.
(5) The factory or concern or establishment making deduction under sub-section (1) shall furnish to the dealer from whom such deduction is made, a certificate obtained from the prescribed authority containing such particulars as may be prescribed.
(6) Payment by way of deduction in accordance with sub-section (3), shall be without prejudice to any other mode of recovery of tax due under this Act from such dealer referred to in sub-section (1).
(7) Where tax in respect of the dealer referred to in sub-section (1) is remitted under sub-section (3), the tax payable by the dealer for any period, shall be reduced by the amount of tax already remitted under the said sub-section.
(8) The burden of proving that the tax on his turnover relating to sale of articles of food and drinks has already been remitted and of establishing the exact quantum of tax so remitted shall be on the dealer claiming the reduction.]
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1. Substituted by Karnataka Value Added Tax (Amendment) Act ,2005.
2. Substituted by Act 4 of 2006 w.e.f 01.04.2006.
"1[Transitional provisions -Transitional provisions covering relief on tax paid under the Karnataka Sales Tax Act, 1957 (Karnataka Act 25 of 1957) on stock in hand relating to goods purchased on or after first day of April, 2004 and used for manufacture or resale, at the date of commencement of this Act, Shall be as prescribed.
3. Substituted by the Karnataka Value Added Tax (Amendment) Act, 2010 dated 29.03.2010 w.e.f. 01.04.2010 for the following:" two lakh rupees"
1[(1) Notwithstanding anything contained in this Act, every registered dealer purchasing oil seeds or non-refined oil or oil cake or scrap of iron and steel or any other goods as may be notified by the Commissioner, for use in manufacture or processing or any other purpose as may be notified by the Commissioner, shall deduct out of the amounts payable by him to the registered dealer selling such goods to him, an amount equivalent to the tax payable on the sale of such goods under section 4.
(2) No such deduction shall be made under sub-section (1), if the amounts payable by them are in respect of sales of any goods, in the course of inter-State trade or commerce or, in the course of export out of the territory of India or, import into the territory of India or, outside the State.
(3) The deduction under sub-section (1) shall be made by the dealer on the basis of tax invoice issued by the selling dealer.
(4) The dealer making deduction under sub-section (1), shall send every month to the prescribed authority a statement in the prescribed form containing particulars of tax deducted during the preceding month and 2[after adjusting the amount of tax so deducted by him towards any net tax payable by him for the preceding month,] by him, within twenty days after the close of the preceding month in which such deductions were made and the amount so payable shall for the purposes of Section 42 be deemed to be an amount due under this Act.
(5) Where default is made in complying with the 3[provisions of sub- section (4)], the prescribed authority may, after such enquiry as it deems fit and after giving opportunity to the concerned dealer of being heard, determine to the best of its judgment, the amount payable under this sub-section by such dealer and the amount so determined shall be deemed to be an amount due under the Act for the purposes of Section 42.
(6) If default is committed in the payment of tax deducted beyond the period specified under sub-section (4), the dealer making deductions under sub-section (1) shall pay, by way of interest, a sum equal to the interest specified under sub-section (1) of Section 37 during the period in which such default is continued.
(7) The dealer making deduction under sub-section (1) shall furnish to the dealer from whom such deduction is made, a certificate obtained from the prescribed authority containing such particulars as may be prescribed.
(8) Payment by way of deduction in accordance with sub-section (4), shall be without prejudice to any other mode of recovery of tax due under this Act from the selling dealer.
(9) Where tax in respect of his sales of goods specified in sub-section (1) is remitted under sub-section (4), the tax payable by such selling dealer for any period, in respect of such sales shall be reduced by the amount of tax already remitted under the said sub-section.
(10) The burden of proving that the tax on such sales has already been remitted and of establishing the exact quantum of tax so remitted shall be on the dealer claiming the reduction.]
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1. inserted by Act 10 of 2008 w.e.f 1.8.2008
2. Inserted by Act 6 of 2007 w.e.f. 1.4.2007.
3. Substituted by the Karnataka Value Added Tax (Amendment) Act, 2010 dated 29.03.2010 for the following :"provisions of this sub-section"
(1) Where a registered dealer has deducted input tax on any goods and those goods are not used in the course of his business or lost or destroyed, any input tax deducted becomes repayable in the period following the date on which those goods were put to such other use.
(2) Where such goods have been wholly or mainly used or are intended for use in sale of taxable goods or in sale of any goods in the course of export out of the territory of Indiaprior to the change of use, 1[input tax repayable shall be calculated] on the prevailing market value of such goods at the time of change of use.
2[(3) Where a registered dealer after deducting input tax on any goods used in the course of his business, opts for composition of tax under section 15, the input tax deducted on the goods held in stock on the date on which the dealer so opts shall be repayable by the dealer in the tax period following such date and the input tax so repayable shall be calculated on the market value of such goods on such date.]
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1. Shall be and shall always be deemed to have been substituted by Act 6 of 2007 w.e.f. 11.03.2005.
"tax shall be calculated"
2. Inserted by the Karnataka Value Added Tax (Amendment) Act, 2009 Act 32 of 2004.
(1) Tax paid under this Act by any dealer on purchase of inputs in respect of
(a) any goods sold in the course of export out of the territory of India, or
(b) any goods taxable under the Act, sold in the course of interstate trade or commerce.
(c)1[****]
(d)1[****]
shall be deducted as provided under Section 10 2[subject to such conditions as may be prescribed] from output tax payable by such dealer.
3[(2) Tax paid under this Act on purchase of inputs by a registered dealer who is a unit located in any special economic zone established under authorization by the authorities specified by the Central Government in this behalf, shall be deducted as provided under Section 10 subject to such conditions as may be prescribed, from the output tax payable by such dealer.] .
Explanation 1.- For the purposes of this section, the expression ''special economic zone'' has the meaning assigned to it in clause (iii) to Explanation 2 to the proviso to section 3 of the Central Excise Act, 1944 (Central Act 1 of 1944).
Explanation 2.-1[****]
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1. Omitted by Karnataka Value Added Tax (Amendment) Act ,2005.
2. Substituted by Karnataka Value Added Tax (Amendment) Act ,2005.
3. Inserted by Karnataka Value Added Tax (Amendment) Act, 2005
Tax collected under this Act on purchases made by specialised agencies of the United Nations Organisation and Consulates or Embassies of any other country 1[but excluding consulates or embassies of such countries as may be notified] 2[***] shall be reimbursed in such manner and subject to such conditions as may be prescribed.
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1. Inserted by Act 6 of 2007 w.e.f. 01.04.2007.
2. omitted by Act 4 of 2006 w.e.f. 01.04.2006.
"located in the State"