The Andhra Pradesh Goods and Services Tax Act, 2017
**THE ANDHRA PRADESH GOODS AND SERVICES TAX ACT, 2017**

**ARRANGEMENT OF SECTIONS**

**(ACT No.16 of 2017)**

**SECTIONS**

**CHAPTER I**

**PRELIMINARY**

1. Short title, extent and commencement

2. Definitions

**CHAPTER II**

**ADMINISTRATION**

3. Officers under this Act

4. Appointment of officers

5. Powers of officers

6. Authorization of officers of central tax as proper officer in certain

circumstances

**CHAPTER III**

**LEVY AND COLLECTION OF TAX**

7. Scope of supply

8. Tax liability on composite and mixed supplies

9. Levy and collection

10. Composition levy

11. Power to grant exemption from tax

**CHAPTER IV**

**TIME AND VALUE OF SUPPLY**

12. Time of supply of goods

13. Time of supply of services

14. Change in rate of tax in respect of supply of goods or services

15. Value of taxable supply

**CHAPTER V**

**INPUT TAX CREDIT**

16. Eligibility and conditions for taking input tax credit

17. Apportionment of credit and blocked credits

18. Availability of credit in special circumstances

19. Taking input tax credit in respect of inputs sent for job work and

capital goods


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20. Manner of distribution of credit by Input Service Distributor

21. Manner of recovery of credit distributed in excess

**CHAPTER –VI**

**REGISTRATION**

22. Persons liable for registration

23. Persons not liable for registration

24. Compulsory registration in certain cases

25. Procedure for Registration

26. Deemed Registration

27. Special provisions relating to casual taxable person and non
resident taxable person

28. Amendment of registration

29. Cancellation of Registration

30. Revocation of cancellation of registration

**CHAPTER – VII**

**TAX INVOICE, CREDIT AND DEBIT NOTES**

31. Tax invoice

32. Prohibition on un authorised collection of tax

33. Amount of tax to be indicated in tax invoice and other documents

34. Credit and debit notes

**CHAPTER VIII**

**ACCOUNTS AND RECORDS**

35. Accounts and other records

36. Period of retention of accounts

**CHAPTER –IX**

**RETURNS**

37. Furnishing details of outward supplies

38. Furnishing details of inward supplies

39. Furnishing of Returns

40. First Return

41. Claim of input tax credit and provisional acceptance thereof

42. Matching, reversal and reclaim of input tax

43. Matching, reversal and reclaim of reduction in output tax liability

44. Annual return

45. Final return

46. Notice to return defaulters

47. Levy of late fee

48. Goods and services tax practitioners


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**CHAPTER –X**

**PAYMENT OF TAX**

49. Payment of tax, interest, penalty and other amounts

50. Interest on delayed payment of tax

51. Tax deduction at source

52. Collection of tax at source

53. Transfer of input tax credit

**CHAPTER XI**

**REFUNDS**

54. Refund of tax

55. Refund in certain cases

56. Interest on delayed refunds

57. Consumer Welfare Fund

58. Utilisation of Fund

**CHAPTER – XII**

**ASSESSMENT**

59. Self-Assessment

60. Provisional Assessment

61. Scrutiny of returns

62. Assessment of non-filers of returns

63. Assessment of unregistered persons

64. Summary assessment in certain special cases

**CHAPTER XIII**

**AUDIT**

65. Audit by tax authorities

66. Special Audit

**CHAPTER XIV**

**INSPECTION, SEARCH, SEIZURE AND ARREST**

67. Power of inspection, search and seizure

68. Inspection of goods in movement


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69. Power to arrest

70. Power to summon persons to give evidence and produce documents

71. Access to business premises

72. Officers to assist proper officers

**CHAPTER XV**

**DEMANDS AND RECOVERY**

73. Determination of tax not paid or short paid or erroneously refunded or

input tax credit wrongly availed or utilised for any reason other than
fraud or any wilful misstatement of facts

74. Determination of tax not paid or short paid or erroneously refunded or

input tax credit wrongly availed or utilised by reason of fraud or any
wilful-misstatement or suppression of facts

75. General provisions relating to determination of tax
76. Tax collected but not paid to Government
77. Tax wrongfully collected and paid to Central Government or State

Government

78. Initiation of recovery proceedings
79. Recovery of tax
80. Payment of tax and other amount in instalments
81. Transfer of property to be void in certain cases

82. Tax to be first charge on property

83. Provisional attachment to protect revenue in certain cases

84. Continuation and validation of certain recovery proceedings

**CHAPTER XVI**

**LIABILITY TO PAY IN CERTAIN CASES**

85. Liability in case of transfer of business

86. Liability of agent and principal

87. Liability in case of amalgamation or merger of companies

88. Liability in case of company in liquidation

89. Liability of directors of private company

90. Liability of partners of firm to pay tax

91. Liability of guardians, trustees etc

92. Liability of Court of Wards etc

93. Special provisions regarding liability to pay tax, interest or

penalty in certain cases

94. Liability in other cases

**CHAPTER XVII**


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**ADVANCE RULING**

95. Definitions

96. Constitution of Authority for Advance Ruling

97. Application for advance ruling

98. Procedure on receipt of application

99. Constitution of Appellate Authority for Advance Ruling

100. Appeal to the Appellate Authority

101. Orders of Appellate Authority

102. Rectification of advance ruling

103. Applicability of advance ruling

104. Advance ruling to be void in certain circumstances

105. Powers of Authority and Appellate Authority

106. Procedure of Authority and Appellate Authority

**CHAPTER-XVIII**

**APPEALS AND REVISION**

107. Appeals to Appellate Authority

108. Powers of Revisional Authority

109. Appellate Tribunal and Benches thereof

110. President and members of Appellate Tribunal, their

qualification, appointment, conditions of service, etc

111. Procedure before Appellate Tribunal

112. Appeals to Appellate Tribunal

113. Orders of Appellate Tribunal

114. Financial and administrative powers of State President

115. Interest on refund of amount paid for admission of appeal

116. Appearance by authorised representative

117. Appeal to High Court

118. Appeal to Supreme Court

119. Sums due to be Paid Notwithstanding appeal etc

120. Appeal not to be filed in certain cases

121. Non Appealable decisions and orders

**CHAPTER  XIX**

**OFFENCES AND PENALTIES**

122. Penalty for certain offences

123. Penalty for failure To furnish information return

124. Fine for failure to furnish statistics

125. General Penalty

126. General disciplines related penalty


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127. Power to impose penalty in certain cases

128. Power to waive penalty or fee or both

129. Detention, Seizure and release of goods and conveyances in

transit

130. Confiscation of goods or conveyances and levy of penalty

131. Confiscation or penalty not to interfere with other

punishments

132. Punishment for certain offences

133. Liability of officers and certain other persons

134. Cognizance of offences

135. Presumption of culpable mental state

136. Relevancy of statements under certain circumstances

137. Offences by Companies

138. Compounding of offences

**CHAPTER XX**

**TRANSITIONAL PROVISIONS**

139. Migration of existing taxpayers

140. Transitional arrangements for input tax credit

141. Transitional provisions relating to job work

142. Miscellaneous transitional provisions

**CHAPTER XXI**

**MISCELLANEOUS PROVISIONS**

143. Job work procedure

144. Presumption as to documents in certain cases

145. Admissibility of micro films, facsimile copies of documents and

computer printouts as documents and as evidence

146. Common Portal

147. Deemed Exports

148. Special Procedure for certain processes

149. Goods and services tax compliance rating

150. Obligation to furnish information return

151. Power to collect statistics

152. Bar on disclosure of information required under section 151

153. Taking assistance from an expert

154. Power to take samples

155. Burden of Proof

156. Persons deemed to be public servants

157. Protection of action taken under this Act


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158. Disclosure of information by a public servant

159. Publication of information respecting persons in certain

cases

160. Assessment proceedings, etc., not to be invalid on certain

grounds

161. Rectification of errors apparent on the face of record

162. Bar on jurisdiction of civil courts

163. Levy of fee

164. Power of Government to make rules

165. Power to make regulations

166. Laying of rules, regulations and notifications

167. Delegation of power

168. Power to issue instructions or directions

169. Service of notice in certain circumstances

170. Rounding off of tax etc

171. Anti-profiteering Measure

172. Removal of difficulties

173. Amendment of certain Acts

174. Repeal and saving

**SCHEDULE –I**

**[See Section 7]**

**ACTIVITIES TO BE TREATED AS SUPLY EVEN IF MADE WITHOUT**

**CONSIDERATION**

Nil

**SCHEDULE II**

**[See Section 7]**

**ACTIVITIES TO BE TREATED AS SUPPLY OF GOODS OR**

**SUPPLY OF SERVICES**

1. Transfer

2. Land and Building:
3. Treatment or process

4. Transfer of business assets

5. Supply of services

6. Composite supply

7. Supply of Goods

**SCHEDULE III**


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**[See Section 7]**

**ACTIVITIES OR TRANSACTIONS WHICH SHALL BE TREATED NEITHER**

**AS A SUPPLY OF GOODS NOR A SUPPLY OF SERVICES**

Nil

**THE ANDHRA PRADESH GOODS AND SERVICES TAX ACT, 2017**

**ACT No.16 of 2017**

(7[Th] June, 2017)

**AN ACT TO MAKE A PROVISION FOR LEVY AND COLLECTION OF TAX ON**
**INTRA-STATE SUPPLY OF GOODS OR SERVICES OR BOTH BY THE STATE**
**OF ANDHRA PRADESH AND FOR MATTERS CONNECTED TEHREWITH**
**AND INCIDENTAL THERETO.**

Be it enacted by the Legislature of the State of Andhra Pradesh in the

Sixty-eighth Year of the Republic of India as follows:
**CHAPTER I**

**PRELIMINARY**

**1.** **Short title, extent and commencement- (1) This Act may be called the**
Andhra Pradesh Goods and Services Tax Act, 2017.

(2) It extends to the whole of the State of Andhra Pradesh.

(3) It shall come into force on such date as the State Government may,

by notification in the Andhra Pradesh Gazette, appoint:

Provided that different dates may be appointed for different provisions of

this Act and any reference in any such provisions to the commencement of this
Act shall be construed as a reference to the coming into force of that provision.

**2. Definitions –  In this Act, unless the context otherwise requires -**

(1) “actionable claim” shall have the same meaning

as assigned to it in section 3 of the Transfer of Property Act, 1882; (Act No.4 of
1882.)


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(2) “address of delivery” means the address of the recipient of goods or

services or both indicated on the tax invoice issued by a registered person for
delivery of such goods or services or both;

(3) “address on record” means the address of the recipient as available in

the records of the supplier;

(4) “adjudicating authority” means any authority, appointed or

authorised to pass any order or decision under this Act, but does not include
the Chief Commissioner, Revisional Authority, the Authority for Advance
Ruling, the Appellate Authority for Advance Ruling, [1][the Appellate Authority,
the Appellate Tribunal and the Authority referred to in sub-section (2) of
section 171;]

(5) “agent” means a person, including a factor, broker, commission

agent, arhatia, del credere agent, an auctioneer or any other mercantile agent,
by whatever name called, who carries on the business of supply or receipt of
goods or services or both on behalf of another;

(6) aggregate turnover” means the aggregate value of all taxable

supplies (excluding the value of inward supplies on which tax is payable by
a person on reverse charge basis), exempt supplies, exports of goods or services
or both and inter-sate supplies of persons having the same Permanent
Account Number, to be computed on all India basis but excludes central tax,
State tax, Union territory tax, integrated tax and cess;

(7) “agriculturist” means an individual or a Hindu Undivided Family

who undertakes cultivation of land
(a) by own labour, or

(b) by the labour of family, or

(c) by servants on wages payable in cash or kind or by hired
labour under personal supervision or the personal

supervision of any member of the family;

(8) “Appellate Authority” means an Authority appointed or authorised to

hear appeals and referred to in section 107;

(9) “Appellate Tribunal” means the Goods and Services Tax Appellate

Tribunal referred to in section 109;

(10) “appointed Day” means the date on which the provisions of this Act

shall come into force;

1
Subs. by Act 23 of 2018, S.2 (w.e.f. 1-2-2019)


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(11) “assessment” means determination of tax liability under this Act

and includes self- assessment, re-assessment, provisional assessment,
summary assessment and best judgement assessment;

(12) “associated Enterprises” shall have the same meaning asassigned to

it in section 92A of the Income-Tax Act, 1961; (Act No. 43 of 1961.)

(13) “audit” means the examination of records, returns and other

documents maintained or furnished by the registered person under this Act or
the rules made thereunder or under any other law for the time being in force to
verify the correctness of turnover declared, taxes paid, refund claimed and
input tax credit availed, and to assess his compliance with the provisions of
this Act or the rules made thereunder;

(14) “authorised bank” shall mean a bank or a branch of a bank

authorised by the Central Government to collect the tax or any other amount
payable under this Act;

(15)  “authorised representative” means the representative as referred to

under section 116;

(16) “Board” means the [1][Central Board of Indirect taxes and customs]

constituted under the Central Board of Revenue Act, 1963. (Act No.54of 1963).

(17) “business” includes,
(a) any trade, commerce, manufacture, profession, vocation,

adventure, wager or any other similar activity, whether or

not it is for a pecuniary benefit;

(b) any activity or transaction in connection with or incidental

or ancillary to sub-clause (a);

(c) any activity or transaction in the nature of sub-clause (a),

whether or not there is volume, frequency, continuity or

regularity of such transaction;

(d) supply or acquisition of goods including capital goods and

services in connection with commencement or closure of

business;

(e) provision by a club, association, society, or any such body

(for a subscription or any other consideration) of the

facilities or benefits to its members;

(f) admission, for a consideration, of persons to any

1
Subs. by Act 23 of 2018, S.2 (w.e.f. 1-2-2019)


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premises;

(g) services supplied by a person as the holder of an office

which has been accepted by him in the course or

furtherance of his trade, profession or vocation;

[1][(h) activities of a race club including by way of totalisator or

a license to book maker or activities of a licensed book
maker in such club; and;]

(i) any activity or transaction undertaken by the Central
Government, a State Government or any local authority in

which they are engaged as public authorities;

[2] *        *          *           *       *

(19) “capital goods” means goods, the value of which is capitalised in the

books of accounts of the person claiming the input tax credit and which are
used or intended to be used in the course or furtherance of business;

(20) “casual taxable Person” means a person who occasionally

undertakes transactions involving supply of goods or services or both in the
course or furtherance of business, whether as principal, agent or in any other
capacity, in the taxable territory where he has no fixed place of business;

(21) “central tax” means the Central goods and services tax levied under

section 9 of the Central Goods and Services Tax Act, 2017; (Act No.12 of 2017).

(22) “cess” shall have the same meaning as assigned to it in the Goods

and Services Tax (Compensation to States) Act, 2017; (Act No.15 of 2017).

(23) “chartered accountant” means a chartered accountant as defined in

clause (b) of sub-section (1) of section 2 of the Chartered Accountants Act,
1949; (Act No.38 of 2017).

(24) “Chief commissioner” means the Chief Commissioner of State tax

appointed under section 3 and includes the Commissioner of State Tax referred
to in the Central Goods and Services Tax Act,2017; (Act No.12 of 2017).

1
Subs. by Act 23 of 2018, S.2 (w.e.f. 1-2-2019)
2
Cl. (18) omitted by Act 23 of 2018, S.2 (w.e.f. 1-2-2019)


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(25) “Commissioner in the Board” means the Commissioner referred to

in section 168 of the Central Goods and Services Tax Act, 2017; (Act No.12 of
2017).

(26) “common portal” means the common goods and services tax

electronic portal referred to in section 146;

(27) “common Working Days” shall mean such days in succession which

are not declared as gazetted holidays by the Central Government or the
Government of Andhra Pradesh;

(28) “company secretary” means a company secretary as defined in

clause (c) of sub-section (1) of section 2 of the Company Secretaries Act, 1980;
(Act No.56 of 1980).

(29) “competent authority” means such authority as may be notified by

the Government;

(30) “composite supply” means a supply made by a taxable person to a

recipient consisting of two or more taxable supplies of goods or services or
both, or any combination thereof, which are naturally bundled and supplied in
conjunction with each other in the ordinary course of business, one of which is
a principal supply;

**Illustration: Where goods are packed and transported with insurance, the**
supply of goods, packing materials, transport and insurance is a composite
supply and supply of goods is a principal supply.

(31) “consideration” in relation to the supply of goods or services or both

includes;

(a) any payment made or to be made, whether in money or
otherwise, in respect of, in response to, or for the
inducement of, the supply of goods or services or both,
whether by the recipient or by any other person but shall
not include any subsidy given by the Central Government
or a State Government;

(b) the monetary value of any act or forbearance, in respect of,
in response to, or for the inducement of, the supply of goods
or services or both, whether by the recipient or by any other
person but shall not include any subsidy given by the
Central Government or a State Government:

Provided that a deposit given in respect of the supply

of goods or services or both shall not be considered as
payment made for such supply unless the supplier applies


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such deposit as consideration for the said supply;

(32) “continuous supply of goods” means a supply of goods which is

provided, or agreed to be provided, continuously or on recurrent basis, under a
contract, whether or not by means of a wire, cable, pipeline or other conduit,
and for which the supplier invoices the recipient on a regular or periodic basis
and includes supply of such goods as the Government may, subject to such
conditions, as it may, by notification, specify;

(33) “continuous supply of services” means a supply of services which is

provided, or agreed to be provided, continuously or on recurrent basis, under a
contract, for a period exceeding three months with periodic payment
obligations and includes supply of such services as the Government may,
subject to such conditions, as it may, by notification, specify;

(34) “conveyance” includes a vessel, an aircraft and a vehicle;

(35) “cost accountant” means a cost accountant as defined in [1][clause

(b)] of sub-section (1) of section 2 of the Cost and Works Accountants Act,
1959;

(36) “council” means the Goods and Services Tax Council established

under article 279A of the Constitution of India;

(37) “credit note” means a document issued by a registered person

under sub-section (1) of section 34;

(38) “debit note” means a document issued by a registered person under

sub-section (3) of section 34;

(39) “deemed exports” means such supplies of goods as may be notified

under section 147;

(40) “designated authority” means such authority as may be notified by

the Chief Commissioner;

(41) “document” includes written or printed record of any sort and

electronic record as defined in clause (t) of section 2 of the Information
Technology Act, 2000; (Act No.21 of 2000).

(42) “drawback” in relation to any goods manufactured in India and

exported, means the rebate of duty, tax or cess chargeable on any imported
inputs or on any domestic inputs or input services used in the manufacture of
such goods;

1
Subs. by Act 23 of 2018, S.2, for Clause C (w.e.f. 1-2-2019)


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(43) “electronic cash ledger” means the electronic cash ledger referred to

in sub-section (1) of section 49;

(44) “electronic Commerce” means the supply of goods or services or

both, including digital products over digital or electronic network;

(45) “electronic Commerce Operator” means any person who owns,

operates or manages digital or electronic facility or platform for electronic
commerce;

(46) “electronic Credit Ledger” means the electronic credit ledger referred

to in sub-section (2) of section 49;

(47) “exempt Supply” means supply of any goods or services or both

which attracts nil rate of tax or which may be wholly exempt from tax under
section 11, or under section 6 of the Integrated Goods and Services Tax Act,
2017 and includes non-taxable supply;

(48) “existing Law” means any law, notification, order, rule or regulation

relating to levy and collection of duty or tax or cess on goods or services or both
passed or made before the commencement of this Act by the Legislature or any
authority or person having the power to make such law, notification, order,
rule or regulation;

(49) “family” means,
(i) the spouse and children of the person, and

(ii) the parents, grand-parents, brothers and sisters of the

person if they are wholly or mainly dependent on the
said person;

(50) “fixed Establishment” means a place (other than the registered place

of business) which is characterised by a sufficient degree of permanence and
suitable structure in terms of human and technical resources to supply
services, or to receive and use services for its own needs;

(51) “Fund” means the Consumer Welfare Fund established under

section 57;

(52) “goods” means every kind of movable property other than money

and securities but includes actionable claim, growing crops, grass and things
attached to or forming part of the land which are agreed to be served before
supply or under a contract of supply;


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(53)  “Government” means the Government of Andhra Pradesh;

(54) “Goods and Services Tax (Compensation to States) Act” means the

Goods and Services Tax (Compensation to States) Act, 2017; (Act No.15 of
2017).

(55) “goods and services tax practitioner” means any person who has

been approved under section 48 to act as such practitioner;

(56) “India” means the territory of India as referred to in article 1 of the

Constitution of India, its territorial waters, seabed and sub-soil underlying
such waters, continental shelf, exclusive economic zone or any other maritime
zone as referred to in the Territorial Waters, Continental Shelf, Exclusive
Economic Zone and other Maritime Zones Act, 1976, and the air space above
its territory and territorial waters; (Act No.80 of 1976).

(57) “Integrated Goods and Services Tax Act” means the Integrated

Goods and Services Tax Act, 2017; (Act No.13 of 2017).

(58) “integrated Tax” means the integrated goods and services tax levied

under the Integrated Goods and Services Tax Act, 2017; (Act No.13 of 2017).

(59) “input” means any goods other than capital goods used or intended

to be used by a supplier in the course or furtherance of business;

(60)  “input Service” means any service used or intended to be used by a

supplier in the course or furtherance of business;

(61) “input Service distributor” means an office of the supplier of goods

or services or both which receives tax invoices issued under section 31 towards
the receipt of input services and issues a prescribed document for the purposes
of distributing the credit of central tax, State tax, integrated tax or Union
territory tax paid on the said services to a supplier of taxable goods or services
or both having the same Permanent Account Number as that of the said office;

(62) “input tax” in relation to a registered person, means the Central tax,

State Tax, integrated tax or Union Territory tax charged on any supply of goods
or services or both and includes,
(a) the integrated goods and services tax charged on import of

goods;

(b) the tax payable under the provisions of sub-sections (3) and

(4) of section 9;

(c) the tax payable under the provisions of sub-sections (3) and

(4) of section 5 of the Integrated Goods and Services Tax


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Act, 2017; (Act No.13 of 2017).

(d) the tax payable under the provisions of the Central Goods

and Services Tax Act, 2017. but does not include the tax

paid under the composition levy; (Act No.12 of 2017).

(63)  “input Tax Credit” means the credit of input tax;

(64) “intra-State supply of goods” shall have the same meaning as

assigned to it in section 8 of the Integrated Goods and Services Tax Act, 2017;
(Act No.13 of 2017).

(65) “intra-State Supply of Services” shall have the same meaning as

assigned to it in section 8 of the Integrated Goods and Services Tax Act, 2017;
(Act No.13 of 2017).

(66) “invoice” or “tax invoice” means the tax invoice referred to in section

31;

(67) “inward supply” in relation to a person, shall mean receipt of goods

or services or both whether by purchase, acquisition or any other means, with
or without consideration;

(68) “job work” means any treatment or process undertaken by a person

on goods belonging to another registered person and the expression “job
worker” shall be construed accordingly;

(69) “local authority” means,
(a) a “Panchayat” as defined in clause (d) of article 243 of the

Constitution of India;

(b) a “Municipality” as defined in clause (e) of article 243 P of the

Constitution of India;

(c) a Municipal Committee, a Zilla Praja Parishad, a District

Board, and any other authority legally entitled to, or
entrusted by the Central Government or any State
Government with the control or management of a municipal
or local funds;

(d) a Cantonment Board as defined in section 3 of the

Cantonments Act, 2006; (Act No.41 of 2006).

(e) a Regional Council or a District Council constituted under

the Sixth Schedule to the Constitution of India;


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(f) a Development Board constituted under article 371 [1][and

article 371J] of the Constitution of India; or

(g) a Regional Council constituted under article 371 A of the

Constitution of India;

(70) “location of the recipient of services” means,
(a) where a supply is received at a place of business for which
the registration has been obtained, the location of such
place of business;

(b) where a supply is received at a place other than the place of
business for which registration has been obtained (a fixed
establishment elsewhere), the location of such fixed
establishment;

(c) where a supply is received at more than one establishment,
whether the place of business or fixed establishment, the
location of the establishment most directly concerned with
the receipt of the supply; and

(d) in absence of such places, the location of the usual place of
residence of the recipient;

(71) “location of the supplier of services” means,
(a) where a supply is made from a place of business for which

the registration has been obtained, the location of such place
of business;

(b) where a supply is made from a place other than the place of

business for which registration has been obtained (a fixed
establishment elsewhere), the location of such fixed

establishment;

(c) where a supply is made from more than one establishment,

whether the place of business or fixed establishment, the
location of the establishment most directly concerned with
the provisions of the supply; and

(d) in absence of such places, the location of the usual place of

residence of the supplier;

1
Ins. by Act 23 of 2018, s.2 (w.e.f.1-2-2019)


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(72) “manufacture” means processing of raw material or inputs in any

manner that results in emergence of a new product having a distinct name,
character and use and the term “manufacturer” shall be construed accordingly;

(73) “market value” shall mean the full amount which a recipient of a

supply is required to pay in order to obtain the goods or services or both of like
kind and quality at or about the same time and at the same commercial level
where the recipient and the supplier are not related;

(74) “mixed supply” means two or more individual supplies of goods or

services, or any combination thereof, made in conjunction with each other by a
taxable person for a single price where such supply does not constitute a
composite supply.

**Illustration:- A supply of a package consisting of canned foods, sweets,**
chocolates, cakes, dry fruits, aerated drinks and fruit juices when supplied for
a single price is a mixed supply. Each of these items can be supplied separately
and is not dependent on any other. It shall not be a mixed supply if these items
are supplied separately;

(75) “money” means the Indian legal tender or any foreign currency,

cheque, promissory note, bill of exchange, letter of credit, draft, pay order,
traveller cheque, money order, postal or electronic remittance or any other
instrument recognized by the Reserve Bank of India when used as a
consideration to settle an obligation or exchange with Indian legal tender of
another denomination but shall not include any currency that is held for its
numismatic value;

(76) “motor vehicle” shall have the same meaning as assigned to it in

clause (28) of section 2 of the Motor Vehicles Act, 1988; (Act No.59 of 1988).

(77) “non-resident taxable person” means any person who occasionally

undertakes transactions involving supply of goods or services or both, whether
as principal or agent or in any other capacity, but who has no fixed place of
business or residence in India;

(78) “non-taxable supply” means a supply of goods or services or both

which is not leviable to tax under this Act, or under the Integrated Goods and
Services Tax Act, 2017; (Act No.13 of 2017).

(79) “non-taxable territory” means the territory which is outside the

taxable territory;

(80) “notification” means a notification published in the Andhra Pradesh


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Gazette and the expressions ‘notify’ and ‘notified’ shall be construed
accordingly;

(81) “other territory” includes territories other than those comprising in

a State and those referred to in sub-clauses (a) to (e) of clause (114);

(82) “output tax” in relation to a taxable person, means the tax

chargeable under this Act on taxable supply of goods or services or both made
by him or by his agent but excludes tax payable by him on reverse charge
basis;

(83) “outward supply” in relation to a taxable person, means supply of

goods or services or both, whether by sale, transfer, barter, exchange, licence,
rental, lease or disposal or any other mode, made or agreed to be made by such
person in the course or furtherance of business;

(84) “person” includes,
(a) an individual;

(b) a Hindu undivided family;

(c) a company;

(d) a firm;

(e) a Limited Liability Partnership;

(f) an association of persons or a body of individuals, whether

incorporated or not, in India or outside India;

(g) any corporation established by or under any Central Act, State

Act or Provincial Act or a Government company as defined in
clause (45) of section 2 of the Companies Act, 2013; (Act No.18
of 2013).

(h) anybody corporate incorporated by or under the laws of a

country outside India;

(i) a co-operative society registered under any law relating to

cooperative societies;


-----

(j) a local authority;

(k) Central Government or a State Government;

(l) society as defined under the Societies Registration Act, 1860;

(Act No.21 of 1860).

(m) trust; and

(n) every artificial juridical person, not falling within any of the

above;

(85)  “place of business” includes,
(a) a place from where the business is ordinarily carried on, and

includes a warehouse, a godown or any other place where a
taxable person stores his goods, supplies or receives goods or
services or both; or

(b) a place where a taxable person maintains his books of account;

or

(c) a place where a taxable person is engaged in business through

an agent, by whatever name called;

(86) “place of supply” means the place of supply as referred to in

Chapter V of the integrated Goods and Services Tax Act, 2017;

(87) “prescribed” means prescribed by rules made under this Act on the

recommendations of the Council;

(88) “principal” means a person on whose behalf an agent carries on the

business of supply or receipt of goods or services or both;

(89) “principal place of business” means the place of business specified

as the principal place of business in the certificate of registration;

(90) “principal supply” means the supply of goods or services which

constitutes the predominant element of a composite supply and to which any
other supply forming part of that composite supply is ancillary;


-----

(91) “proper officer” in relation to any function to be performed under

this Act, means the Chief Commissioner or the officer of the State tax who is
assigned that function by the Chief Commissioner;

(92) “quarter” shall mean a period comprising three consecutive

calendar months, ending on the last day of March, June, September and
December of a calendar year;

(93) “recipient” of supply of goods or services or both, means
(a) where a consideration is payable for the supply of goods or

services or both, the person who is liable to pay that
consideration;

(b) where no consideration is payable for the supply of goods, the

person to whom the goods are delivered or made available, or
to whom possession or use of the goods is given or made
available; and

(c) where no consideration is payable for the supply of a service,

the person to whom the service is rendered,

and any reference to a person to whom a supply is made

shall be construed as a reference to the recipient of the supply
and shall include an agent acting as such on behalf of the
recipient in relation to the goods or services or both supplied;

(94) “registered person” means a person who is registered under section

25 but does not include a person having a Unique Identity Number.

(95) “regulations” means the regulations made by the Government

under this Act on the recommendations of the Council;

(96) “removal” in relation to goods, means,
(a) despatch of the goods for delivery by the supplier thereof or by

any other person acting on behalf of such supplier; or

(b) collection of the goods by the recipient thereof or by any other

person acting on behalf of such recipient;

(97) “return” means any return prescribed or otherwise required to be

furnished by or under this Act or the rules made thereunder;

(98) “reverse charge’’ means the liability to pay tax by the recipient of

supply of goods or services or both instead of the supplier of such goods or
services or both under sub-section (3) or sub-section (4) of section 9, or under
sub-section (3) or sub-section (4) of section 5 of the Integrated Goods and
Services Tax Act, 2017; (Act No.13 of 2017).


-----

(99) “Revisional Authority” means an authority appointed or authorised

for revision of decision or orders as referred to in section 108;

(100) “schedule” means a Schedule appended to this Act;

(101) “Securities” shall have the same meaning as assigned to it in

clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956; (Act
No.42 of 1956).

(102) “services” means anything other than goods, money and securities

but includes activities relating to the use of money or its conversion by cash or
by any other mode, from one form, currency or denomination, to another form,
currency or denomination for which a separate consideration is charged;

1[Explanation.–– For the removal of doubts, it is hereby clarified that the
expression “services” includes facilitating or arranging transactions in
securities;]

(103) “State” means the State of Andhra Pradesh;

(104) “State tax” means the tax levied under this Act;

(105) “supplier” in relation to any goods or services or both, shall mean

the person supplying the said goods or services or both and shall include an
agent acting as such on behalf of such supplier in relation to the goods or
services or both supplied;

(106) “tax period’’ means the period for which the return is required to

be furnished;

(107) “taxable person” means a person who is registered or liable to be

registered under section 22 or section 24;

(108) “taxable supply’’ means a supply of goods or services or both

which is leviable to tax under this Act;

(109) “taxable territory’’ means the territory to which the provisions of

this Act apply;

(110) “telecommunication service” means service of any description

(including electronic mail, voice mail, data services, audio text services, video
text services, radio paging and cellular mobile telephone services) which is
made available to users by means of any transmission or reception of signs,
signals, writing, images and sounds or intelligence of any nature, by wire,
radio, visual or other electro-magnetic means;

1
Ins. by Act 23 of 2018, s.2(w.e.f. 1-2-2019)


-----

(111) “the Central Goods and Services Tax Act” means the Central

Goods and Services Tax Act, 2017; (Act No.12 of 2017).

(112) “turnover in State” or “turnover in Union Territory” means the

aggregate value of all taxable supplies (excluding the value of inward supplies
on which tax is payable by a person on reverse charge basis) and exempt
supplies made within a State or Union territory by a taxable person, exports of
goods or services or both and inter-State supplies of goods or services or both
made from the State or Union territory by the said taxable person but excludes
central tax, State tax, Union territory tax, integrated tax and cess;

(113) “usual place of residence” means
(a) in case of an individual, the place where he ordinarily

resides;

(b) in other cases, the place where the person is

incorporated or otherwise legally constituted;

(114)  “Union Territory” means

(a) the Andaman and Nicobar Islands;
(b) Lakshadweep;

(c) Dadra and nagar haveli;

(d) Daman and diu;

(e) Chandigarh; and

(f) Other territory;

**Exhalation : For the purposes of this Act each of the territories specified in**
sub-clauses (a) to (f) shall be considered to b separate Union Territory.

(115) “Union territory tax” means the Union territory goods and services

tax levied under the Union Territory Goods and Services Tax Act, 2017; (Act
No.14 of 2017).

(116) “Union Territory Goods and Services Tax Act” means the Union

Territory Goods and Services Tax Act, 2017; (Act No.14 of 2017).

(117) “valid return” means a return furnished under sub-section (1) of

section 39 on which self-assessed tax has been paid in full;

(118) “voucher” means an instrument where there is an obligation to

accept it as consideration or part consideration for a supply of goods or
services or both and where the goods or services or both to be supplied or the


-----

identities of their potential suppliers are either indicated on the instrument
itself or in related documentation, including the terms and conditions of use of
such instrument;

(119) “works contract” means a contract for building, construction,

fabrication, completion, erection, installation, fitting out, improvement,
modification, repair, maintenance, renovation, alteration or commissioning of
any immovable property wherein transfer of property in goods, whether as
goods or in some other form, is involved in the execution of such contract;

(120) Words and expressions used and not defined in this Act but

defined in the Integrated Goods and Services Tax Act, 2017 the Central Goods
and Services Tax Act, 2017 and the Goods and Services Tax (Compensation to
States) Act, 2017 shall have the same meanings as assigned to them in those
Acts. (Act No.13 of 2017), (Act No.12 of 2017) and (Act No.15 of 2017).

**CHAPTER II**

**ADMINISTRATION**

**3. Officers under this Act.-The Government shall, by notification, appoint the**

following classes of officers for the purposes of this Act, namely:
(a) Chief Commissioner of State Tax,

(b) Commissioners of State Tax,

(c) Additional Commissioners of State Tax,

(d) Joint Commissioners of State Tax,

(e) Deputy Commissioners of State Tax,

(f) Assistant Commissioners of State Tax,

(g) Deputy Assistant Commissioners of State Tax,

(h) Goods and Services Tax officers, and

(i) any other class of officers as it may deem fit:

Provided that the officers appointed under the Andhra Pradesh Value

Added Tax Act, 2005 shall be deemed to be the officers appointed under the
provisions of this Act. (Act No.5 of 2005).

**4. Appointment of officers-** (1) The Government may, in addition to the
officers as may be notified by the Government under section 3, appoint such
persons as it may think fit to be the officers under this Act.


-----

(2) The Chief Commissioner shall have jurisdiction over the whole of the State,
the Commissioner and an Additional Commissioner in respect of all or any of
the functions assigned to them, shall have jurisdiction over the whole of the
State or where the State Government so directs, over any local area thereof,
and all other officers shall, subject to such conditions as may be specified,
have jurisdiction over the whole of the State or over such local areas as the
Chief Commissioner may, by order, specify.

**5. Powers of officers-** (1) Subject to such conditions and limitations as the
Chief Commissioner may impost, an officer of State Tax may exercise the
powers and discharge the duties conferred or imposed on him under this Act.

(2) An officer of State tax may exercise the powers and discharge the

duties conferred or imposed under this Act on any other officer of State tax
who is subordinate to him.

(3) The Chief Commissioner may, subject to such conditions and

limitations as may be specified in this behalf by him, delegate his powers to
any other officer who is subordinate to him.

(4) Notwithstanding anything contained in this section, an Appellate

Authority shall not exercise the powers and discharge the duties conferred or
imposed on any other officer of State tax.

**6. Authorization of officers of central tax as proper officer in certain**
**circumstances- (1) Without prejudice to the provisions of this Act, the officers**
appointed under the Central Goods and Services Tax Act, 2017 are authorised
to be the proper officers for the purposes of this Act, subject to such conditions
as the Government shall, on the recommendations of the Council, by
notification, specify.

(2) Subject to the conditions specified in the notification issued under

sub-section (1),
(a) where any proper officer issues an order under this Act, he shall
also issue an order under the Central Goods and Services Tax
Act, 2017 as authorised by the said Act under intimation to the
jurisdictional officer of central tax; (Act No.12 of 2017).

(b) where a proper officer under the Central Goods and Services Tax
Act, 2017 has initiated any proceedings on a subject matter, no
proceedings shall be initiated by the proper officer under this Act
on the same subject matter. (Act No.12 of 2017).


-----

(3) Any proceedings for rectification, appeal and revision, wherever

applicable, of any order passed by an officer appointed under this Act, shall not
lie before an officer appointed under the Central Goods and Services Tax Act,
2017. (Act No.12 of 2017).

**CHAPTER III**

**LEVY AND COLLECTION OF TAX**

**7. Scope of supply-**

(1) For the purposes of this Act, the expression “supply” includes,
(a) all forms of supply of goods or service or both such as sale,
transfer, barter, exchange, license, rental, lease or disposal
made or agreed to be made for a consideration by a person in the
course or furtherance of business;

(b) import of services for a consideration whether or not in the
course or furtherance of business [1][and];

(c) the activities specified in Schedule I, made or agreed to be made
without a consideration;   [2]*  *  *

[3]*      *    *     *    *    *    *     *

4[(1A) where certain activities or transactions constitute a supply in accordance
with the provisions of sub-section (1), they shall be treated either as supply of
goods or supply of services as referred to in Schedule II.]

(2) Notwithstanding anything contained in sub-section (1),
(a) activities or transactions specified in Schedule III; or

(b) such activities or transactions undertaken by the Central
Government, a State Government or any local authority in which
they are engaged as public authorities, as may be notified by the
Government on the recommendations of the Council, shall be
treated neither as a supply of goods nor a supply of services.

(3) Subject to the provisions of sub-sections [5][(1), (1A) and (2)], the

Government may, on the recommendations of the Council, specify, by
notification, the transactions that are to be treated as,
(a) a supply of goods and not as a supply of services; or

1
The word “and” inserted, shall always be deemed to have been inserted by Act 23 of 2018, s.3, (w.e.f. 1-7-2017)
2
The word “and” omitted, shall always be deemed to have been omitted by Act 23 of 2018, s.3, (w.e.f. 1-7-2017)
3
Clause (d) omitted, shall always be deemed to have been omitted, by Act 23 of 2018, s.3 (w.e.f. 1-7-2017)
4
Ins. by Act 23 of 2018, s.3 (w.e.f. 1-7-2017)
5
Ins. (1A) by Act 23 of 2018, s.3 (w.e.f. 1-7-2017)


-----

(b) a supply of services and not as a supply of goods.

**8. Tax liability on composite and mixed supplies-** The tax liability on a
composite or a mixed supply shall be determined in the following manner,
namely:

(a) a composite supply comprising two or more supplies, one of

which is a principal supply, shall be treated as a supply of such
principal supply; and

(b) a mixed supply comprising two or more supplies shall be treated

as a supply of that particular supply which attracts the highest
rate of tax.

**9. Levy and collection- (1) Subject to the provisions of sub-section (2), there**
shall be levied a tax called the Andhra Pradesh goods and services tax on all
intra-State supplies of goods or services or both, except on the supply of
alcoholic liquor for human consumption, on the value determined under
section 15, and at such rates, not exceeding twenty percent, as may be notified
by the Government, on the recommendations of the Council and collected in
such manner as may be prescribed and shall be paid by the taxable person.

(2) The State tax on the supply of petroleum crude, high speed diesel,

motor spirit (commonly known as petrol), natural gas and aviation turbine fuel,
shall be levied with effect from such date as may be notified by the Government
on the recommendations of the Council.

(3) The Government may, on the recommendations of the Council, by

notification, specify categories of supply of goods or services or both, the tax on
which shall be paid on reverse charge basis by the recipient of such goods or
services or both and all the provisions of this Act shall apply to such recipient
as if he is the person liable for paying the tax in relation to the supply of such
goods or services or both.

1[(4) The Government may, on the recommendations of the Council, by

notification, specify a class of registered persons who shall, in respect of supply of
specified categories of goods or services or both received from an unregistered
supplier, pay the tax on reverse charge basis as the recipient of such supply of
goods or services or both, and all the provisions of this Act shall apply to such
recipient as if he is the person liable for paying the tax in relation to such supply of
goods or services or both.]

(5) The Government may, on the recommendations of the Council, by

notification, specify categories of services the tax on intra-State supplies of
which shall be paid by the electronic commerce operator if such services are

1
Subs. by Act 23 of 2018, s.4 (w.e.f. 1-2-2019)


-----

supplied through it, and all the provisions of this Act shall apply to such
electronic commerce operator as if he is the supplier liable for paying the tax in
relation to the supply of such services:

Provided that where an electronic commerce operator does not have a

physical presence in the taxable territory, any person representing such
electronic commerce operator for any purpose in the taxable territory shall be
liable to pay tax:

Provided further that where an electronic commerce operator does not

have a physical presence in the taxable territory and also he does not have a
representative in the said territory, such electronic commerce operator shall
appoint a person in the taxable territory for the purpose of paying tax and such
person shall liable to pay tax.

**10. Composition levy- (1) Notwithstanding anything to the contrary contained**
in this Act but subject to the provisions of sub-sections (3) and (4) of section 9,
a registered person, whose aggregate turnover in the preceding financial year
did not exceed fifty lakh rupees may opt to pay, [1][in lieu of the tax payable by
him under sub-section (1) of section 9, an amount of tax calculated at such
rate] as may be prescribed, but not exceeding,
(a) on percent of the turnover in State in case of manufacturer,

(b) two and a half percent of the turnover in State in case of persons

engaged in making supplies referred to in clause (b) of paragraph 6 of
Schedule II, and

(c) half percent of the turnover in State in case of other suppliers,

subject to such conditions and restrictions as may be prescribed:

Provided that the Government may, by notification, increase the

said limit of fifty lakh rupees to such higher amount, not exceeding
2[one crore and fifty lakh rupees], as may be recommended by the
Council.

3[Provided further that a person who opts to pay tax under clause

(a) or clause (b) or clause (c) may supply services (other than those
referred to in clause (b) of paragraph 6 of Schedule II), of value not
exceeding ten per cent of turnover in the State in the preceding
financial year or five lakh rupees, whichever is higher.]

1 Subs. by Act 23 of 2018, s.5 (w.e.f. 1-2-2019)
2 Subs. by Act 23 of 2018, s.5 for the words “one crore rupees” (w.e.f. 1-2-2019)
3 Added by Act 23 of 2018, s.5 (w.e.f. 1-2-2019)


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(2)  the registered person shall be eligible to opt under sub-section (1), if
1[(a) save as provided in sub-section (1), he is not engaged in the
supply of services;]

(b) he is not engaged in making any supply of goods which are
not leviable to tax under this Act;

(c) he is not engaged in making any inter-State outward
supplies of goods;

(d) he is not engaged in making any supply of goods through an
electronic commerce operator who is required to collect tax at
source under section 52; and

(e) he is not a manufacturer of such goods as may be notified by
the Government on the recommendations of the Council:

Provided that where more than one registered person are having

the same Permanent Account Number (issued under the Income-Tax Act,
1961), the registered person shall not be eligible to opt for the scheme under
sub-section (1) unless all such registered persons opt to pay tax under that
sub-section. (Act No.43 of 1961).

(3) the option availed of by a registered person under sub-section (1)

shall lapse with effect from the day on which his aggregate turnover during a
financial year exceeds the limit specified under sub-section (1).

(4) A taxable person to whom the provisions of sub-section (1) apply

shall not collect any tax from the recipient on supplies made by him nor shall
he be entitled to any credit of input tax.

(5) If the proper officer has reasons to believe that a taxable person has

paid tax under sub-section (1) despite not being eligible, such person shall, in
addition to any tax that may be payable by him under any other provisions of
this Act, be liable to a penalty and the provisions of section 73 or section 74
shall, mutatis mutandis, apply for determination of tax and penalty.

**11. Power to grant exemption from tax-** (1) Where the Government is
satisfied that it is necessary in the public interest so to do, it may, on the
recommendations of the Council, by notification, exempt generally, either
absolutely or subject to such conditions as may be specified therein, goods or
services or both of any specified description from the whole or any part of the

1
Subs. by Act 23 of 2018, s.5 (w.e.f. 1-2-2019)


-----

tax leviable thereon with effect from such date as may be specified in such
notification.

(2) Where the Government is satisfied that it is necessary in the public

interest so to do, it may, on the recommendations of the Council, by special
order in each case, under circumstances of an exceptional nature to be stated
in such order, exempt from payment of tax any goods or services or both on
which tax is leviable.

(3) The Government may, if it considers necessary or expedient so to do

for the purpose of clarifying the scope or applicability of any notification issued
under sub-section (1) or order issued under sub-section (2), insert an
explanation in such notification or order, as the case may be, by notification at
any time within one year of issue of the notification under sub-section (1) or
order under sub-section (2), and every such explanation shall have effect as if
it had always been the part of the first such notification or order, as the case
may be.

(4) Any notification issued by the Central Government under sub-section

(1) of section 11 or order issued under sub-section (2) of the said section of the
Central Goods and Services Tax Act, 2017 shall be deemed to be a notification
or, as the case may be, an order issued under this Act. (Act No.12 of 2017).

**Explanation:-** For the purposes of this section, where an exemption in

respect of any goods or services or both from the whole or part of the tax
leviable thereon has been granted absolutely, the registered person supplying
such goods or services or both shall not collect the tax, in excess of the
effective rate, on such supply of goods or services or both.

**CHAPETER IV**

**TIME AND VALUE OF SUPPLY**

**12. Time of supply of goods- (1) The liability to pay tax on goods shall arise at**
the time of supply, as determined in accordance with the provisions of this
section.

(2) The time of supply of goods shall be the earlier of the following dates,

namely:

-----

(a) the date of issue of invoice by the supplier or the last date on
which he is required, under [1]* * * * * section 31, to issue the
invoice with respect to the supply; or

(b) the date on which the supplier receives the payment with
respect to the supply:

Provided that where the supplier of taxable goods receives an

amount up to one thousand rupees in excess of the amount indicated in the
tax invoice, the time of supply to the extent of such excess amount shall, at the
option of the said supplier, be the date of issue of invoice in respect of such
excess amount.

**Explanation I:-** For the purposes of clauses (a) and (b), “supply” shall be

deemed to have been made to the extent it is covered by the invoice or, as the
case may be, the payment.

**Explanation II:- For the purposes of clause (b), “the date on which the**
supplier receives the payment” shall be the date on which the payment is
entered in his books of account or the date on which the payment is credited to
his bank account, whichever is earlier.

(3) In case of supplies in respect of which tax is paid or liable to be paid

on reverse charge basis, the time of supply shall be the earliest of the following
dates, namely:
(a) the date of the receipt of goods; or

(b) the date of payment as entered in the books of account of the
recipient or the date on which the payment is debited in his
bank account, whichever is earlier; or

(c) the date immediately following thirty days from the date of
issue of invoice or any other document, by whatever name
called, in lieu thereof by the supplier:

Provided that where it is not possible to determine the time of supply

under clause (a) or clause (b) or clause (c), the time of supply shall be the date
of entry in the books of account of the recipient of supply.

(4) In case of supply of vouchers by a supplier, the time of supply

shall be,
1
The word “sub-section (1) of” omitted by Act 23 of 2018, s.6 (w.e.f. 1-2-2019)


-----

(a) the date of issue of voucher, if the supply is identifiable at that
point; or

(b) the date of redemption of voucher, in all other cases.

(5) Where it is not possible to determine the time of supply under the

provisions of sub-section (2) or sub-section (3) or sub-section (4), the time of
supply shall,
(a) in a case where a periodical return has to be filed, be the date
on which such return is to be filed, or

(b) in any other case, be the date on which the tax is paid.

(6) The time of supply to the extent it relates to an addition in the value

of supply by way of interest, late fee or penalty for delayed payment of any
consideration shall be the date on which the supplier receives such addition in
value.

**13. Time of supply of services- (1) The liability to pay tax on services shall**
arise at the time of supply, as determined in accordance with of the provisions
of this section.

(2) The time of supply of services shall be the earliest of the following

dates, namely:
(a) the date of issue of invoice by the supplier, if the invoice is
issued within the period prescribed under  [1]* * * * * * section
31 or the date of receipt of payment, whichever is earlier; or

(b) the date of provision of service, if the invoice is not issued
within the period prescribed under  [2]* * * * * * section 31 or
the date of receipt of payment, whichever is earlier; or

(c) the date on which the recipient shows the receipt of services
in his books of account, in a case where the provisions of
clause (a) or clause (b) do not apply:

Provided that where the supplier of taxable service receives and amount

upto one thousand rupees in excess of the amount indicated in the tax invoice,
the time of supply to the extent of such excess amount shall, at the option of

1
The word “sub-section (2) of” omitted by Act 23 of 2018, s.7 (w.e.f. 1-2-2019)
2
The word “sub-section (2) of” omitted by Act 23 of 2018, s.7 (w.e.f. 1-2-2019)


-----

the said supplier, be the date of issue of invoice relating to such excess
amount.

**Explanation:- For the purposes of clauses (a) and (b),-**

(i) the supply shall be deemed to have been made to the extent it is

covered by the invoice or, as the case may be, the payment;

(ii) “the date of receipt of payment” shall be the date on which the

payment is entered in the books of account of the supplier or the date
on which the payment is credited to his bank account, whichever is
earlier.

(3) In case of supplies in respect of which tax is paid or liable to the

paid on reverse charge basis, the time of supply shall be the earlier of the
following dates, namely,
(a) the date of payment as entered in the books of account of the

recipient or the date on which the payment is debited in his bank
account, whichever is earlier; or

(b) the date immediately following sixty days from the date of issue of

invoice or any other document, by whatever name called, in lieu
thereof by the supplier:

Provided that where it is not possible to determine the time of supply

under clause (a) or clause (b), the time of supply shall be the date of entry in
the books of account of the recipient of supply:

Provided further that in case of supply by associated enterprises, where

the supplier of service is located outside India, the time of supply shall be the
date of entry in the books of account of the recipient of supply or the date of
payment, whichever is earlier.

(4) In case of supply of vouchers, by a supplier, the time of supply shall

be,
(a) the date of issue of voucher, if the supply is identifiable at that

point; or

(b) the date of redemption of voucher, in all other cases;

(5) Where it is not possible to determine the time of supply of services in

the manner specified in sub-section (2), sub-section (3) or sub-section (4), the
time of supply shall,

-----

(a) in a case where a periodical return has to be filed, be the date

on which such return is to be filed; or

(b) in any other case, be the date on which the tax is paid.

(6) The time of supply to the extent it relates to an addition in the value

of supply by way of interest, late fee or penalty for delayed payment of any
consideration shall be the date on which the supplier receives such addition in
value.

**14. Change in rate of tax in respect of supply of goods or services-**
Notwithstanding anything contained in section 12 or section 13, the time of
supply, where there is a change in the rate of tax in respect of goods or services
or both, shall be determined in the following manner, namely:
(a) in case the goods or services or both have been supplied

before the change in rate of tax,
(i) where the invoice for the same has been issued and the

payment is also received after the change in rate of tax, the
time of supply shall be the date of receipt of payment or the
date of issue of invoice, whichever is earlier; or

(ii) where the invoice has been issued prior to the change in rate

of tax but payment is received after the change in rate of tax,
the time of supply shall be the date of issue of invoice; or

(iii) where the payment has been received before the change in

rate of tax, but the invoice for the same is issued after the
change in rate of tax, the time of supply shall be the date of
receipt of payment;

(b) in case the goods or services or both have been supplied after

the change in rate of tax,
(i) where the payment is received after the change in rate of tax

but the invoice has been issued prior to the change in rate of
tax, the time of supply shall be the date of receipt of
payment; or

(ii) where the invoice has been issued and payment is received

before the change in rate of tax, the time of supply shall be
the date of receipt of payment or date of issue of invoice,
whichever is earlier; or

(i) where the invoice has been issued after the change in rate of

tax but the payment is received before the change in rate of
tax, the time of supply shall be the date of issue of invoice:


-----

Provided that the date of receipt of payment shall be the date of credit in

the bank account if such credit in the bank account is after four working days
from the date of change in the rate of tax.

**Explanation:-** For the purposes of this section, “the date of receipt of

payment” shall be the date on which the payment is entered in the books of
accounts of the supplier or the date on which the payment is credited to his
bank account, whichever is earlier.

**15. Value of taxable supply- (1)** The value of a supply of goods or services

or both shall be the transaction value, which is the price actually paid or
payable for the said supply of goods or services or both where the supplier and
the recipient of the supply are not related and the price is the sole
consideration for the supply.

(2) The value of supply shall include,
(a) any taxes, duties, cesses, fees and charges levied under any law

for the time being in force other than this Act, the Central
Goods and Services Tax Act, 2017 and the Goods and Services
Tax (Compensation to States) Act, 2017 if charged separately by
the supplier; (Act No.12 of 2017, Act No.15 of 2017).

(b) any amount that the supplier is liable to pay in relation to such
supply but which has been incurred by the recipient of the
supply and not included in the price actually paid or payable
for the goods or services or both;

(c) incidental expenses, including commission and packing,
charged by the supplier to the recipient of a supply, and any
amount charged for anything done by the supplier in respect of
the supply of goods or services or both at the time of, or before
delivery of goods or supply of services;

(d) interest or late fee or penalty for delayed payment of any
consideration for any supply; and

(e) subsidies directly linked to the price excluding subsidies
provided by the Central Government and State Government.

**Explanation:- For the purposes of this sub-section, the amount of subsidy**
shall be included in the value of supply of the supplier who receives the
subsidy.

(3) The value of the supply shall not include any discount which is

given,

-----

(a) before or at the time of the supply if such discount has been
duly recorded in the invoice issued in respect of such supply;
and

(b) after the supply has been effected, if,
(i) such discount is established in terms of an agreement
entered into at or before the time of such supply and
specifically linked to relevant invoices; and

(ii) input tax credit as is attributable to the discount on the
basis of document issued by the supplier has been
reversed by the recipient of the supply.

(4) Where the value of the supply of goods or services or both cannot be

determined under sub-section (1), the same shall be determined in such
manner as may be prescribed.

(5) Notwithstanding anything contained in sub-section (1) or sub-section

(4), the value of such supplies as may be notified by the Government on the
recommendations of the Council shall be determined in such manner as may
be prescribed.

**Explanation:- For the purposes of this Act,-**

(a) persons shall be deemed to be “related persons” if,
(i) such persons are officers or directors of one another’s
business;

(ii) such persons are legally recognized partners in business;

(iii) such persons are employer and employee;

(iv) any person directly or indirectly owns, controls or holds

twenty five percent or more of the outstanding voting stock
or shares of both of them;

(v) one of them directly or indirectly controls the other;

(vi) both of them are directly or indirectly controlled by a third

person;

(vii) together they directly or indirectly control a third person;

or

(viii) they are members of the same family;


-----

(b) the term “person” also includes legal persons.

(c) persons who are associated in the business of one another in

that one is the sole agent or sole distributor or sole
concessionaire, howsoever described, of the other, shall be
deemed to be related.

**CHAPTER V**

**INPUT TAX CREDIT**

**16. Eligibility and conditions for taking input tax credit-**

(1) Every registered person shall, subject to such conditions and

restrictions as may be prescribed and in the manner specified in section 49, be
entitled to take credit of input tax charged on any supply of goods or services
or both to him which are used or intended to be used in the course or
furtherance of his business and the said amount shall be credited to the
electronic credit ledger of such person.

(2) Notwithstanding anything contained in this section, no registered

person shall be entitled to the credit of any input tax in respect of any supply
of goods or services of both to him unless,
(a) he is in possession of a tax invoice or debit note issued by a

supplier registered under this Act, or such other taxpaying
documents as may be prescribed;

(b) he has received the goods or services or both.

[1][Explanation.—For the purposes of this clause, it shall be deemed
that the registered person has received the goods or, as the case may
be, services––

_(i)_ where the goods are delivered by the supplier to a
recipient or any other person on the direction of such
registered person, whether acting as an agent or
otherwise, before or during movement of goods, either
by way of transfer of documents of title to goods or
otherwise;

_(ii)_ where the services are provided by the supplier to any
person on the direction of and on account of such
registered person.]

1
Subs. by Act 23 of 2018, s.8 (w.e.f. 1-2-2019)


-----

(c) subject to the provisions of [1][section 41 or section 43A], the tax
charged in respect of such supply has been actually paid to
the Government, either in cash or through utilization of input
tax credit admissible in respect of the said supply; and

(d) he has furnished the return under section 39:

Provided that where the goods against an invoice are received in lots or

instalments, the registered person shall be entitled to take credit upon receipt
of the last lot or instalment:

Provided further that where a recipient fails to pay to the supplier of

goods or services or both, other than the supplies on which tax is payable on
reverse charge basis, the amount towards the value of supply along with tax
payable thereon within a period of one hundred and eighty days from the date
of issue of invoice by the supplier, an amount equal to the input tax credit
availed by the recipient shall be added to his output tax liability, along with
interest thereon, in such manner as may be prescribed:

Provided also that the recipient shall be entitled to avail of the credit of

input tax on payment made by him of the amount towards the value of supply
of goods or services or both along with tax payable thereon.

(3) Where the registered person has claimed depreciation on the tax

component of the cost of capital goods and plant and machinery under the
provisions of the Income-Tax Act, 1961, the input tax credit on the said tax
component shall not be allowed. (Act No.43 of 1961).

(4) A registered person shall not be entitled to take input tax credit in

respect of any invoice or debit note for supply of goods or services or both after
due date of furnishing of the return under section 39 for the month of
September following the end of financial year to which such invoice or invoice
relating to such debit note pertains or furnishing of the relevant annual return,
whichever is earlier.

**17.** **Apportionment of credit and blocked credits-**

(1) Where the goods or services or both are used by the registered

person partly for the purpose of any business and partly for other purposes,
the amount of credit shall be restricted to so much of the input tax as is
attributable to the purposes of his business.

(2) Where the goods or services or both are used by the registered person

partly for effecting taxable supplies including zero-rated supplies under this

1
Subs. by Act 23 of 2018, s.8, for the expression “section 41”(w.e.f. 1-2-2019)


-----

Act or under the Integrated Goods and Services Tax Act, 2017 and partly for
effecting exempt supplies under the said Acts, the amount of credit shall be
restricted to so much of the input tax as is attributable to the said taxable
supplies including zero-rated supplies.

(3) The value of exempt supply under sub-section (2), shall be such as

may be prescribed, and shall include supplies on which the recipient is liable
to pay tax on reverse charge basis, transactions in securities, sale of land and,
subject to clause (b) of paragraph 5 of Schedule II, sale of building;

**1[Explanation—For the purposes of this sub-section, the expression**
‘‘value of exempt supply’’ shall not include the value of activities or
transactions specified in Schedule III, except those specified in
paragraph 5 of the said Schedule.]

(4) A banking company or a financial institution including a non
banking financial company, engaged in supplying services by way of accepting
deposits, extending loans or advances shall have the option to either comply
with the provisions of sub-section (2), or avail of, every month, an amount
equal to fifty percent of the eligible input tax credit on inputs, capital goods
and input services in that month and the rest shall lapse:

Provided that the option once exercised shall not be withdrawn during

the remaining part of the financial year:

Provided further that the restriction of fifty percent, shall not apply to the

tax paid on supplies made by one registered person to another registered
person having the same Permanent Account Number.

(5) Notwithstanding anything contained in sub-section (1) of section 16

and sub-section (1) of section 18, input tax credit shall not be available in
respect of the following, namely:
[2][(a) motor vehicles for transportation of persons having approved

seating capacity of not more than thirteen persons (including the
driver), except when they are used for making the following taxable
supplies, namely:
_(A) further supply of such motor vehicles; or_

1
Ins. by Act 23 of 2018, s.9

2
Subs. by Act 23 of 2018, s.9,for Sub-Clauses (a) and (b)


-----

(B) transportation of passengers; or

(C) imparting training on driving such motor

vehicles;

(aa) vessels and aircraft except when they are used––

(i) for making the following taxable supplies, namely:—
(A) further supply of such vessels or aircraft; or

(B) transportation of passengers; or
(C) imparting training on navigating such vessels; or

(D) imparting training on flying such aircraft;
(ii) for transportation of goods;

(ab) services of general insurance, servicing, repair and
maintenance in so far as they relate to motor vehicles, vessels or
aircraft referred to in clause (a) or clause (aa):

Provided that the input tax credit in respect of such services shall
be available—

_(i)_ where the motor vehicles, vessels or aircraft referred to in clause

(a) or clause (aa) are used for the purposes specified therein;

_(ii)_ where received by a taxable person engaged—

(I ) in the manufacture of such motor vehicles,
vessels or aircraft; or

(II ) in the supply of general insurance services in respect of such

motor vehicles, vessels or aircraft insured by him;

(b) the following supply of goods or services or both:
(i) food and beverages, outdoor catering, beauty treatment, health
services, cosmetic and plastic surgery, leasing, renting or hiring of
motor vehicles, vessels or aircraft referred to in clause (a) or clause
(aa) except when used for the purposes specified therein, life
insurance and health insurance:

Provided that the input tax credit in respect of such goods
or services or both shall be available where an inward supply of such
goods or services or both is used by a registered person for making
an outward taxable supply of the same category of goods or services
or both or as an element of a taxable composite or mixed supply;


-----

(ii) membership of a club, health and fitness centre; and

(iii) travel benefits extended to employees on vacation such as leave
or home travel concession:

Provided that the input tax credit in respect of such goods or
services or both shall be available, where it is obligatory for an
employer to provide the same to its employees under any law for
the time being in force.]

(c) works contract services when supplied for construction of an

immovable property (other than plant and machinery) except
where it is an input service for further supply of works contract
service;

(d) goods or services or both received by a taxable person for

construction of an immovable property (other than plant or
machinery) on his own account including when such goods or
services or both are used in the course or furtherance of
business;

**Explanation:- For the purposes of clause (c) and (d), the expression**
“construction” includes re-construction, renovation, additions or alterations or
repairs, to the extent of capitalization, to the said immovable property,
(e) goods or services or both on which tax has been paid under

section 10;

(f) goods or services or both received by a non-resident taxable

person except on goods imported by him;

(g) goods or services or both used for personal consumption;

(h) goods lost, stolen, destroyed, written off or disposed of by way of

gift or free samples; and

(i) any tax paid in accordance of sections 74, 129 and 130.

(6) The Government may prescribe the manner in which the credit

referred to in sub-sections (1) and (2) may be attributed.

**Explanation:-** For the purposes of this Chapter and Chapter VI, the

expression “plant and machinery” means apparatus, equipment, and


-----

machinery fixed to earth by foundation or structural support that are used for
making outward supply of goods or services or both and includes such
foundation and structural supports but excludes,
(i) land, building or any other civil structures;

(ii) telecommunication towers; and

(iii) pipelines laid outside the factory premises.

**18. Availability of credit in special circumstances-**

(1) Subject to such conditions and restrictions as may be prescribed,
(a) a person who has applied for registration under this Act within

thirty days from the date on which he becomes liable to
registration and has been granted such registration shall be
entitled to take credit of input tax in respect of inputs held in
stock and inputs contained in semi-finished or finished goods
held in stock on the day immediately preceding the date from
which he becomes liable to pay tax under the provisions of this
Act.

(b) a person who takes registration under sub-section (3) of section

25 shall be entitled to take credit of input tax in respect of inputs
held in stock and inputs contained in semi-finished or finished
goods held in stock on the day immediately preceding the date of
grant of registration;

(c) where any registered person ceases to pay tax under section 10,

he shall be entitled to take credit of input tax in respect of inputs
held in stock, inputs contained in semi-finished or finished goods
held in stock and on capital goods on the day immediately
preceding the date from which he becomes liable to pay tax
under section 9:

Provided that the credit on capital goods shall be reduced by such

percentage points as may be prescribed;

(d) where an exempt supply of goods or services or both by a

registered person becomes a taxable supply, such person shall be
entitled to take credit of input tax in respect of inputs held in
stock and inputs contained in semi-finished or finished goods
held in stock relatable to such exempt supply and on capital
goods exclusively used for such exempt supply on the day


-----

immediately preceding the date from which such supply becomes
taxable:

Provided that the credit on capital goods shall be reduced by such

percentage points as may be prescribed.

(2) A registered persons shall not be entitled to take input tax credit

under sub-section (1) in respect of any supply of goods or services or both to
him after the expiry of one year from the date of issue of tax invoice relating to
such supply.

(3) Where there is a change in the constitution of a registered person on

account of sale, merger, demerger, amalgamation, lease or transfer of the
business with the specific provisions for transfer of liabilities, the said
registered person shall be allowed to transfer the input tax credit which
remains unutilised in his electronic credit ledger to such sold, merged,
demerged, amalgamated, leased or transferred business in such manner as
may be prescribed.

(4) Where any registered person who has availed of input tax credit opts

to pay tax under section 10 or, where the goods or services or both supplied by
him become wholly exempt, he shall pay an amount, by way of debit in the
electronic credit ledger or electronic cash ledger, equivalent to the credit of
input tax in respect of inputs held in stock and inputs contained in semifinished or finished goods held in stock and on capital goods, reduced by such
percentage points as may be prescribed, on the day immediately preceding the
date of exercising of such option or, as the case may be, the date of such
exemption.

Provided that after payment of such amount, the balance of input tax

credit, if any, lying in his electronic credit ledger shall lapse.

(5) The amount of credit under sub-section (1) and the amount payable

under sub-section (4) shall be calculated in such manner as may be
prescribed.

(6) In case of supply of capital goods or plant and machinery, on which

input tax credit has been taken, the registered person shall pay an amount
equal to the input tax credit taken on the said capital goods or plant and
machinery reduced by such percentage points as may be prescribed or the tax
on the transaction value of such capital goods or plant and machinery
determined under section 15, whichever is higher:

Provided that where refractory bricks, moulds and dies, jigs and fixtures

are supplied as scrap, the taxable person may pay tax on the transaction value
of such goods determined under section 15.


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**19.** **Taking input tax credit in respect of inputs sent for job work and**

**capital goods-** (1) The principal shall, subject to such conditions and
restrictions as may be prescribed, be allowed input tax credit on inputs sent to
a job-worker for job-work.

(2) Notwithstanding anything contained in clause (b) of sub-section (2)

of section 16, the principal shall be entitled to take credit of input tax on
inputs even if the inputs are directly sent to a job worker for job-work without
being first brought to his place of business.

(3) Where the inputs sent for job work are not received back by the

principal after completion of job-work or otherwise or are not supplied from the
place of business of the job worker in accordance with clause (a) or clause (b) of
sub-section (1) of section 143 within one year of being sent out, it shall be
deemed that such inputs had been supplied by the principal to the job-worker
on the day when the said inputs were sent out:

Provided that where the inputs are sent directly to a job worker, the

period of one year shall be counted from the date of receipt of inputs by the job
worker.
(4) The principal shall, subject to such conditions and restrictions as

may be prescribed, be allowed input tax credit on capital goods sent to a job
worker for job work.

(5) Notwithstanding anything contained in clause (b) of sub-section (2) of

section 16, the principal shall be entitled to take credit of input tax on capital
goods even if the capital goods are directly sent to a job worker for job work
without being first brought to his place of business.

(6) Where the capital goods sent for job work are not received back by

the principal within a period of three years of being sent out, it shall be deemed
that such capital goods had been supplied by the principal to the job worker on
the day when the said capital goods were sent out:

Provided that where the capital goods are sent directly to a job worker,

the period of three years shall be counted from the date of receipt of capital
goods by the job worker.


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(6) Nothing contained in sub-section (3) or sub-section (6) shall apply to

moulds and dies, jigs and fixtures, or tools sent out to a job worker for job
work.

**Explanation:-** For the purpose of this section, “principal” means the person

referred to in section 143.

**20. Manner of distribution of credit by Input Service Distributor-**
(1) The input Service Distributor shall distribute the credit of State tax

as State tax or integrated tax and integrated tax as integrated tax or State tax,
by way of issue of document containing the amount of input tax credit being
distributed in such manner as may be prescribed.

(2) The Input Service Distributor may distribute the credit subject to

the following conditions, namely:
(a) the credit can be distributed to the recipients of credit against
a document containing such details as may be prescribed;

(b) the amount of the credit distributed shall not exceed the
amount of credit available for distribution;

(c) the credit of tax paid on input services attributable to a
recipient of credit shall be distributed only to that recipient;

(d) the credit of tax paid on input services attributable to more
th0an one recipient of credit shall be distributed amongst
such recipients to whom the input service is attributable and
such distribution shall be pro rata on the basis of the
turnover in a State or turnover in a Union territory of such
recipient, during the relevant period, to the aggregate of the
turnover of all such recipients to whom such input service is
attributable and which are operational in the current year,
during the said relevant period;

(e) the credit of tax paid on input services attributable to all
recipients of credit shall be distributed amongst such
recipients and such distribution shall be pro rata on the basis
of the turnover in a State or turnover in a Union territory of
such recipient, during the relevant period, to the aggregate of
the turnover of all recipients and which are operational n the
current year, during the said relevant period.

**Explanation:-** For the purposes of this section,

-----

(a) the “relevant period” shall be,
(i) if the recipients of credit have turnover in their States or

Union territories in the financial year preceding the year
during which credit is to be distributed, the said financial
year; or

(ii) if some or all recipients of the credit do not have any

turnover in their States or Union territories in the financial
year preceding the year during which the credit is to be
distributed, the last quarter for which details of such
turnover of all the recipients are available, previous to the
month during which credit is to be distributed;

(b) the expression “recipient of credit” means the supplier of

goods or services or both having the same Permanent

Account Number as that of the Input Service Distributor;

(c) the term “turnover” in relation to any registered person

engaged in the supply of taxable goods as well as goods not

taxable under this Act, means value of turnover, reduced by

the amount of any duty or tax levied [1][under entries 84 and

92A] of List I of the Seventh Schedule to the

Constitution of India and entry 51 and 54 of List II of

the said Schedule.

**21. Manner of recovery of credit distributed in excess-**

Where the Input Service Distributor distributes the credit in

contravention of the provisions contained in section 20 resulting in excess
distribution of credit to one or more recipients of credit, the excess credit so
distributed shall be recovered from such recipients along with interest, and the
provisions of section 73 or section 74, as the case may be, shall mutatis
mutandis apply for determination of amount to be recovered.

**CHAPTER –VI**

**REGISTRATION**

**22. Persons liable for registration-** (1) Every supplier making a taxable
supply of goods or services or both in the State shall be liable to be registered
under this Act, if his aggregate turnover in a financial year exceeds twenty lakh
rupees:

1
Subs. by Act 23 of 2018, s.10 for “under entry 84”(w.e.f. 1-2-2019)


-----

Provided that where such person makes taxable supplies of goods or

services or both from any of the special category States, he shall be liable to be
registered if his aggregate turnover in a financial year exceeds ten lakh rupees;

[1][Provided further that the Government may, at the request of a special
category State and on the recommendations of the Council, enhance the
aggregate turnover referred to in the first proviso from ten lakh rupees to such
amount, not exceeding twenty lakh rupees and subject to such conditions and
limitations, as may be so notified.]

(2) Every person who, on the day immediately preceding the appointed

day, is registered or holds a licence under an existing law, shall be liable to be
registered under this Act with effect from the appointed day.

(3) Where a business carried on by a taxable person registered under

this Act is transferred, whether on account of succession or otherwise, to
another person as a going concern, the transferee or the successor, as the case
may be, shall be liable to be registered with effect from the date of such
transfer or succession.

(4) Notwithstanding anything contained in sub-sections (1) and (3), in a

case of transfer pursuant to sanction of a scheme or an arrangement for
amalgamation or, as the case may be, de-merger of two or more companies
pursuant to an order of a High Court, Tribunal or otherwise, the transferee
shall be liable to be registered, with effect from the date on which the Registrar
of Companies issues a certificate of incorporation giving effect to such order of
the High Court or Tribunal.

Explanation:- For the purposes of this section,
(i) the expression aggregate turnover shall include all
supplies made by the taxable person, whether on his
own account or made on behalf of all his principals;

(ii) the supply of goods, after completion of job-work, by a
registered job worker shall be treated as the supply of
goods by the principal referred to in section 143, and
the value of such goods shall not be included in the
aggregate turnover of the registered job worker;

(iii) The expression “special category States” shall mean the

States as specified in sub-clause (g) of clause (4) of

1
Ins. by Act 23 of 2018, s.11 (w.e.f. 1-2-2019)


-----

article 279A of the Constitution of India [1][except the
State of Jammu and Kashmir and States of Arunachal
Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim
and Uttarakhand].

**23. Persons not liable for registration- (1)** The following persons shall

not be liable to registration, namely,
(a) any person engaged exclusively in the business of supplying

goods or services or both that are not liable to tax or wholly
exempt from tax under this Act or under the Integrated Goods
and Services Tax Act, 2017; (Act No.13 of 2017);

(b) an agriculturist, to the extent of supply of produce out of

cultivation of land.

(2) The Government may, on the recommendations of the Council, by

notification, specify the category of persons who may be exempted from
obtaining registration under this Act.

**24. Compulsory registration in certain cases - Notwithstanding anything**
contained in sub-section (1) of section 22, the following categories of person
shall be required to be registered under this Act,
(i)  persons making any inter-State taxable supply;

(ii) casual taxable persons making taxable supply;

(iii) persons who are required to pay tax under reverse

charge;

(iv) person who are required to pay tax under sub-section (5)

of section 9;

(v) non resident taxable persons making taxable supply;

(vi) persons who are required to deduct tax under section 51,

whether or not separately registered under this Act;

(vii) persons who making taxable supply of goods or services

or both on behalf of other taxable persons whether as an
agent or otherwise;

1
Ins. by Act 23 of 2018, s.11 (w.e.f. 1-2-2019)


-----

(viii) input service distributor, whether or not separately

registered under this Act;

(ix) persons who supply goods or services or both, other than

supplies specified under sub-section (5) of section 9,
through such electronic commerce operator who is
required to collect tax at source under section 52;

(x) every electronic commerce operator [1][who is required to
collect tax at source under section 52];

(xi) every person supplying online information and data base

access or retrieval services from a place outside India to a
person in India, other than a registered person; and

(xii) such other person or class of persons as may be notified

by the Government on the recommendations of the
Council.

**25. Procedure for Registration- (1) Every person who is liable to be registered**
under section 22 or section 24 shall apply for registration within thirty days
from the date on which he becomes liable to registration, in such manner and
subject to such conditions as may be prescribed:

Provided that a casual taxable person or a non-resident taxable person

shall apply for registration at least five days prior to the commencement of
business.

2[Provided further that a person having a unit, as defined in the Special

Economic Zones Act, 2005 (Central Act No 28 of 2005.), in a Special Economic
Zone or being a Special Economic Zone developer shall have to apply for a
separate registration, as distinct from his place of business located outside the
Special Economic Zone in the same State].

**Explanation: Every person who makes a supply from the territorial waters of**
India shall obtain registration in the State where the nearest point of the
appropriate baseline is located in the State.

(2) A person seeking registration under this Act shall be granted a single

registration:

1
Ins. by Act 23 of 2018, s.12 (w.e.f. 1-2-2019)

2
Ins. by Act 23 of 2018, s.13 (w.e.f. 1-2-2019)


-----

1[Provided that a person having multiple places of business in the State

may be granted a separate registration for each such place of business, subject
to such conditions as may be prescribed.]

(3) A person, though not liable to be registered under section 22 of

section 24 may get himself registered voluntarily, and all provisions of this Act,
as are applicable to a registered person, shall apply to such person.

(4) A person who has obtained or is required to obtain more than one

registration, whether in one State or Union Territory or more than one State or
Union territory shall, in respect of each such registration, be treated as distinct
persons for the purposes of this Act.

(5) Where a person who has obtained or is required to obtain registration

in a State or Union territory in respect of an establishment, has an
establishment in another State or Union territory, then such establishment
shall be treated as establishments of distinct persons for the purposes of this
Act.

(6) Every person shall have a Permanent Account Number issued under

the Income-tax Act, 1961 in order to be eligible for grant of registration: Act
No.43 of 1961.

Provided that a person required to deduct tax under section 51 may

have, in lieu of a Permanent Account Number, a Tax Deduction and Collection
Account Number issued under the said Act in order to be eligible for grant of
registration.

(7) Notwithstanding anything contained in sub-section (6), a non
resident taxable person may be granted registration under sub-section (1) on
the basis of such other documents as may be prescribed.

(8) Where a person who is liable to be registered under this Act fails to

obtain registration, the proper officer may, without prejudice to any action
which may be taken under this Act, or under any other law for the time being
in force, proceed to register such person in such manner as may be prescribed.

(9) Notwithstanding anything contained in sub-section (1),
(a) Any specialized agency of the United Nations Organization or
any Multilateral Financial Institution and Organization notified
under the United Nations (Privileges and Immunities) Act, 1947,

1
Subs. by Act 23 of 2018, s.13 for proviso (w.e.f. 1-2-2019)


-----

consulate or Embassy of foreign countries; and

(b) any other person or class of persons, as may be notified by the

Chief Commissioner,

shall be granted a Unique Identity Number in such manner

and for such purposes, including refund of taxes on the notified
supplies of goods or services or both received by them, as may
be prescribed.

(10) The registration or the Unique Identity Number shall be granted or

rejected after due verification in such manner and within such period as may
be prescribed.

(11) A certificate of registration shall be issued in such from and with

effect from such date, as may be prescribed.

(12) A registration or an Unique Identity Number shall be deemed to

have been granted after the expiry of the period prescribed under sub-section
(10), if no deficiency has been communicated to the applicant within that
period.

**26. Deemed Registration- (1) The grant of registration or the Unique Identity**
Number under the Central Goods and Services Tax Act, 2017 (Act No.12 of
2017) shall be deemed to be a grant of registration or the Unique Identity
Number under this Act subject to the condition that the application for
registration or the Unique Identity Number has not been rejected under this
Act within the time specified in sub-section (10) of section 25.

(2) Notwithstanding anything contained in sub-section (10) of section 25,

any rejection of application for registration or the Unique Identity Number
under the Central Goods and Services Tax Act, 2017 shall be deemed to be a
rejection of application for registration under this Act. (Act No.12 of 2017).

**27. Special provisions relating to casual taxable person and non-resident**
**taxable person- (1)** The certificate of registration issued to a casual

taxable person or a non-resident taxable person shall be valid for the period
specified in the application for registration or ninety days from the effective
date of registration, whichever is earlier and such person shall make taxable
supplies only after the issuance of the certificate of registration:

Provided that the proper officer may, on sufficient cause being shown by

the said taxable person, extend the said period of ninety days by a further
period not exceeding ninety days.


-----

(2) A casual taxable person or a non-resident taxable person shall, at

the time of submission of application for registration under sub-section (1) of
section 25, make an advance deposit of tax in an amount equivalent to the
estimated tax liability of such person for the period for which the registration is
sought:
Provided that where any extension of time is sought under sub-section

(1), such taxable person shall deposit an additional amount of tax equivalent to
the estimated tax liability of such person for the period for which the extension
is sought.

(3) The amount deposited under sub-section (2) shall be credited to the

electronic cash ledger of such person and shall be utilised in the manner
provided under section 49.

**28. Amendment of registration-** (1) Every registered person and a person to
whom a Unique Identity Number has been assigned shall inform the proper
officer of any changes in the information furnished at the time of registration or
subsequent thereto, in such form and manner and within such period as may
be prescribed.

(2) The proper officer may, on the basis of information furnished

under sub-section (1) or as ascertained by him, approve or reject amendments
in the registration particulars in such manner and within such period as may
be prescribed:

Provided that approval of the proper officer shall not be required in

respect of amendment of such particulars as may be prescribed:

Provided further that the proper officer shall not reject the application

for amendment in the registration particulars without giving the person an
opportunity of being heard.

(3) Any rejection or approval of amendments under the Central Goods

and Services Tax Act, 2017 shall be deemed to be a rejection or approval under
this Act. (Act No.12 of 2017).

**29. Cancellation** **[1][or suspension] of Registration-** (1) The proper officer
may, either on his own motion or on an application filed by the registered
person or by his legal heirs, in case of death of such person, cancel the
registration, in such manner and within such period as may be prescribed,
having regard to the circumstances where,
1
Ins. by Act 23 of 2018, s.14 (w.e.f. 1-2-2019)


-----

(a) the business has been discontinued, transferred fully for any
reason including death of the proprietor, amalgamated with

other legal entity, demerged or otherwise disposed of; or

(b)  there is any change in the constitution of the business; or

(c) the taxable person, other than the person registered under
sub-section (3) of section 25, is no longer liable to be

registered under section 22 or section 24.

1[Provided that during pendency of the proceedings relating

to cancellation of registration filed by the registered person, the
registration may be suspended for such period and in such
manner as may be prescribed.]

(2) The proper officer may cancel the registration of a person from

such date, including any retrospective date, as he may deem fit, where,
(a) a registered person has contravened such provisions of the
Act or the rules made there under as may be prescribed; or

(b) a person paying tax under section 10 has not furnished
returns for three consecutive tax periods; or

(c) any registered person, other than a person specified in clause
(b), has not furnished returns for a continuous period of six
months; or

(d) any person who has taken voluntary registration under sub
section (3) of section 25 has not commenced business within
six months from the date of registration; or

(e) registration has been obtained by means of fraud, wilful
misstatement or suppression of facts:

Provided that the proper officer shall not cancel the registration without

giving the person an opportunity of being heard.

2[Provided further that during pendency of the proceedings relating to

cancellation of registration, the proper officer may suspend the registration for
such period and in such manner as may be prescribed.]

(3) The cancellation of registration under this section shall not affect the

liability of the person to pay tax and other dues under this Act or to discharge

1
Ins. by Act 23 of 2018, s.14 (w.e.f. 1-2-2019)

2
Ins. by Act 23 of 2018, s.14 (w.e.f. 1-2-2019)


-----

any obligation under this Act or the rules made there under for any period
prior to the date of cancellation whether or not such tax and other dues are
determined before or after the date of cancellation.

(4) The cancellation of registration under the Central Goods and Services

Tax Act, 2017 shall be deemed to be a cancellation of registration under this
Act. (Act No.12 of 2017).

(5) Every registered person whose registration is cancelled shall pay an

amount, by way of debit in the electronic credit ledger or electronic cash ledger,
equivalent to the credit of input tax in respect of inputs held in stock and
inputs contained in semi-finished or finished goods held in stock or capital
goods or plant and machinery on the day immediately preceding the date of
such cancellation or the output tax payable on such goods, whichever is
higher, calculated in such manner as may be prescribed:

Provided that in case of capital goods or plant and machinery, the

taxable person shall pay an amount equal to the input tax credit taken on the
said capital goods or plant and machinery, reduced by such percentage points
as may be prescribed or the tax on the transaction value of such capital goods
or plant and machinery under section 15, whichever is higher.

(6) The amount payable under sub-section (5) shall be calculated in

such manner as may be prescribed.

**30. Revocation of cancellation of registration-** (1) Subject to such
conditions as may be prescribed, any registered person, whose registration is
cancelled by the proper officer on his own motion, may apply to such officer for
revocation of cancellation of the registration in the prescribed manner within
thirty days from the date of service of the cancellation order.

(2) The proper officer may, in such manner and within such period as

may be prescribed, by order, either revoke cancellation of the registration or
reject the application:

Provided that the application for revocation of cancellation of registration

shall not be rejected unless the applicant has been given an opportunity of
being heard.

(3) The revocation of cancellation of registration under the Central

Goods and Services Tax Act, 2017 shall be deemed to be a revocation of
cancellation of registration under this Act. (Act No.12 of 2017).


-----

**CHAPETR – VII**

**TAX INVOICE, CREDIT AND DEBIT NOTES**

**31. Tax invoice- (1) A registered person supplying taxable goods shall, before**
or at the time of,
(a)  removal of goods for supply to the recipient, where the supply

involves movement of goods; or

(b)  delivery of goods or making available thereof to the recipient,

in any other case, issue a tax invoice showing the

description, quantity and value of goods, the tax charged

thereon and such other particulars as may be prescribed:

Provided that the Government may, on the recommendations

of the Council, by notification, specify the categories of goods or
supplies in respect of which a tax invoice shall be issued, within
such time and in such manner as may be prescribed.

(2) A registered person supplying taxable services shall, before or after

the provision of service but within a period prescribed, issue a tax invoice,
showing the description, value, tax charged thereon and such other particulars
as may be prescribed.

Provided that the Government may, on the recommendations of the

Council, by notification and subject to such conditions as may be mentioned
therein, specify the categories of services in respect of which,
(a) any other document issued in relation to the supply shall be
deemed to be a tax invoice; or

(b) tax invoice may not be required to be issued.

(3) Notwithstanding anything contained in sub-sections (1) and (2),
(a) a registered person may, within one month from the date of
issuance of certificate of registration and in such manner as
may be prescribed, issue a revised invoice against the invoice
already issued during the period beginning with the effective
date of registration till the date of issuance of certificate of
registration to him;

(b) a registered person may not issue a tax invoice if the value of
the goods or services or both supplied is less than two


-----

hundred rupees subject to such conditions and in such
manner as may be prescribed;

(c) a registered person supplying exempted goods or services or
both paying tax under the provisions of section 10 shall issue,
instead of a tax invoice, a bill of supply containing such
particulars and in such manner as may be prescribed:

Provided that the registered person may not issue a bill of
supply if the value of the goods or services or both supplied is
less than two hundred rupees subject to such conditions and
in such manner as may be prescribed:

(d) a registered person shall, on receipt of advance payment with
respect to any supply of goods or services or both, issue a
receipt voucher or any other document, containing such
particulars as may be prescribed, evidencing receipt of such
payment;

(e) where, on receipt of advance payment with respect to any
supply of goods or services or both the registered person
issues a receipt voucher, but subsequently no supply is made
and no tax invoice is issued in pursuance thereof, the said
registered person may issue to the person who had made the
payment, a refund voucher against such payment;

(f) a registered person who is liable to pay tax under sub-section
(3) or sub-section (4) of section 9 shall issue an invoice in
respect of goods or services or both received by him on the
date of receipt of goods or services or both;

(g) a registered person who is liable to pay tax under sub-section
(3) or sub-section (4) of section 9 shall issue a payment
voucher at the time of making payment to the supplier.

(4) In case of continuous supply of goods, where successive

statements of accounts or successive payments are involved, the invoice shall
be issued before or at the time each such statement is issued or, as the case
may be, each such payment is received.

(5) Subject to the provisions of clause (d) of sub-section (3), in case of

continuous supply of services,
(a) where the due date of payment is ascertainable from the

contract, the invoice shall be issued on or before the due date
of payment;


-----

(b) where the due date of payment is not ascertainable from the

contract, the invoice shall be issued before or at the time when
the supplier of service receives the payment;

(c) where the payment is linked to the completion of an event, the

invoice shall be issued on or before the date of completion of
that event.

(6) In a case where the supply of services ceases under a contract before

the completion of the supply, the invoice shall be issued at the time when the
supply ceases and such invoice shall be issued to the extent of the supply
effected before such cessation.

(7) Notwithstanding anything contained in sub-section (1), where the

goods being sent or taken on approval for sale or return are removed before the
supply takes place, the invoice shall be issued before or at the time of supply or
six months from the date of removal, whichever is earlier.

**Explanation:-** For the purposes of this section, the expression “tax invoice”

shall include any revised invoice issued by the supplier in respect of a supply
made earlier.

**32.** **Prohibition on unauthorised collection of tax- (1) A person who is not**

a registered person shall not collect in respect of any supply of goods or
services or both any amount by way of tax under this Act.

(2) No registered person shall collect tax except in accordance with the

provisions of this Act or the rules made thereunder.

**33. Amount of tax to be indicated in tax invoice and other documents-**
Notwithstanding anything contained in this Act or any other law for the time
being in force, where any supply is made for a consideration, every person who
is liable to pay tax for such supply shall prominently indicate in all documents
relating to assessment, tax invoice and other like documents, the amount of
tax which shall form part of the price at which such supply is made.

**34. Credit and debit notes-** (1) [1][Where one or more tax invoices] have been
issued for supply of any goods or services or both and the taxable value or tax
charged in that tax invoice is found to exceed the taxable value or tax payable
in respect of such supply, or where the goods supplied are returned by the
recipient, or where goods or services or both supplied are found to be deficient,
the registered person, who has supplied such goods or services or both, may

1
Subs. by Act 23 of 2018, s.15, for the words “Where a tax invoice has” (w.e.f. 1-2-2019)


-----

issue to the recipient [1][one or more credit notes for supplies made in a financial
year] containing such particulars as may be prescribed.

(2) Any registered person who issues a credit note in relation to a

supply of goods or services or both shall declare the details of such credit note
in the return for the month during which such credit note has been issued but
not later than September following the end of the financial year in which such
supply was made, or the date of furnishing of the relevant annual return,
whichever is earlier, and the tax liability shall be adjusted in such manner as
may be prescribed:

Provided that no reduction in output tax liability of the supplier shall be

permitted, if the incidence of tax and interest on such supply has been passed
on to any other person.

(3) [2][Where one or more tax invoices have] been issued for supply of any

goods or services or both and the taxable value or tax charged in that tax
invoice is found to be less than the taxable value or tax payable in respect of
such supply, the registered person, who has supplied such goods or services or
both, shall issue to the recipient [3][one or more debit notes for supplies made in
a financial year] containing such particulars as may be prescribed.

(4) Any registered person who issues a debit note in relation to a supply

of goods or services or both shall declare the details of such debit note in the
return for the month during which such debit note has been issued and the tax
liability shall be adjusted in such manner as may be prescribed.

**Explanation:-** For the purposes of this Act, the expression “debit note”

shall include a supplementary invoice.

**CHAPTER VIII**

**ACCOUNTS AND RECORDS**

**35. Accounts and other records-** (1) Every registered person shall keep and

maintain, at his principal place of business, as mentioned in the certificate of
registration, a true and correct account of,
(a) production or manufacture of goods;

1
Subs. by Act 23 of 2018, s.15, for the words “a credit note” (w.e.f. 1-2-2019)
2
Subs. by Act 23 of 2018, s.15, for the words “Where a tax invoice has” (w.e.f. 1-2-2019)
3
Subs. by Act 23 of 2018, s.15, for the words “a debit note” (w.e.f. 1-2-2019)


-----

(b) inward or outward supply of goods or services or both;

(c) stock of goods;

(d) input tax credit availed;

(e) output tax payable and paid; and

(f) such other particulars as may be prescribed:

Provided that where more than one place of business is specified in the

certificate of registration, the accounts relating to each place of business shall
be kept at such places of business:

Provided further that the registered person may keep and maintain such

accounts and other particulars in electronic form in such manner as may be
prescribed.

(2) Every owner or operator of warehouse or godown or any other place

used for storage of goods and every transporter, irrespective of whether he is a
registered person or not, shall maintain records of the consigner, consignee
and other relevant details of the goods in such manner as may be prescribed.

(3) The Chief Commissioner may notify a class of taxable persons to

maintain additional accounts or documents for such purpose as may be
specified therein.

(4) Where the Chief Commissioner considers that any class of taxable

persons is not in a position to keep and maintain accounts in accordance with
the provisions of this section, he may, for reasons to be recorded in writing,
permit such class of taxable persons to maintain accounts in such manner as
may be prescribed.

(5) Every registered person whose turnover during a financial year

exceeds the prescribed limit shall get his accounts audited by a chartered
accountant or a cost accountant and shall submit a copy of the audited annual
accounts, the reconciliation statement under sub-section (2) of section 44 and
such other documents in such form and manner as may be prescribed.

1[Provided that nothing contained in this sub-section shall apply to any

department of the Central Government or a State Government or a local
authority, whose books of account are subject to audit by the Comptroller and

1
Ins. by Act 23 of 2018, s.16 (w.e.f. 1-2-2019)


-----

Auditor-General of India or an auditor appointed for auditing the accounts of
local authorities under any law for the time being in force.]

(6) Subject to the provisions of clause (h) of sub-section (5) of section 17,

where the registered person fails to account for the goods or services or both in
accordance with the provisions of sub-section (1), the proper officer shall
determine the amount of tax payable on the goods or services or both that are
not accounted for, as if such goods or services or both had been supplied by
such person and the provisions of section 73 or section 74, as the case may be,
shall, mutatis mutandis, apply for determination of such tax.

**36. Period of retention of accounts-** Every registered person required to
keep and maintain books of account or other records in accordance with the
provisions of sub-section (1) of section 35 shall retain them until the expiry of
seventy two months from the due date of furnishing of annual return for the
year pertaining to such accounts and records:

Provided that a registered person, who is a party to an appeal or revision

or any other proceedings before any Appellate Authority or Revisional Authority
or Appellate Tribunal or Court, whether filed by him or by the Chief
Commissioner, or is under investigation for an offence under Chapter XIX,
shall retain the books of account and other records pertaining to the subject
matter of such appeal or revision or proceedings or investigation for a period of
one year after final disposal of such appeal or revision or proceedings or
investigation, or for the period specified above, whichever is later.

**CHAPTER –IX**

**RETURNS**

**37.** **Furnishing details of outward supplies -** (1) Every registered person,

other than an Input Service Distributor, a non-resident taxable persona and a
person paying tax under the provisions of section 10 or section 51 or section
52, shall furnish, electronically, in such form and manner as may be
prescribed, the details of outward supplies of goods or services or both effected
during a tax period on or before the tenth day of the month succeeding the said
tax period and such details shall be communicated to the recipient of the said
supplies within such time and in such manner as may be prescribed:

Provided that the registered person shall not be allowed to furnish the

details of outward supplies during the period from the eleventh day to the
fifteenth day of the month succeeding the tax period:


-----

Provided further that the Chief Commissioner may, for reasons to be

recorded in writing, by notification, extend the time limit for furnishing such
details, for such class of taxable persons as may be specified therein:

Provided also that any extension of time limit notified by the

Commissioner of central tax shall be deemed to be notified by the Chief
Commissioner.

(2) Every registered person who has been communicated the details

under sub-section (3) of section 38 or the details pertaining to inward supplies
of Input Service Distributor under sub-section (4) of section 38, shall either
accept or reject the details so communicated, on or before the seventeenth day,
but not before the fifteenth day, of the month succeeding the tax period and
the details furnished by him under sub-section (1) shall stand amended
accordingly.

(3) Any registered person, who has furnished the details under sub
section (1) for any tax period and which have remained unmatched under
section 42 or section 43, shall, upon discovery of any error or omission therein,
rectify such error or omission in such manner as may be prescribed, and shall
pay the tax and interest, if any, in case there is a short payment of tax on
account of such error or omission, in the return to be furnished for such tax
period:

Provided that no rectification of error or omission in respect of the details

furnished under sub-section (1) shall be allowed after furnishing of the return
under section 39 for the month of September following the end of the financial
year to which such details pertain, or furnishing of the relevant annual return,
whichever is earlier.

**Explanation:-** For the purposes of this Chapter, the expression “details

of outward supplies” shall include details of invoices, debit notes, credit notes
and revised invoices issued in relation to outward supplies made during any
tax period.

**38. Furnishing details of inward supplies- (1) Every registered person, other**
than an Input Service Distributor or a non-resident taxable person or a person
paying tax under the provisions of section 10 or section 51 or section 52, shall
verify, validate, modify or delete, if required, the details relating to outward
supplies and credit or debit notes communicated under sub-section (1) of
section 37 to prepare the details of his inward supplies and credit or debit
notes and may include therein, the details of inward supplies and credit or
debit notes received by him in respect of such supplies that have not been
declared by the supplier under sub-section (1) of section 37.


-----

(2) Every registered person, other than Input Service Distributor or a

non-resident taxable person or a person paying tax under the provisions of
section 10 or section 51 or section 52, shall furnish, electronically, the details
of inward supplies of taxable goods or services or both, including inward
supplies of goods or services or both on which the tax is payable on reverse
charge basis under this Act and inward suppliers of goods or services or both
taxable under the Integrated Goods and Services Tax Act, 2017 (Act No.13 of
2017) or on which integrated goods and services tax is payable under section 3
of the Customs Tariff Act, 1975, (Act No.51 of 1975) and credit or debit notes
received in respect of such supplies during a tax period after the tenth day but
on or before the fifteenth day of the month succeeding the tax period in such
form and manner as may be prescribed:

Provided that the Chief Commissioner may, for reasons to be recorded

in writing, by notification, extend the time limit for furnishing such details for
such class of taxable persons as may be specified therein:

Provided further that any extension of time limit notified by the

Commissioner of central tax shall be deemed to be notified by the Chief
Commissioner.

(3) The details of suppliers modified, deleted or included by the

recipient and furnished under sub-section (2) shall be communicated to the
supplier concerned in such manner and within such time as may be
prescribed.

(4) The details of supplies modified, deleted or included by the

recipient in the return furnished under sub-section (2) or sub-section (4) of
section 39 shall be communicated to the supplier concerned in such manner
and within such time as may be prescribed.

(5) Any registered person, who has furnished the details under sub
section (2) for any tax period and which have remained unmatched under
section 42 or section 43, shall, upon discovery of any error or omission
therein, rectify such error or omission in the tax period during which such
error or omission is noticed in such manner as may be prescribed, and shall
pay the tax and interest, if any, in case there is a short payment of tax on
account of such error or omission, in the return to be furnished for such tax
period:

Provided that no rectification of error or omission in respect of the

details furnished under sub-section (2) shall be allowed after furnishing of the
return under section 39 for the month of September following the end of the
financial year to which such details pertain, or furnishing of the relevant
annual return, whichever is earlier.


-----

**39. Furnishing of Returns- (1) Every registered person, other than an Input**
Service Distributor or a non-resident taxable person or a person paying tax
under the provisions of section 10 or section 51 or section 52 shall, for every
calendar month or part thereof, furnish, [1][in such form, manner and within
such time as may be prescribed], a return, electronically, of inward and
outward supplies of goods or services or both, input tax credit availed, tax
payable, tax paid and such other particulars as may be prescribed [2]* * * * *

3[Provided that the Government may, on the recommendations of the

Council, notify certain classes of registered persons who shall furnish return
for every quarter or part thereof, subject to such conditions and safeguards as
may be specified therein.]

(2) A registered person paying tax under the provisions of section 10

shall, for each quarter or part thereof, furnish, in such from and manner as
may be prescribed, a return, electronically, of turnover in the state inward
supplies of goods or services or both, tax payable and tax paid within eighteen
days after the end of such quarter.

(3) Every registered person required to deduct tax at source under the

provisions of section 51 shall furnish, in such form and manner as may be
prescribed, a return, electronically, for the month in which such deductions
have been made within ten days after the end of such month.

(4) Every taxable person registered as an Input Service Distributor

shall, for every calendar month or part thereof, furnish, in such form and
manner as may be prescribed, a return, electronically, within thirteen days
after the end of such month.

(5) Every registered non-resident taxable person shall, for every

calendar month or part thereof, furnish, in such form and manner as may be
prescribed, a return electronically, within twenty days after the end of a
calendar month or within seven days after the last day of the period of
registration specified under sub-section (1) of section 27, whichever is earlier.

1
Subs. by Act 23 of 2018, s.17 (w.e.f. 1-2-2019)

2
The words “on or before the twentieth day of the month succeeding such calendar month or part thereof ” omitted by Act 23 of 2018,
s.17 (w.e.f. 1-2-2019)

3
Ins. by Act 23 of 2018, s.17 (w.e.f. 1-2-2019)


-----

(6) The Chief Commissioner may, for reasons to be recorded in writing

by notifications, extend the time limit for furnishing the returns under this
section for such class of registered persons as may be specified therein:

Provided that any extension of time limit notified by the Commissioner

of central tax shall be deemed to be notified by the Chief Commissioner.

(7) Every registered person, who is required to furnish a return under

sub-section (1) or sub-section (2) or sub-section (3) or sub-section (5), shall
pay to the Government the tax due as per such return not later than the last
date on which he is required to furnish such return.

1[Provided that the Government may, on the recommendations of the

Council, notify certain classes of registered persons who shall pay to the
Government the tax due or part thereof as per the return on or before the last
date on which he is required to furnish such return, subject to such
conditions and safeguards as may be specified therein.]

(8) Every registered person who is required to furnish a return under

sub-section (1) or sub-section (2) shall furnish a return for every tax period
whether or not any supplies of goods or services or both have been effected
during such tax period.

(9) Subject to the provisions of sections 37 and 38, if any registered

person after furnishing a return under sub-section (1) or sub-section (2) or
sub-section (3) or sub-section (4) or sub-section (5) discovers any omission or
incorrect particulars therein, other than as a result of scrutiny, audit,
inspection or enforcement activity by the tax authorities, he shall rectify such
omission or incorrect particulars [2][in such form and manner as may be
prescribed], subject to payment of interest under this Act:

Provided that no such rectification of any omission or incorrect

particulars shall be allowed after the due date for furnishing of return for the
month of September or second quarter following [3][the end of the financial year
to which such details pertain,] or the actual date of furnishing or relevant
annual return, whichever is earlier.

(10) A registered person shall not be allowed to furnish a return for a

tax period if the return for any of the previous tax periods has not been
furnished by him.

1
Ins. by Act 23 of 2018, s.17 (w.e.f. 1-2-2019)
2
Subs. by Act 23 of 2018, s.17(w.e.f. 1-2-2019)
3
Subs. by Act 23 of 2018, s.17, for the words “the end of the financial year”(w.e.f. 1-2-2019)


-----

**40. First Return- Every registered person who has made outward supplies in**
the period between the date on which he became liable to registration till the
date on which registration has been granted shall declare the same in the first
return furnished by him after grant of registration.

**41. Claim of input tax credit and provisional acceptance thereof-**
(1) Every registered person shall, subject to such conditions and

restrictions as may be prescribed, be entitled to take credit of eligible input
tax, as self-assessed, in his return and such amount shall be credited on a
provisional basis to his electronic credit ledger.

(2) The credit referred to in sub-section (1) shall be utilised only for

payment of self-assessed output tax as per the return referred to in the said
sub-section.

**42.** **Matching, reversal and reclaim of input tax -** (1) The details of every
inward supply furnished by a registered person (hereafter in this section
referred to as the “recipient”) for a tax period shall, in such manner and
within such time as may be prescribed, be matched,
(a) with the corresponding details of outward supply furnished by

the corresponding registered person (hereafter in this section
referred to as the “supplier”) in his valid return for the same tax
period or any preceding tax period;

(b) with the integrated goods and services tax paid under section 3

of the Customs Tariff Act, 1975 (Act No.51 of 1975) in respect
of goods imported by him; and

(c) for duplication of claims of input tax credit.

(2) The claim of input tax credit in respect of invoices or debit notes

relating to inward supply that match with the details of corresponding
outward supply or with the integrated goods and services tax paid under
section 3 of the Customs Tariff Act, 1975 (Act No. 51 of 1975) in respect of
goods imported by him shall be finally accepted and such acceptance shall be
communicated, in such manner as may be prescribed, to the recipient.

(3) Where the input tax credit claimed by a recipient in respect of an

inward supply is in excess of the tax declared by the supplier for the same
supply or the outward supply is not declared by the supplier in his valid
returns, the discrepancy shall be communicated to both such persons in
such manner as may be prescribed.

(4) The duplication of claims of input tax credit shall be communicated

to the recipient in such manner as may be prescribed.


-----

(5) The amount in respect of which any discrepancy is communicated

under sub-section (3) and which is not rectified by the supplier in his valid
return for the month in which discrepancy is communicated shall be added to
the output tax liability of the recipient, in such manner as may be prescribed,
in his return for the month succeeding the month in which the discrepancy is
communicated.

(6) The amount claimed as input tax credit that is found to be in excess

on account of duplication of claims shall be added to the output tax liability
of the recipient in his return for the month in which the duplication is
communicated.

(7) The recipient shall be eligible to reduce, from his output tax

liability, the amount added under sub-section (5), if the supplier declares the
details of the invoice or debit note in his valid return within the time specified
in sub-section (9) of section 39.

(8) A recipient in whose output tax liability any amount has been

added under sub-section (5) or sub-section (6), shall be liable to pay interest
at the rate specified under sub-section (1) of section 50 on the amount so
added from the date of availing of credit till the corresponding additions are
made under the said sub-sections.

(9) Where any reduction in output tax liability is accepted under sub
section (7), the interest paid under sub-section (8) shall be refunded to the
recipient by crediting the amount in the corresponding head of his electronic
cash ledger in such manner as may be prescribed.

Provided that the amount of interest to be credited in any case shall not

exceed the amount of interest paid by the supplier.

(10) The amount reduced from the output tax liability in contravention

of the provisions of sub-section (7) shall be added to the output tax liability of
the recipient in his return for the month in which such contravention takes
place and such recipient shall be liable to pay interest on the amount so
added at the rate specified in sub-section (3) of section 50.

**43. Matching, reversal and reclaim of reduction in output tax liability-**
(1) The details of every credit note relating to outward supply furnished by a
registered person (hereafter in this section referred to as the “supplier”) for a
tax period shall, in such manner and within such time as may be prescribed,
be matched,
(a) with the corresponding reduction in the claim for input tax credit

by the corresponding registered person (hereafter in this section


-----

referred to as the “recipient”) in his valid return for the same tax

period or any subsequent tax period; and

(b) for duplication of claims for reduction in output tax liability.

(2) The claim for reduction in output tax liability by the supplier that

matches with the corresponding reduction in the claim for input tax credit by
the recipient shall be finally accepted and communicated, in such manner as
may be prescribed, to the supplier.

(3) Where the reduction of output tax liability in respect of outward

supplies exceeds the corresponding reduction in the claim for input tax credit
or the corresponding credit note is not declared by the recipient in his valid
returns, the discrepancy shall be communicated to both such persons in
such manner as may be prescribed.

(4) The duplication of claims for reduction in output tax liability shall

be communicated to the supplier in such manner as may be prescribed.

(5) The amount in respect of which any discrepancy is communicated

under sub-section (3) and which is not rectified by the recipient in his valid
return for the month in which discrepancy is communicated shall be added to
the output tax liability of the supplier, in such manner as may be prescribed,
in his return for the month succeeding the month in which the discrepancy is
communicated.

(6) The amount in respect of any reduction in output tax liability that

is found to be on account of duplication of claims shall be added to the
output tax liability of the supplier in his return for the month in which such
duplication is communicated.

(7) The supplier shall be eligible to reduce, from his output tax liability,

the amount added under sub-section (5) if the recipient declares the details of
the credit note in his valid return within the time specified in sub-section (9)
of section 39.

(8) A supplier in whose output tax liability any amount has been added

under sub-section (5) or sub-section (6), shall be liable to pay interest at the
rate specified under sub-section (1) of section 50 in respect of the amount so
added from the date of such claim for reduction in the output tax liability till
the corresponding additions are made under the said sub-sections.

(9) Where any reduction in output tax liability is accepted under sub
section (7), the interest paid under sub-section (8) shall refunded to the
supplier by crediting the amount in the corresponding head of his electronic
cash ledger in such manner as may be prescribed:


-----

Provided that the amount of interest to be credited in any case shall not

exceed the amount of interest paid by the recipient.

(10) The amount reduced from output tax liability in contravention of

the provisions of sub-section (7), shall be added to the output tax liability of
the supplier in his return for the month in which such contravention takes
place and such supplier shall be liable to pay interest on the amount so
added at the rate specified in sub-section (3) of section 50.

1[43A. Procedure for furnishing return and availing input tax credit -  (1)
Notwithstanding anything contained in sub-section (2) of section 16, section
37 or section 38, every registered person shall in the returns furnished under
sub-section (1) of section 39 verify, validate, modify or delete the details of
supplies furnished by the suppliers.

(2) Notwithstanding anything contained in section 41, section 42 or

section 43, the procedure for availing of input tax credit by the recipient and
verification thereof shall be such as may be prescribed.

(3) The procedure for furnishing the details of outward supplies by the

supplier on the common portal, for the purposes of availing input tax credit
by the recipient shall be such as may be prescribed.

(4) The procedure for availing input tax credit in respect of outward

supplies not furnished under sub-section (3) shall be such as may be
prescribed and such procedure may include the maximum amount of the
input tax credit which can be so availed, not exceeding twenty per cent. of the
input tax credit available, on the basis of details furnished by the suppliers
under the said sub-section.

(5) The amount of tax specified in the outward supplies for which the

details have been furnished by the supplier under sub-section (3) shall be
deemed to be the tax payable by him under the provisions of the Act.

(6) The supplier and the recipient of a supply shall be jointly and

severally liable to pay tax or to pay the input tax credit availed, as the case
may be, in relation to outward supplies for which the details have been
furnished under sub-section (3) or sub-section (4) but return thereof has not
been furnished.

(7) For the purposes of sub-section (6), the recovery shall be made in

such manner as may be prescribed and such procedure may provide for non
1
Ins. by Act 23 of 2018, s.18 (w.e.f. 1-2-2019)


-----

recovery of an amount of tax or input tax credit wrongly availed not exceeding
one thousand rupees.

(8) The procedure, safeguards and threshold of the tax amount in

relation to outward supplies, the  details of which can be furnished under
sub-section (3) by a registered person,—

(i) within six months of taking registration;

(ii) who has defaulted in payment of tax and where such default

has continued for more than two months from the due date
of payment of such defaulted amount, shall be

such as may be prescribed.]

**44. Annual return-** (1) Every registered person, other than an Input Service
Distributor, a person paying tax under section 51 or section 52, a casual
taxable person and a non-resident taxable person, shall furnish an annual
return for every financial year electronically in such form and manner as may
be prescribed on or before the thirty-first day of December following the end of
such financial year.

(2) Every registered person who is required to get his accounts audited

under sub-section (5) of section 35 shall furnish, electronically, the annual
return under sub-section (1) along with a copy of the audited annual
accounts and a reconciliation statement, reconciling the value of supplies
declared in the return furnished for the financial year with the audited
annual financial statement, and such other particular as may be prescribed.

**45. Final return- Every registered person who is required to furnish a return**
under sub-section (1) of section 39 and whose registration has been
cancelled shall furnish a final return within three months of the date of
cancellation or date of order of cancellation, whichever is later, in such form
and manner as may be prescribed.

**46. Notice to return defaulters- Where a registered person fails to furnish a**
return under section 39 or section 44 or section 45, a notice shall be issued
requiring him to furnish such return within fifteen days in such form and
manner as may be prescribed.

**47. Levy of late fee- (1) Any registered person who fails to furnish the details**
of outward or inward supplies required under section 37 or section 38 or
returns required under section 39 or section 45 by the due date shall pay a
late fee of one hundred rupees for every day during which such failure
continues subject to a maximum amount of five thousand rupees.


-----

(2) Any registered person who fails to furnish the return required under

section 44 by the due date shall be liable to pay a late fee of one hundred
rupees for every day during which such failure continues subject to a
maximum of an amount calculated at a quarter percent of his turnover in the
State.

**48. Goods and services tax practitioners-** (1) The manner of approval of
goods and services tax practitioners, their eligibility conditions, duties and
obligations, manner of removal and other conditions relevant for their
functioning shall be such as may be prescribed.

(2) A registered person may authorise an approved goods and service

tax practitioner to furnish the details of outward suppliers under section 37,
the details of inward supplies under section 38 and the return under section
39 or section 44 or section 45 [1][and to perform such other functions] in such
manner as may be prescribed.

(3) Notwithstanding anything contained in sub-section (2), the

responsibility for correctness of any particulars furnished in the return or
other details filed by the goods and services tax practitioners shall continue to
rest with the registered person on whose behalf such return and details are
furnished.

**CHAPTER –X**

**PAYMENT OF TAX**

**49. Payment of tax, interest, penalty and other amounts-**
(1) Every deposit made towards tax, interest, penalty, fee or any

other amount by a person by internet banking or by using credit or debit
cards or National Electronic Fund Transfer or Real Time Gross Settlement or
by such other mode and subject to such conditions and restrictions as may
be prescribed, shall be credited to the electronic cash ledger of such person to
be maintained in such manner as may be prescribed.

(2) The input tax credit as self-assessed in the return of a registered

person shall be credited to his electronic credit ledger, in accordance with
2[section 41 or section 43A], to be maintained in such manner as may be
prescribed.

(3) The amount available in the electronic cash ledger may be used for

making any payment towards tax, interest, penalty, fees or any other amount

1
Ins. by Act 23 of 2018, s.19 (w.e.f. 1-2-2019)
2
Subs. by Act 23 of 2018, s.20, for “section 41” (w.e.f. 1-2-2019)


-----

payable under the provisions of this Act or the rules made thereunder in such
manner and subject to such conditions and within such time as may be
prescribed.

(4) The amount available in the electronic credit ledger may be used for

making any payment towards output tax under this Act or under the
Integrated Goods and Services Tax Act, 2017 (Act No.13 of 2017) in such
manner and subject to such conditions and within such time as may be
prescribed.

(5) The amount of input tax credit available in the electronic credit

ledger of the registered person on account of,
(a) integrated tax shall first be utilised towards payment of
integrated tax and the amount remaining, if any, may be
utilised towards the payment of central tax and State tax, or as
the case may be, Union Territory tax, in that order;

(b) the central tax shall first be utilised towards payment of central
tax and the amount remaining, if any, may be utilised towards
the payment of integrated tax;

(c) the State tax shall first be utilised towards payment of State
tax and the amount remaining, if any. may be utilised towards
the payment of integrated tax;

1[Provided that the input tax credit on account of State tax

shall be utilised towards payment of integrated tax only where
the balance of the input tax credit on account of central tax is
not available for payment of integrated tax.]

(d) the Union territory tax shall first be utilised towards payment
of Union territory tax and the amount remaining, if any, may
be utilised towards the payment of integrated tax;

2[Provided that the input tax credit on account of Union

territory tax shall be utilised towards payment of integrated tax
only where the balance of the input tax credit  on account of
central tax is not available for payment of integrated tax.]

(e) the central tax shall not be utilised towards payment of State
tax or Union territory tax; and

1
Ins. by Act 23 of 2018, s.20(w.e.f. 1-2-2019)
2
Ins. by Act 23 of 2018, s.20(w.e.f. 1-2-2019)


-----

(f) the State tax or Union territory tax shall not be utilised towards
payment of central tax.

(6) The balance in the electronic cash ledger or electronic credit ledger

after payment of tax, interest, penalty, fee or any other amount payable under
this Act or the rules made thereunder may be refunded in accordance with
the provisions of section 54.

(7) All liabilities of a taxable person under this Act shall be recorded

and maintained in an electronic liability registered in such manner as may be
prescribed.

(8) Every taxable person shall discharge his tax and other dues under

this Act or the rules made thereunder in the following order, namely:
(a) self-assessed tax, and other dues related to returns of
previous tax periods;

(b) self-assessed tax, and other dues related to the return of the
current tax period;

(c) any other amount payable under this Act or the rules made
thereunder including the demand determined under section
73 or section 74.

(9) Every person who has paid the tax on goods or services or both

under this Act shall, unless the contrary is proved by him, be deemed to have
passed on the full incidence of such tax to the recipient of such goods or
services or both.

**Explanation:- For the purposes of this section,-**

(a) the date of credit to the account of the Government in the

authorised bank shall be deemed to be the date of deposit in
the electronic cash ledger.

(b) The expression,
(i) “tax dues” means the tax payable under this Act and does
not include interest, fee and penalty; and

(ii) “other dues” means interest, penalty, fee or any other

amount payable under this Act or the rules made

thereunder.


-----

**1[49A. Utilisation of input tax credit subject to certain conditions -**
Notwithstanding anything contained in section 49, the input tax credit on
account of State tax shall be utilised towards payment of integrated tax or
State tax as the case may be, only after the input tax credit available on
account of integrated tax has first been utilized fully towards such payment.

**49B. Order of utilization of input tax credit –** Notwithstanding anything
contained in this Chapter and subject to the provisions of clause (e) and
clause (f) of sub-section (5) of section 49, the Government may, on the
recommendations of the Council, prescribe the order and manner of
utilisation of the input tax credit on account of integrated tax, central tax,
State tax as the case may be, towards payment of any such tax.]

**50. Interest on delayed payment of tax- (1) Every person who is liable to**
pay tax in accordance with the provisions of this Act or the rules made there
under, but fails to pay the tax or any part thereof to the Government within
the period prescribed, shall for the period for which the tax or any part
thereof remains unpaid, pay on his own, interest at such rate, not exceeding
eighteen per cent., as may be notified by the Government on the
recommendations of the Council.

(2) The interest under sub-section (1) shall be calculated in such

manner as may be prescribed from the day succeeding the day on which such
tax was due to the paid.

(3) A taxable person who makes an undue or excess claim of input tax

credit under sub-section (10) of section 42 or undue or excess reduction in
output tax liability under sub-section (10) of section 43, shall pay interest on
such undue or excess claim or on such undue or excess reduction, as the
case may be, at such rate not exceeding twenty-four per cent., as may be
notified by the Government on the recommendations of the Council.

**51. Tax deduction at source- (1) Notwithstanding anything to the contrary**
contained in this Act, the Government may mandate,
(a) a department or establishment of the Central Government or

State Government; or

(b) local authority; or

(c) governmental agencies; or

1
Ins. by Act 23 of 2018, s.21 (w.e.f. 1-2-2019)


-----

(d) such persons or category of persons as may be notified by the

Government on the recommendations of the Council,

(hereafter in this section referred to as “the deductor”), to

deduct tax at the rate of one percent from the payment made or
credited to the supplier (hereafter in this section referred to as
“the deductee”) of taxable goods or services or both, where the
total value of such supply, under a contract, exceeds two lakh
and fifty thousand rupees:

Provided that no deduction shall be made if the location of

the supplier and the place of supply is in a State or Union
territory which is different from the State or, as the case may
be, Union territory of registration of the recipient.

**Explanation:- For the purpose of deduction of tax specified above, the value**
of supply shall be taken as the amount excluding the tax indicated in the
invoice.

(2) The amount deducted as tax under this section shall be paid to the

Government by the deductor within ten days after the end of the month in
which such deduction is made, in such manner as may be prescribed.

(3) The deductor shall furnish to the deductee a certificate mentioning

therein the contract value, rate of deduction, amount deducted, amount paid
to the Government and such other particulars in such manner as may be
prescribed.

(4) If any deductor fails to furnish to the deductee the certificate, after

deducting the tax at source, within five days of crediting the amount so
deducted to the Government, the deductor shall pay, by way of a late fee, a
sum of one hundred rupees per day from the day after the expiry of such five
days period until the failure is rectified, subject to a maximum amount of five
thousand rupees.

(5) The deductee shall claim credit, in his electronic cash ledger, of the

tax deducted and reflected in the return of the deductor furnished under subsection (3) of section 39, in such manner as may be prescribed.

(6) If any deductor fails to pay to the Government the amount deducted

as tax under sub-section (1), he shall pay interest in accordance with the
provisions of sub-section (1) of section 50, in addition to the amount of tax
deducted.

(7) The determination of the amount in default under this section shall

be made in the manner specified in section 73 or section 74.


-----

(8) The refund to the deductor or the deductee arising on account of

excess or erroneous deduction shall be dealt with in accordance with the
provisions of section 54:

Provided that no refund to the deductor shall be granted, if the amount

deducted has been credited to the electronic cash ledger of the deductee.

**52. Collection of tax at source- (1) Notwithstanding anything to the contrary**
contained in this Act, every electronic commerce operator (hereafter in this
section referred to as the “operator”), not being an agent, shall collect an
amount calculated at such rate not exceeding one percent, as may be notified
by the Government on the recommendations of the Council, of the net value
of taxable supplies made through it by other suppliers where the
consideration with respect to such suppliers is to be collected by the operator.

**Explanation:- For the purposes of this sub-section, the expression “net value**
of taxable supplies” shall mean the aggregate value of taxable supplies of
goods or services or both, other than services notified under sub-section (5) of
section 9, made during any month by all registered persons through the
operator reduced by the aggregate value of taxable supplies returned to the
suppliers during the said month.

(2) The power to collect the amount specified in sub-section (1) shall be

without prejudice to any other mode or recovery from the operator.

(3) The amount collected under sub-section (1) shall be paid to the

Government by the Operator within ten days after the end of the month in
which such collection is made, in such manner as may be prescribed.

(4) Every operator who collects the amount specified in sub-section (1)

shall furnish a statement, electronically, containing the details of outward
supplies of goods or services or both effected through it, including the
supplies of goods or services or both returned through it, and the amount
collected under sub-section (1) during a month, in such form and manner as
may be prescribed, within ten days after the end of such month.

(5) Every operator who collects the amount specified in sub-section (1)

shall furnish an annual statement, electronically, containing the details of
outward supplies of goods or services or both effected through it, including
the supplies of goods or services or both returned through it, and the amount
collected under the said sub-section during the financial year, in such form
and manner as may be prescribed, before the thirty first day of December
following the end of such financial year.


-----

(6) If any operator after furnishing a statement under sub-section (4)

discovers any omission or incorrect particulars therein, other than as a result
of scrutiny, audit, inspection or enforcement activity by the tax authorities, he
shall rectify such omission or incorrect particulars in the statement to be
furnished for the month during which such omission or incorrect particulars
are noticed, subject to payment of interest, as specified in sub-section (1) of
section 50:

Provided that no such rectification of any omission or incorrect

particular shall be allowed after the due date for furnishing of statement for
the month of September following the end of the financial year or the actual
date of furnishing of the relevant annual statement, whichever is earlier.

(7) The supplier who has supplied the goods or services or both

through the operator shall claim credit, in his electronic cash ledger, of the
amount collected and reflected in the statement of the operator furnished
under sub-section (4), in such manner as may be prescribed.

(8) The details of supplies furnished by every operator under sub
section (4) shall be matched with the corresponding details of outward
supplies furnished by the concerned supplier registered under this Act in
such manner and within such time as may be prescribed.

(9) Where the details of outward supplies furnished by the operator

under sub-section (4) do not match with the corresponding details furnished
by the supplier under [1][section 37 or section 39], the discrepancy shall be
communicated to both persons in such manner and within such time as may
be prescribed.

(10) The amount in respect of which any discrepancy is communicated

under sub-section (9) and which is not rectified by the supplier in his valid
return or the operator in his statement for the month in which discrepancy is
communicated, shall be added to the output tax liability of the said supplier,
where the value of outward supplies furnished by the operator is more than
the value of outward supplies furnished by the supplier, in his return for the
month succeeding the month in which the discrepancy is communicated in
such manner as may be prescribed.

(11) The concerned supplier, in whose output tax liability any amount

has been added under sub-section (10), shall pay the tax payable in respect of

1
Subs. by Act 23 of 2018, s.22, for the words ”section 37” (w.e.f. 1-2-2019)


-----

such supply along with interest, at the rate specified under sub-section (1) of
section 50 on the amount so added from the date such tax was due till the
date of its payment.

(12) Any authority not below the rank of Deputy Commissioner may

serve a notice, either before or during the course of any proceedings under
this Act, requiring the operator to furnish such details relating to,
(a) supplies of goods or services or both effected through such
operator during any period; or

(b) stock of goods held by the suppliers making supplies
through such operator in the godowns or warehouses, by
whatever name called, managed by such operators and
declared as additional places of business by such suppliers,
as may be specified in the notice.

(13) Every operator on whom a notice has been served under sub
section (12) shall furnish the required information within fifteen working days
of the date of service of such notice.

(14) Any person who fails to furnish the information required by the

notice served under sub-section (12) shall, without prejudice to any action
that may be taken under section 122, be liable to a penalty which may extend
to twenty five thousand rupees.

**Explanation:- For the purposes of this section, the expression ‘concerned**
supplier’ shall mean the supplier of goods or services or both making supplies
through the operator.

**53. Transfer of input tax credit- On utilisation of input tax credit availed**
under this Act for payment of tax dues under the Integrated Goods and
Services Tax Act, 2017 (Act No.13 of 2017) in accordance with sub-section (5)
of section 49, as reflected in the valid return furnished under sub-section (1)
of section 39, the amount collected as State tax shall stand reduced by an
amount equal to such credit so utilised and the State Government shall
transfer an amount equal to the amount so reduced from the State tax
account to the integrated tax account in such manner and within such time
as may be prescribed.

**CHAPTER XI**

**REFUNDS**

**54. Refund of tax-** (1) Any person claiming refund of any tax and interest
paid on such tax or any other amount paid by him, may make an application


-----

before the expiry of two years from the relevant date in such form and manner
as may be prescribed.

Provided that a registered person, claiming refund of any balance in the

electronic cash ledger as per sub-section (6) of section 49, may claim such
refund in the return furnished under section 39 in such manner as may be
prescribed.

(2) A specialized agency of the United Nations Organization or any

Multilateral Financial Institution and Organization notified under the United
Nations (Privileges and Immunities) Act, 1947, (Act No.46 of 1947) Consulate
or Embassy of foreign countries or any other person or class of persons as
notified under section 55 entitled to a refund of tax paid by it on inward
supplies of goods or services or both, may make an application for such
refund, in such form and manner as may be prescribed, before the expiry of
six months from the last day of the quarter in which such supply was
received.

(3) Subject to the provisions of sub-section (10), a registered person

may claim refund of any unutilised input tax credit at the end of any tax
period:

Provided that no refund of unutilised input tax credit shall be allowed

in cases other than,
(i) zero rated supplies made without payment of tax;

(ii) where the credit has accumulated on account of rate of tax on

inputs being higher than the rate of tax on output supplies
(other than nil rated or fully exempt supplies), except supplies
of goods or services or both as may be notified by the
Government on the recommendations of the Council:

Provided further that no refund of unutilised input tax credit shall be

allowed in cases where the goods exported out of India are subjected to export
duty:

Provided also that no refund of input tax credit shall be allowed, if the

supplier of goods or services or both claims refund of the integrated tax paid
on such supplies.

(4) The application shall be accompanied by,
(a) such documentary evidence as may be prescribed to establish

that a refund is due to the applicant; and


-----

(b) such documentary or other evidence (including the documents

referred to in section 33) as the applicant may furnish to
establish that the amount of tax and interest, if any, paid on
such tax or any other amount paid in relation to which such
refund is claimed was collected from or paid by, him and the
incidence of such tax and interest had not been passed on to
any other person:

Provided that where the amount claimed as refund is less than

two lakh rupees, it shall not be necessary for the applicant to furnish any
documentary and other evidences but he may file a declaration, based on the
documentary or other evidences available with him, certifying that the
incidence of such tax and interest had not been passed on to any other
person.

(5) If, no receipt of any such application, the proper officer is satisfied

that the whole or part of the amount claimed as refund is refundable, he may
make an order accordingly and the amount so determined shall be credited to
the fund referred to in section 57.

(6) Notwithstanding anything contained in sub-section (5), the proper

officer may, in the case of any claim for refund on account of zero rated
supply of goods or services or both made by registered persons, other than
such category of registered persons as may be notified by the Government on
the recommendations of the council refund on a provisional basis, ninety
percent of the total amount so claimed, excluding the amount of input tax
credit provisionally accepted, in such manner and subject to such conditions,
limitations and safeguards as may be prescribed and thereafter make an
order under sub-section (5) for final settlement of the refund claim after due
verification of documents furnished by the applicant.

(7) The proper officer shall issue the order under sub-section (5) within

sixty days from the date of receipt of application complete in all respects.

(8) Notwithstanding anything contained in sub-section (5), the

refundable amount shall, instead of being credited to the fund, be paid to the
applicant, if such amount is relatable to,
(a) refund of tax paid on [1][export] supplies of goods or services or

both or on inputs or input services used in making such
2[exports];

1
Subs. by Act 23 of 2018, s.23, for the words “zero-rated supplies” (w.e.f. 1-2-2019)

2
Subs. by Act 23 of 2018, s.23, for the words “zero-rated supplies” (w.e.f. 1-2-2019)


-----

(b) refund of unutilised input tax credit under sub-section (3);
(c) refund of tax paid on a supply which is not provided, either

wholly or partially, and for which invoice has not been issued,
or where a refund voucher has been issued;

(d) refund of tax in pursuance of section 77;

(e) the tax and interest, if any, or any other amount paid by the

applicant, if he had not passed on the incidence of such tax
and interest to any other person; or

(f) the tax or interest borne by such other class of applicants as

the Government may, on the recommendations of the Council,
by notification, specify.

(9) Notwithstanding anything to the contrary contained in any

judgment, decree, or direction of the Appellate Tribunal or any court or in any
other provisions of this Act or the rules made thereunder or in any other law
for the time being in force, no refund shall be made except in accordance with
the provisions of sub-section (8).

(10) Where any refund is due under sub-section (3) to a registered

person who has defaulted in furnishing any return or who is required to pay
any tax, interest or penalty, which has not been stayed by any court, Tribunal
or Appellate Authority by the specified date, the proper officer may,
(a) withhold payment of refund due until the said person has

furnished the return or paid the tax, interest or penalty, as
the case may be;

(b) deduct from the refund due, any tax, interest, penalty, fee or

any other amount which the taxable person is liable to pay
but which remains unpaid under this Act or under the
existing law.

**Explanation:- for the purposes of this sub-section, the expression “specified**
date” shall mean the last date for filing an appeal under this Act.

(11) Where an order giving rise to a refund is the subject matter of an

appeal or further proceedings or where any other proceedings under this Act
is pending and the Chief Commissioner is of the opinion that grant of such
refund is likely to adversely affect the revenue in the said appeal or other
proceedings on account of malfeasance or fraud committed, he may, after
giving the taxable person an opportunity of being heard, withhold the refund
till such time as he may determine.


-----

(12) Where a refund is withheld under sub-section (11), the taxable

person shall, notwithstanding anything contained in section 56, be entitled to
interest at such rate not exceeding six percent as may be notified on the
recommendations of the Council, if as a result of the appeal or further
proceedings he becomes entitled to refund.

(13) Notwithstanding anything to the contrary contained in this

section, the amount of advance tax deposited by a casual taxable person or a
non-resident taxable person under sub-section (2) of section 27, shall not be
refunded unless such person has, in respect of the entire period for which the
certificate of registration granted to him had remained in force, furnished all
the returns required under section 39.

(14) Notwithstanding anything contained in this section, no refund

under sub-section (5) or sub-section (6) shall be paid to an applicant, if the
amount is less than one thousand rupees.

**Explanation:- For the purposes of this section.-**

(1) “refund” includes refund of tax paid on zero rated supplies of

goods or services or both or on inputs or input services used
in making such supplies or refund of tax on the supply of
goods regarded as deemed exports, or refund of unutilised
input tax credit as provided under sub-section (3).

(2) “relevant date” means,
(a) in the case of goods exported out of India where a refund of

tax paid is available in respect of goods themselves or as the
case may be, the inputs or input services used in such goods,
(i) if the goods are exported by sea or air, the date on which

the ship or the aircraft in which such goods are loaded,
leaves India; or

(ii) if the goods are exported by land, the date on which such

goods pass the frontier; or

(iii) if the goods are exported by post, the date of despatch of

goods by the Post Office concerned to a place outside

India;

(b) in the case of supply of goods regarded as deemed exports

where a refund of tax paid is available in respect of the goods,
the date on which the return relating to such deemed exports
if furnished;

(c) in the case of services exported out of India where a refund of

tax paid is available in respect of services themselves or as the


-----

case may be, the inputs or input services used in such
services, the date of,
(i) receipt of payment in convertible foreign exchange [1][or in

Indian rupees wherever permitted by the Reserve Bank of
India] where the supply of services had been

completed prior to the receipt of such payment; or

(ii) issue of invoice, where payment for the services had been

received in advance prior to the date of issue of the invoice;

(d) in case where the tax becomes refundable as a consequence of

judgment, decree, order or direction of the Appellate
Authority, Appellate Tribunal or any court, the date of
communication of such judgment, decree, order or direction;

2[(e) in the case of refund of unutilised input tax credit under

clause (ii) of the first proviso to sub-section (3), the due date
for furnishing of return under section 39 for the period in
which such claim for refund arises];

(f) in the case where tax is paid provisionally under this Act or

the rules made thereunder, the date of adjustment of tax after
the final assessment thereof;

(g) in the case of a person, other than the supplier, the date of

receipt of goods or services or both by such person; and

(h) in any other case, the date of payment of tax.

**55.** **Refund** **in** **certain** **cases-** The Government, may, on the

recommendations of the Council by notification, specify any specialized
agency of the United Nations Organization or any Multilateral Financial
Institution and Organization notified under the United Nations (Privileges and
Immunities) Act, 1947 (Act No.46 of 1947) Consulate or Embassy of foreign
countries and any other person or class of persons as may be specified in this
behalf, who shall, subject to such conditions and restrictions as may be
prescribed, be entitled to claim a refund of taxes paid on the notified supplies
of goods or services or both received by them.

1
Ins. by Act 23 of 2018, s.23 (w.e.f. 1-2-2019)

2
Subs. by Act 23 of 2018, s.23, for sub clause (e) (w.e.f. 1-2-2019)


-----

**56. Interest on delayed refunds-** If any tax ordered to be refunded under
sub-section (5) of section 54 to any applicant is not refunded within sixty
days from the date of receipt of application under sub-section (1) of that
section, interest at such rate not exceeding six percent as may be specified in
the notification issued by the Government on the recommendations of the
Council shall be payable in respect of such refund from the date immediately
after the expiry of sixty days from the date of receipt of application under the
said sub-section till the date of refund of such tax:

Provided that where any claim of refund arises from an order passed by

an adjudicating authority or Appellate Authority or Appellate Tribunal or
Court which has attained finality and the same is not refunded within sixty
days from the date of receipt of application filed consequent to such order,
interest at such rate not exceeding nine percent as may be notified by the
Government on the recommendations of the Council shall be payable in
respect of such refund from the date immediately after the expiry of sixty days
from the date of receipt of application till the date of refund.

**Explanation:- For the purposes of this section, where any order of refund is**
made by an Appellate Authority, Appellate Tribunal or any court against an
order of the proper officer under sub-section (5) of section 54, the order
passed by the Appellate Authority, Appellate Tribunal or by the court shall be
deemed to be an order passed under the said sub-section (5).

**57. Consumer Welfare Fund- The Government shall constitute a Fund, to be**
called the Consumer Welfare Fund and there shall be credited to the Fund,
(a) the amount referred to in sub-section (5) of section 54;

(b) any income from investment of the amount credited to the

Fund; and

(c) such other monies received by it, in such manner as may

be prescribed.

**58. Utilisation of Fund- (1)** All sums credited to the Fund shall be utilised

by the Government for the welfare of the consumers in such manner as may
be prescribed.

(2) The Government or the authority specified by it shall maintain

proper and separate account and other relevant records in relation to the
Fund and prepare an annual statement of accounts in such form as may be
prescribed in consultation with the Comptroller and Auditor-General of India.


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**CHAPTER – XII**

**ASSESSMENT**

**59. Self-Assessment-** Every registered person shall self assess the taxes

payable under this Act and furnish a return for each tax period as specified

under section 39.

**60. Provisional Assessment- (1) Subject to the provisions of sub-section (2),**
where the taxable person is unable to determine the value of goods or services
or both or determine the rate of tax applicable thereto, he may request the
proper officer in writing giving reasons for payment of tax on a provisional
basis and the proper officer shall pass an order, within a period not later than
ninety days from the date of receipt of such request, allowing payment of tax
on provisional basis at such rate or on such value as may be specified by him.

(2) The payment of tax on provisional basis may be allowed, if the

taxable person executes a bond in such form as may be prescribed, and with
such surety or security as the proper officer may deem fit, binding the taxable
person for payment of the difference between the amount of tax as may be
finally assessed and the amount of tax provisionally assessed.

(3) The proper officer shall, within a period not exceeding six months

from the date of the communication of the order issued under sub-section (1),
pass the final assessment order after taking into account such information as
may be required for finalizing the assessment:

Provided that the period specified in this sub-section may, on sufficient

cause being shown and for reasons to be recorded in writing, be extended by
the Joint Commissioner or Additional Commissioner for a further period not
exceeding six months and by the Chief Commissioner for such further period
not exceeding four years.

(4) The registered person shall be liable to pay interest on any tax

payable on the supply of goods or services or both under provisional
assessment but not paid on the due date specified under sub-section (7) of
section 39 or the rules made thereunder, at the rate specified under subsection (1) of section 50, from the first day after the due date of payment of
tax in respect of the said supply of goods or services or both till the date of
actual payment, whether such amount is paid before or after the issuance of
order for final assessment.


-----

(5) Where the registered person is entitled to a refund consequent to

the order of final assessment under sub-section (3), subject to the provisions
of sub-section (8) of section 54, interest shall be paid on such refund as
provided in section 56.

**61. Scrutiny of returns- (1) The proper officer may scrutinize the return**
and related particulars furnished by the registered person to verify the
correctness of the return and inform him of the discrepancies noticed, if any,
in such manner as may be prescribed and seek his explanation thereto.

(2) In case the explanation is found acceptable, the registered person

shall be informed accordingly and no further action shall be taken in this
regard.

(3) In case no satisfactory explanation is furnished within a period of

thirty days of being informed by the proper officer or such further period as
may be permitted by him or where the registered person, after accepting the
discrepancies, fails to take the corrective measure in his return for the month
in which the discrepancy is accepted, the proper officer may initiate
appropriate action including those under section 65 or section 66 or section
67, or proceed to determine the tax and other dues under section 73 or
section 74.

**62. Assessment of non-filers of returns-** (1) Notwithstanding anything to
the contrary contained in section 73 or section 74, where a registered person
fails to furnish the return under section 39 or section 45, even after the
service of a notice under section 46, the proper officer may proceed to assess
the tax liability of the said person to the best of his judgment taking into
account all the relevant material which is available or which he has gathered
and issue an assessment order within a period of five years from the date
specified under section 44 for furnishing of the annual return for the financial
year to which the tax not paid relates.

(2) Where the registered person furnishes a valid return within thirty

days of the service of the assessment order under sub-section (1), the said
assessment order shall be deemed to have been withdrawn but the liability for
payment of interest under sub-section (1) of section 50 or for payment of late
fee under section 47 shall continue.

**63.** **Assessment of unregistered persons- Notwithstanding anything to the**
contrary contained in section 73 or section 74, where a taxable person fails
to obtain registration even though liable to do so or whose registration has
been cancelled under sub-section (2) of section 29 but who is liable to pay
tax, the proper officer may proceed to assess the tax liability of such taxable
person to the best of his judgment for the relevant tax periods and issue an


-----

assessment order within a period of five years from the date specified under
section 44 for furnishing of the annual return for the financial year to which
the tax not paid relates:

Provided that no such assessment order shall be passed without giving

the person an opportunity of being heard

**64. Summary assessment in certain special cases-** (1) The proper officer
may, on any evidence showing a tax liability of a person coming to his notice,
with the previous permission of Additional Commissioner or Joint
Commissioner, proceed to assess the tax liability of such person to
protect the interest of revenue and issue an assessment order, if he has
sufficient grounds to believe that any delay in doing so may adversely affect
the interest of revenue:

Provided that where the taxable person to whom the liability pertains is

not ascertainable and such liability pertains to supply of goods, the person in
charge of such goods shall be deemed to be the taxable person liable to be
assessed and liable to pay tax and any other amount due under this section.

(2) On an application made by the taxable person within thirty days

from the date of receipt of order passed under sub-section (1) or on his own
motion, if the Additional Commissioner or Joint Commissioner considers
that such order is erroneous, he may withdraw such order and follow the
procedure laid down in section 73 or section 74.

**CHAPTER XIII**

**AUDIT**

**65. Audit by tax authorities-** (1) The Chief Commissioner or any officer
authorised by him, by way of a general or a specific order, may undertake
audit of any registered person for such period, at such frequency and in such
manner as may be prescribed.

(2) The officers referred to in sub-section (1) may conduct audit at the

place of business of the registered person or in their office.

(3) The registered person shall be informed, by way of a notice not less

than fifteen working days prior to the conduct of audit in such manner as
may be prescribed.

(4) The  audit  under  sub-section  (1)  shall  be completed within a

period of three months from the date of commencement of the audit:

Provided that where the Chief Commissioner is satisfied that audit in


-----

respect of such registered person cannot be completed within three months,
he may, for the reasons to be recorded in writing, extend the period by a
further period not exceeding six months.

**Explanation:-** For the purposes of this sub-section the expression

“commencement of audit” shall mean the date on which the records and other
documents, called for by the tax authorities, are made available by the
registered person or the actual institution of audit at the place of business,
whichever is later.

(5) During the course of audit, the authorised officer may require the
registered person,
(i) to afford him the necessary facility to verify the books of

account or other documents as he may require;

(ii) to furnish such information as he may require and render

assistance for timely completion of the audit.

(6) On conclusion of audit, the proper officer shall, within thirty days,

inform the registered person, whose records are audited, about the findings,
his rights and obligations and the reasons for such findings.

(7) Where the audit conducted under sub-section (1) results in

detection of tax not paid or short paid or erroneously refunded, or input tax
credit wrongly availed or utilised, the proper officer may initiate action under
section 73 or section 74.

**66.** **Special Audit- (1) If at any stage of scrutiny, inquiry, investigation or**
any other proceedings before him, any officer not below the rank of Assistant
Commissioner, having regard to the nature and complexity of the case and
the interest of revenue, is of the opinion that the value has not been correctly
declared or the credit availed is not within the normal limits, he may, with the
prior approval of the Chief Commissioner, direct such registered person by a
communication in writing to get his records including books of account
examined and audited by a chartered accountant or a cost accountant as
may be nominated by the Chief Commissioner.

(2) The chartered accountant or cost accountant so nominated shall,

within the period of ninety days, submit a report of such audit duly signed
and certified by him to the said Assistant Commissioner mentioning therein
such other particulars as may be specified:

Provided that the Assistant Commissioner may, on an application made

to him in this behalf by the registered person or the chartered accountant or
cost accountant or for any material and sufficient reason, extend the said
period by a further period of ninety days.


-----

(3) The provisions of sub-section (1) shall have effect notwithstanding

that the accounts of the registered person have been audited under any other
provisions of this Act or any other law for the time being in force.

(4) The registered person shall be given an opportunity of being heard

in respect of any material gathered on the basis of special audit under subsection (1) which is proposed to be used in any proceedings against him
under this Act or the rules made thereunder.

(5) The expenses of the examination and audit of records under sub
section (1), including the remuneration of such chartered accountant or cost
accountant, shall be determined and paid by the Chief Commissioner and
such determination shall be final.

(6) Where the special audit conducted under sub-section (1) results in

detection of tax not paid or short paid or erroneously refunded, or input tax
credit wrongly availed or utilised, the proper officer may initiate action under
section 73 or section 74.

**CHAPTER XIV**

**INSPECTION, SEARCH, SEIZURE AND ARREST**

**67.** **Power of inspection, search and seizure-** (1) Where the proper officer,
not below the rank of Joint Commissioner, has reasons to believe that––

(a) a taxable person has suppressed any transaction relating

to supply of goods or services or both or the stock of goods
in hand, or has claimed input tax credit in excess of his
entitlement under this Act or has indulged in

contravention of any of the provisions of this Act or the
rules made thereunder to evade tax under this Act; or

(b) any person engaged in the business of transporting goods
or an owner or operator of a warehouse or a godown or
any other place is keeping goods which have escaped
payment of tax or has kept his accounts or goods in such
a manner as is likely to cause evasion of tax payable
under this Act, he may authorise in writing any other
officer of State tax to inspect any places of business of the
taxable person or the persons engaged in the business of
transporting goods or the owner or the operator of
warehouse or godown or any other place.

(2) Where the proper officer, not below the rank of Joint Commissioner,


-----

either pursuant to an inspection carried out under sub-section (1) or
otherwise, has reasons to believe that any goods liable to confiscation or any
documents or books or things, which in his opinion shall be useful for or
relevant to any proceedings under this Act, are secreted in any place, he may
authorise in writing any other officer of State tax to search and seize or may
himself search and seize such goods, documents or books or things:

Provided that where it is not practicable to seize any such goods, the

proper officer or any officer authorised by him, may serve on the owner or the
custodian of the goods an order that he shall not remove, part with, or
otherwise deal with the goods except with the previous permission of such
officer:

Provided further that the documents or books or things so seized shall

be retained by such officer only for so long as may be necessary for their
examination and for any inquiry or proceedings under this Act.

(3) The documents, books or things referred to in sub-section (2) or

any other documents, books or things produced by a taxable person or any
other person, which have not been relied on for the issue of notice under this
Act or the rules made thereunder, shall be returned to such person within a
period not exceeding thirty days of the issue of the said notice.

(4) The officer authorised under sub-section (2) shall have the power to

seal or break open the door of any premises or to break open any almirah,
electronic devices, box, receptacle in which any goods, accounts, registers or
documents of the person are suspected to be concealed, where access to such
premises, almirah, electronic devices, box or receptacle is denied.

(5) The person from whose custody any documents are seized under

sub-section (2) shall be entitled to make copies thereof or take extracts there
from in the presence of an authorised officer at such place and time as such
officer may indicate in this behalf except where making such copies or taking
such extracts may, in the opinion of the proper officer, prejudicially affect the
investigation.

(6) The goods so seized under sub-section (2) shall be released, on a

provisional basis, upon execution of a bond and furnishing of a security, in
such manner and of such quantum, respectively, as may be prescribed or on
payment of applicable tax, interest and penalty payable, as the case may be.

(7) Where any goods are seized under sub-section (2) and no notice in

respect thereof is given within six months of the seizure of the goods, the
goods shall be returned to the person from whose possession they were
seized:


-----

Provided that the period of six months may, on sufficient cause being

shown, be extended by the proper officer for a further period not exceeding six
months.

(8) The Government may, having regard to the perishable or

hazardous nature of any goods, depreciation in the value of the goods with
the passage of time, constraints of storage space for the goods or any other
relevant considerations, by notification, specify the goods or class of goods
which shall, as soon as may be after its seizure under sub-section (2), be
disposed of by the proper officer in such manner as may be prescribed.

(9) Where any goods, being goods specified under sub-section (8),

have been seized by a proper officer or any officer authorised by him,
under sub-section (2), he shall prepare an inventory of such goods in such
manner as may be prescribed

(10) The provisions of the Code of Criminal Procedure, 1973, (Act

No. 2 of 1974) (12) relating to search and seizure, shall, so far as may be,
apply to search and seizure under this section subject to the modification
that sub-section (5) of section 165 of the said Code shall have effect as if for
the word “Magistrate”, wherever it occurs, the word “Chief Commissioner”
were substituted.

(11) Where the proper officer has reasons to believe that any

person has evaded or is attempting to evade the payment of any tax, he
may, for reasons to be recorded in writing, seize the accounts, registers or
documents of such person produced before him and shall grant a
receipt for the same, and shall retain the same for so long as may be
necessary in connection with any proceedings under this Act or the rules
made thereunder for prosecution.

(12) The Chief Commissioner or an officer authorised by him may

cause purchase of any goods or services or both by any person authorised by
him from the business premises of any taxable person, to check issue of tax
invoices or bills of supply by such taxable person, and on return of goods so
purchased by such officer, such taxable person or any person in charge of the
business premises shall refund the amount so paid towards the goods after
cancelling any tax invoice or bill of supply issued earlier.

**68.** **Inspection of goods in movement- (1) The Government may require**
the person in charge of a conveyance carrying any consignment of goods of
value exceeding such amount as may be specified to carry with him such
documents and such devices as may be prescribed.


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(2) The details of documents required to be carried under sub-section

(1) shall be validated in such manner as may be prescribed.

(3) Where any conveyance referred to in sub-section (1) is intercepted

by the proper officer at any place, he may require the person in charge of the
said conveyance to produce the documents prescribed under the said subsection and devices for verification, and the said person shall be liable to
produce the documents and devices and also allow the inspection of goods.

**69. Power of arrest-** (1) Where the Chief Commissioner has reasons to
believe that any person has committed any offence specified in clause (a) or
clause (b) or clause (c) or clause (d) of sub-section (1) of section 132 which is
punishable under clause (i) or (ii) of sub-section (1) or sub-section (2) of the
said section, he may, by order, authorise any officer of State tax to arrest
such person.

(2) Where a person is arrested under sub-section (1) for an offence

specified under sub-section (5) of section 132, the officer authorised to arrest
the person shall inform such person of the grounds of arrest and produce him
before a Magistrate within twenty four hours.

(3) Subject to the provisions of the Code of Criminal Procedure, 1973,
Act No.2 of 1974.

(a) where a person is arrested under sub-section (1) for any

offence specified under sub-section (4) of section 132, he
shall be admitted to bail or in default of bail, forwarded to the
custody of the Magistrate;

(b)  in the case of a non-cognizable and bailable offence, the

Deputy Commissioner or the Assistant Commissioner
shall, for the purpose of releasing an arrested person on
bail or otherwise, have the same powers and be subject
to the same provisions as an officer-in-charge of a police
station.

**70. Power to summon persons to give evidence and produce documents-**
(1) The proper officer under this Act shall have power to summon any

person whose attendance he considers necessary either to give evidence or to
produce a document or any other thing in any inquiry in the same manner,
as provided in the case of a civil court under the provisions of the Code of
Civil Procedure, 1908. (Act No.5 of 1908).

(2) Every such inquiry referred to in sub-section (1) shall be deemed

to be a “judicial proceedings” within the meaning of section 193 and section
228 of the Indian Penal Code, 1860. (Act No.45 of 1860).


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**71.** **Access to business premises- (1) Any officer under this Act,**
authorized by the proper  officer  not  below  the  rank  of  Joint
Commissioner, shall have access to any place of business of a registered
person to inspect books of account, documents, computers, computer
programs, computer software whether installed in a computer or otherwise
and such other things as he may require and which may be available at
such place, for the purposes of carrying out any audit, scrutiny,
verification and checks as may be necessary to safeguard the interest of
revenue.

(2) Every person in charge of place referred to in sub- section (1) shall,

on demand, make available to the officer authorised under sub-section (1) or
the audit party deputed by the proper officer or a cost accountant or
chartered accountant nominated under section 66,––

(i) such records as prepared or maintained by the registered
person and declared to the proper officer in such manner as
may be prescribed;

(ii)  trial balance or its equivalent;

(iii) statements of annual financial accounts, duly audited,

wherever required;

(iv) cost audit report, if any, under section 148 of the Companies

Act, 2013; (Act No.18 of 2013).

(v) the income-tax audit report, if any, under section 44AB of
the Income-tax Act, 1961; (Act No.43 of 1961) and

(vi) any other relevant record, for the scrutiny by the officer or

audit party or the chartered accountant or cost accountant
within a period not exceeding fifteen working days from the
day when such demand is made, or such further period as
may be allowed by the said officer or the audit party or the
chartered accountant or cost accountant.

**72.** **Officers to assist proper officers-** (1) All officers of Police, Railways,
Customs, and those engaged in the collection of land revenue, including
village officers, and officers of central tax and officers of the Union territory
tax shall assist the proper officers in the implementation of this Act.

(2) The Government may, by notification, empower and require any

other class of officers to assist the proper officers in the implementation of
this Act when called upon to do so by the Chief Commissioner.

**CHAPTER XV**


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**DEMANDS AND RECOVERY**

**73.** **Determination of tax not paid or short paid or erroneously refunded**
**or input tax credit wrongly availed or utilised for any reason other than**
**fraud or any willful misstatement of facts- (1) Where it appears to the**
proper officer that any tax has not been paid or short paid or
erroneously refunded, or where input tax credit has been wrongly availed or
utilised for any reason, other than the reason of fraud or any willfulmisstatement or suppression of facts to evade tax, he shall serve notice on
the person chargeable with tax which has not been so paid or which has been
so short paid or to whom the refund has erroneously been made, or who has
wrongly availed or utilised input tax credit, requiring him to show cause why
he should not pay the amount specified in the notice along with interest
payable thereon under section 50 and a penalty leviable under the provisions
of this Act or the rules made thereunder.

(2) The proper officer shall issue the notice under sub-section (1) at

least three months prior to the time limit specified in sub-section (10) for
issuance of order.

(3) Where a notice has been issued for any period under sub-section

(1), the proper officer may serve a statement, containing the details of tax
not paid or short paid or erroneously refunded or input tax credit wrongly
availed or utilised for such periods other than those covered under subsection (1), on the person chargeable with tax.

(4) The service of such statement shall be deemed to be service of

notice on such person under sub- section (1), subject to the condition
that the grounds relied upon for such tax periods other than those covered
under sub-section (1) are the same as are mentioned in the earlier notice.

(5) The person chargeable with tax may, before service of notice under

sub-section (1) or, as the case may be, the statement under sub-section (3)
pay the amount of tax along with interest payable thereon under section 50
on the basis of his own ascertainment of such tax or the tax as ascertained by
the proper officer and inform the proper officer in writing of such payment.

(6) The proper officer, on receipt of such information, shall not serve

any notice under sub-section (1) or, as the case may be, the statement under
sub-section (3), in respect of the tax so paid or any penalty payable under the
provisions of this Act or the rules made thereunder.

(7) Where the proper officer is of the opinion that the amount paid

under sub-section (5) falls short of the amount actually payable, he shall
proceed to issue the notice as provided for in sub-section (1) in respect of


-----

such amount which falls short of the amount actually payable.

(8) Where any person chargeable with tax under sub-section (1) or

sub-section (3) pays the said tax along with interest payable under section 50
within thirty days of issue of show cause notice, no penalty shall be payable
and all proceedings in respect of the said notice shall be deemed to be
concluded.

(9) The proper officer shall, after considering the representation, if any,

made by person chargeable with tax, determine the amount of tax, interest
and a penalty equivalent to ten per cent of tax or ten thousand rupees,
whichever is higher, due from such person and issue an order.

(10) The proper officer shall issue the order under sub-section (9)

within three years from the due date for furnishing of annual return for the
financial year to which the tax not paid or short paid or input tax credit
wrongly availed or utilised relates to or within three years from the date of
erroneous refund.

(11) Notwithstanding anything contained in sub-section (6) or sub
section (8), penalty under sub-section (9) shall be payable where any amount
of self-assessed tax or any amount collected as tax has not been paid within a
period of thirty days from the due date of payment of such tax.

**74.** **Determination of tax not paid or short paid or erroneously refunded**
**or input tax credit wrongly availed or utilised by reason of fraud or any**
**willful-misstatement or suppression of facts- (1) Where it appears to the**
proper officer that any tax has not been paid or short paid or
erroneously refunded or where input tax credit has been wrongly availed or
utilised by reason of fraud, or any willful- misstatement or suppression of
facts to evade tax, he shall serve notice on the person chargeable with tax
which has not been so paid or which has been so short paid or to whom the
refund has erroneously been made, or who has wrongly availed or utilised
input tax credit, requiring him to show cause why he should not pay the
amount specified in the notice along with interest payable thereon under
section 50 and a penalty equivalent to the tax specified in the notice.

(2) The proper officer shall issue the notice under sub-section (1) at

least six months prior to the time limit specified in sub-section (10) for
issuance of order.

(3) Where a notice has been issued for any period under sub-section

(1), the proper officer may serve a statement, containing the details of tax
not paid or short paid or erroneously refunded or input tax credit
wrongly availed or utilised for such periods other than those covered under


-----

sub- section (1), on the person chargeable with tax.

(4) The service of statement under sub-section (3) shall be deemed to

be service of notice under sub- section (1) of section 73, subject to the
condition that the grounds relied upon in the said statement, except the
ground of fraud, or any wilful-misstatement or suppression of facts to evade
tax, for periods other than those covered under sub-section (1) are the same
as are mentioned in the earlier notice.

(5) The person chargeable with tax may, before service of notice under

sub-section (1), pay the amount of tax along with interest payable under
section 50 and a penalty equivalent to fifteen per cent of such tax on the
basis of his own ascertainment of such tax or the tax as ascertained by the
proper officer and inform the proper officer in writing of such payment.

(6) The proper officer, on receipt of such information, shall not serve

any notice under sub-section (1), in respect of the tax so paid or any penalty
payable under the provisions of this Act or the rules made thereunder.

(7) Where the proper officer is of the opinion that the amount paid

under sub-section (5) falls short of the amount actually payable, he shall
proceed to issue the notice as provided for in sub-section (1) in respect of
such amount which falls short of the amount actually payable.

(8) Where any person chargeable with tax under sub-section (1) pays

the said tax along with interest payable under section 50 and a penalty
equivalent to twenty five per cent of such tax within thirty days of issue of the
notice, all proceedings in respect of the said notice shall be deemed to be
concluded.

(9) The proper officer shall, after considering the representation, if any,

made by the person chargeable with tax, determine the amount of tax,
interest and penalty due from such person and issue an order.

(10) The proper officer shall issue the order under sub-section (9)

within a period of five years from the due date for furnishing of annual return
for the financial year to which the tax not paid or short paid or input tax
credit wrongly availed or utilised relates to or within five years from the date
of erroneous refund.

(11) Where any person served with an order issued under sub-section

(9) pays the tax along with interest payable thereon under section 50 and a
penalty equivalent to fifty per cent of such tax within thirty days of
communication of the order, all proceedings in respect of the said notice shall
be deemed to be concluded.


-----

**Explanation-I:-** For the purposes of section 73 and this section,
(i) the expression “all proceedings in respect of the said notice”

shall not include proceedings under section 132;

(ii) where the notice under the same proceedings is issued to the

main person liable to pay tax and some other persons, and
such proceedings against the main person have been
concluded under section 73 or section 74, the proceedings
against all the persons liable to pay penalty under sections
122, 125, 129 and 130 are deemed to be concluded.

**Explanation II:-** For the purposes of this Act, the expression
“suppression” shall mean non-declaration of facts or information which a
taxable person is required to declare in the return, statement, report or
any other document furnished under this Act or the rules made thereunder,
or failure to furnish any information on being asked for, in writing, by the
proper officer.

**75.** **General provisions relating to determination of tax-**
(1) Where the service of notice or issuance of order is stayed by an

order of a court or Appellate Tribunal, the period of such stay shall be
excluded in computing the period specified in sub-sections (2) and (10) of
section 73 or sub-sections (2) and (10) of section 74, as the case may be.

(2) Where any Appellate Authority or Appellate Tribunal or court

concludes that the notice issued under sub-section (1) of section 74 is
not sustainable for the reason that the charges of fraud or any willful misstatement or suppression of facts to evade tax has not been established
against the person to whom the notice was issued, the proper officer shall
determine the tax payable by such person, deeming as if the notice were
issued under sub-section (1) of section 73.

(3) Where any order is required to be issued in pursuance of

the direction of the Appellate Authority or Appellate Tribunal or a court,
such order shall be issued within two years from the date of communication
of the said direction.

(4) An opportunity of hearing shall be granted where a request is

received in writing from the person chargeable with tax or penalty, or where
any adverse decision is contemplated against such person.

(5) The proper officer shall, if sufficient cause is shown by the

person chargeable with tax, grant time to the said person and adjourn the
hearing for reasons to be recorded in writing:


-----

Provided that no such adjournment shall be granted for more than

three times to a person during the proceedings.

(6) The proper officer, in his order, shall set out the relevant facts

and the basis of his decision.

(7) The amount of tax, interest and penalty demanded in the order

shall not be in excess of the amount specified in the notice and no demand
shall be confirmed on the grounds other than the grounds specified in the
notice.

(8) Where the Appellate Authority or Appellate Tribunal or court

modifies the amount of tax determined by the proper officer, the amount of
interest and penalty shall stand modified accordingly, taking into account the
amount of tax so modified.

(9) The interest on the tax short paid or not paid shall be payable

whether or not specified in the order determining the tax liability.

(10) The adjudication proceedings shall be deemed to be concluded, if

the order is not issued within three years as provided for in sub-section (10)
of section 73 or within five years as provided for in sub-section (10) of section
74.

(11) An issue on which the Appellate Authority or the Appellate

Tribunal or the High Court has given its decision which is prejudicial to the
interest of revenue in some other proceedings and an appeal to the Appellate
Tribunal or the High Court or the Supreme Court against such decision of the
Appellate Authority or the Appellate Tribunal or the High Court is pending,
the period spent between the date of the decision of the Appellate Authority
and that of the Appellate Tribunal or the date of decision of the Appellate
Tribunal and that of the High Court or the date of the decision of the High
Court and that of the Supreme Court shall be excluded in computing the
period referred to in sub-section (10) of section 73 or sub-section (10) of
section 74 where proceedings are initiated by way of issue of a show cause
notice under said sections.

(12) Notwithstanding anything contained in section 73 or section 74,

where any amount of self-assessed tax in accordance with a return furnished
under section 39 remains unpaid, either wholly or partly, or any amount of
interest payable on such tax remains unpaid, the same shall be recovered
under the provisions of section 79.

(13) Where any penalty is imposed under section 73 or section 74, no

penalty for the same act or omission shall be imposed on the same person


-----

under any other provision of this Act.

**76. Tax collected but not paid to Government-** (1) Notwithstanding
anything to the contrary contained in any order or direction of any Appellate
Authority or Appellate Tribunal or court or in any other provisions of this Act
or the rules made thereunder or any other law for the time being in force,
every person who has collected from any other person any amount as
representing the tax under this Act, and has not paid the said amount to the
Government, shall forthwith pay the said amount to the Government,
irrespective of whether the supplies in respect of which such amount was
collected are taxable or not.

(2) Where any amount is required to be paid to the Government under

sub-section (1), and which has not been so paid, the proper officer may serve
on the person liable to pay such amount a notice requiring him to show cause
why the said amount as specified in the notice, should not be paid by him to
the Government and why a penalty equivalent to the amount specified in the
notice should not be imposed on him under the provisions of this Act.

(3) The proper officer shall, after considering the representation, if any,

made by the person on whom the notice is served under sub-section (2),
determine the amount due from such person and thereupon such person
shall pay the amount so determined.

(4) The person referred to in sub-section (1) shall in addition to paying

the amount referred to in sub-section (1) or sub-section (3) also be liable to
pay interest thereon at the rate specified under section 50 from the date such
amount was collected by him to the date such amount is paid by him to the
Government.

(5) An opportunity of hearing shall be granted where a request is

received in writing from the person to whom the notice was issued to show
cause.

(6) The proper officer shall issue an order within one year from the date

of issue of the notice.

(7) Where the issuance of order is stayed by an order of the court or

Appellate Tribunal, the period of such stay shall be excluded in computing
the period of one year.

(8) The proper officer, in his order, shall set out the relevant facts and

the basis of his decision.

(9) The amount paid to the Government under sub-section (1) or sub
section (3) shall be adjusted against the tax payable, if any, by the person in


-----

relation to the supplies referred to in sub-section (1).

(10) Where any surplus is left after the adjustment under sub-section

(9), the amount of such surplus shall either be credited to the Fund or
refunded to the person who has borne the incidence of such amount.

(11) The person who has borne the incidence of the amount, may apply

for the refund of the same in accordance with the provisions of section 54.

**77.** **Tax wrongfully collected and paid to Central Government or State**
**Government-**
(1) A registered person who has paid the central tax and State tax on a

transaction considered by him to be an intra-State supply, but which is
subsequently held to be an inter-State supply, shall be refunded the amount
of taxes so paid in such manner and subject to such conditions as may be
prescribed.

(2) A registered person who has paid integrated tax on a transaction

considered by him to be an inter-State supply, but which is subsequently
held to be an intra-State supply, shall not be required to pay any interest on
the amount of State tax payable.

**78.** **Initiation of recovery proceedings- Any amount payable by a taxable**
person in pursuance of an order passed under this Act shall be paid by such
person within a period of three months from the date of service of such order
failing which recovery proceedings shall be initiated:

Provided that where the proper officer considers it expedient in the

interest of revenue, he may, for reasons to be recorded in writing, require the
said taxable person to make such payment within such period less than a
period of three months as may be specified by him.

**79.** **Recovery of tax-**

(1) Where any amount payable by a person to the Government under

any of the provisions of this Act or the rules made thereunder is not paid, the
proper officer shall proceed to recover the amount by one or more of the
following modes, namely:
(a) the proper officer may deduct or may require any other

specified officer to deduct the amount so payable from any
money owing to such person which may be under the control of
the proper officer or such other specified officer;


-----

(b) the proper officer may recover or may require any other

specified officer to recover the amount so payable by detaining
and selling any goods belonging to such person which are
under the control of the proper officer or such other specified
officer;

(c) (i) the proper officer may, by a notice in writing, require any

other person from whom money is due or may become due to
such person or who holds or may subsequently hold money for
or on account of such person, to pay to the Government either
forthwith upon the money becoming due or being held, or
within the time specified in the notice not being before the
money becomes due or is held, so much of the money as is
sufficient to pay the amount due from such person or the
whole of the money when it is equal to or less than that
amount;

(ii) every person to whom the notice is issued under sub-clause

(i) shall be bound to comply with such notice, and in
particular, where any such notice is issued to a post office,
banking company or an insurer, it shall not be necessary to
produce any pass book, deposit receipt, policy or any other
document for the purpose of any entry, endorsement or the
like being made before payment is made, notwithstanding
any rule, practice or requirement to the contrary;

(iii) in case the person to whom a notice under sub-clause (i)

has been issued, fails to make the payment in pursuance
thereof to the Government, he shall be deemed to be a
defaulter in respect of the amount specified in the notice
and all the consequences of this Act or the rules made
there under shall follow;

(iv) the officer issuing a notice under sub-clause (i) may, at any

time, amend or revoke such notice or extend the time for
making any payment in pursuance of the notice;

(v) any person making any payment in compliance with a

notice issued under sub-clause (i) shall be deemed to have
made the payment under the authority of the person in
default and such payment being credited to the

Government shall be deemed to constitute a good and
sufficient discharge of the liability of such person to the
person in default to the extent of the amount specified in
the receipt;


-----

(vi) any person discharging any liability to the person in default

after service on him of the notice issued under sub-clause
(i) shall be personally liable to the Government to the extent
of the liability discharged or to the extent of the liability of
the person in default for tax, interest and penalty,
whichever is less;

(vii) where a person on whom a notice is served under sub
clause (i) proves to the satisfaction of the officer issuing the
notice that the money demanded or any part thereof was
not due to the person in default or that he did not hold any
money for or on account of the person in default, at the
time the notice was served on him, nor is the money
demanded or any part thereof, likely to become due to the
said person or be held for or on account of such person,
nothing contained in this section shall be deemed to require
the person on whom the notice has been served to pay to
the Government any such money or part thereof;

(d) the proper officer may, in accordance with the rules to be made

in this behalf, distrain any movable or immovable property
belonging to or under the control of such person, and detain
the same until the amount payable is paid; and in case, any
part of the said amount payable or of the cost of the distress or
keeping of the property, remains unpaid for a period of thirty
days next after any such distress, may cause the said property
to be sold and with the proceeds of such sale, may satisfy the
amount payable and the costs including cost of sale remaining
unpaid and shall render the surplus amount, if any, to such
person;

(e) the proper officer may prepare a certificate signed by him

specifying the amount due from such person and send it to the
Collector of the district in which such person owns any
property or resides or carries on his business or to any officer
authorised by the Government and the said Collector or the
said officer, on receipt of such certificate, shall proceed to
recover from such person the amount specified thereunder
as if it were an arrear of land revenue;

(f) Notwithstanding anything contained in the Code of Criminal

Procedure, 1973, (Act 2 of 1974) the proper officer may file an
application to the appropriate Magistrate and such Magistrate
shall proceed to recover from such person the amount specified
thereunder as if it were a fine imposed by him.


-----

(2) Where the terms of any bond or other instrument executed  under

this Act  or  any  rules  or regulations made thereunder provide that
any amount due under such instrument may be recovered in the manner
laid down in sub-section (1), the amount may, without prejudice to any other
mode  of  recovery,  be  recovered  in accordance with the provisions of
that sub-section.

(3) Where any amount of tax, interest or penalty is payable by a person

to the Government under any of the provisions of this Act or the rules made
thereunder and which remains unpaid, the proper officer of central tax,
during the course of recovery of said tax arrears, may recover the
amount from the said person as if it were an arrear of central tax and credit
the amount so recovered to the account of the Government.

(4) Where the amount recovered under sub-section (3) is less than

the amount due to the Central Government and State Government, the
amount to be credited to the account of the respective Governments shall be
in proportion to the amount due to each such Government.

1[Explanation.––For the purposes of this section, the word person shall

include “distinct persons” as referred to in sub-section (4) or, as the case may
be, sub-section (5) of section 25].

**80.** **Payment of tax and other amount in instalments-** On an
application filed by a taxable person, the Chief Commissioner may, for
reasons to be recorded in writing, extend the time for payment or allow
payment of any amount due under this Act, other than the amount due as
per the liability self-assessed in any return, by such person in monthly
instalments not exceeding twenty four, subject to payment of interest under
section 50, and subject to such conditions and limitations as may be
prescribed:

Provided that where there is default in payment of any one installment

on its due date, the whole outstanding balance payable on such date shall
become due and payable forthwith and shall, without any further notice
being served on the person, be liable for recovery.

**81. Transfer of property to be void in certain cases- Where a person, after**
any amount has become due from him, creates a charge on or parts with the

1
Ins. by Act 23 of 2018, s.24 (w.e.f. 1-2-2019)


-----

property belonging to him or in his possession by way of sale, mortgage,
exchange, or any other mode of transfer whatsoever of any of his properties in
favour of any other person with the intention of defrauding the Government
revenue, such charge or transfer shall be void as against any claim in respect
of any tax or any other sum payable by the said person:

Provided that such charge or transfer shall not be void if it is made for

adequate consideration, in good faith and without notice of the pendency of
such proceedings under this Act or without notice of such tax or other
sum payable by the said person, or with the previous permission of the
proper officer.

**82. Tax to be first charge on property-** Notwithstanding anything to the
contrary contained in any law for the time being in force, save as
otherwise provided in the Insolvency and Bankruptcy Code, 2016, (Act No.31
of 2016) any amount payable by a taxable person or any other person on
account of tax, interest or penalty which he is liable to pay to the Government
shall be a first charge on the property of such taxable person or such person

**83.** **Provisional attachment to protect revenue in certain cases-**
(1) Where during the pendency of any proceedings under section 62 or

section 63 or section 64 or section 67 or section 73 or section 74, the Chief
Commissioner is of the opinion that for the purpose of protecting the interest
of the Government revenue, it is necessary so to do, he may, by order in
writing attach provisionally any property, including bank account, belonging
to the taxable person in such manner as may be prescribed.

(2) Every such provisional attachment shall cease to have effect after

the expiry of a period of one year from the date of the order made under subsection (1).

**84.** **Continuation and validation of certain recovery proceedings-**

Where any notice of demand in respect of any tax, penalty, interest or

any other amount payable under this Act, (hereafter in this section
referred to as “Government dues”), is served upon any taxable person or
any other person and any appeal or revision application is filed or any
other proceedings is initiated in respect of such Government dues, then:
(a) where such Government dues are enhanced in such appeal,

revision or other proceedings, the Chief Commissioner shall
serve upon the taxable person or any other person another
notice of demand in respect of the amount by which such
Government dues are enhanced and any recovery proceedings
in relation to such Government dues as are covered by the
notice of demand served upon him before the disposal of such


-----

appeal, revision or other proceedings may, without the service
of any fresh notice of demand, be continued from the stage at
which such proceedings stood immediately before such
disposal;

(b) where such Government dues are reduced in such appeal,

revision or in other proceedings:
(i) it shall not be necessary for the Chief Commissioner to

serve upon the taxable person a fresh notice of demand;

(ii) the Chief Commissioner shall give intimation of such

reduction to him and to the appropriate authority with

whom recovery proceedings is pending;

(iii) any recovery proceedings initiated on the basis of the

demand served upon him prior to the disposal of such
appeal, revision or other proceedings may be continued
in relation to the amount so reduced from the stage at
which such proceedings stood immediately before such
disposal.

**CHAPTER XVI**

**LIABILITY TO PAY IN CERTAIN CASES**

**85.** **Liability in case of transfer of business -**
(1) Where a taxable person, liable to pay tax under this Act, transfers

his business in whole or in part, by sale, gift, lease, leave and licence, hire or
in any other manner whatsoever, the taxable person and the person to whom
the business is so transferred shall, jointly and severally, be liable wholly or
to the extent of such transfer, to pay the tax, interest or any penalty due from
the taxable person upto the time of such transfer, whether such tax,
interest or penalty has been determined before such transfer, but has
remained unpaid or is determined thereafter.

(2) Where the transferee of a business referred to in sub-section (1)

carries on such business either in his own name or in some other name, he
shall be liable to pay tax on the supply of goods or services or both
effected by him with effect from the date of such transfer and shall, if he
is a registered person under this Act, apply within the prescribed time for
amendment of his certificate of registration.

**86.** **Liability of agent and principal-**

Where an agent supplies or receives any taxable goods on behalf of his


-----

principal, such agent and his principal shall, jointly and severally, be liable to
pay the tax payable on such goods under this Act.

**87.** **Liability in case of amalgamation or merger of companies-**

(1) When two or more companies are amalgamated or merged in

pursuance of an order of court or of Tribunal or otherwise and the order
is to take effect from a date earlier to the date of the order and any two or more
of such companies have supplied or received any goods or services or both to
or from each other during the period commencing on the date from
which the order takes effect till the date of the order, then such transactions
of supply and receipt shall be included in the turnover of supply or receipt of
the respective companies and they shall be liable to pay tax accordingly.

(2) Notwithstanding anything contained in the said order, for the

purposes of this Act, the said two or more companies shall be treated as
distinct companies for the period upto the date of the said order and the
registration certificates of the said companies shall be cancelled with effect
from the date of the said order.

**88. Liability in case of company in liquidation-**

(1) When any company is being wound up whether under the orders of

a court or Tribunal or otherwise, every person appointed as receiver of any
assets of a company (hereafter in this section referred to as the “liquidator”),
shall, within thirty days after his appointment, give intimation of his
appointment to the Chief Commissioner.

(2) The Chief Commissioner shall, after making such inquiry or calling

for such information as he may deem fit, notify the liquidator within three
months from the date on which he receives intimation of the appointment of
the liquidator, the amount which in the opinion of the Chief Commissioner
would be sufficient to provide for any tax, interest or penalty which is then, or
is likely thereafter to become, payable by the company.

(3) When any private company is wound up and any tax, interest or

penalty determined under this Act on the company for any period, whether
before or in the course of or after its liquidation, cannot be recovered, then
every person who was a director of such company at any time during the
period for which the tax was due shall, jointly and severally, be liable for the
payment of such tax, interest or penalty, unless he proves to the satisfaction
of the Chief Commissioner that such non-recovery cannot be attributed to
any gross neglect, misfeasance or breach of duty on his part in relation to the
affairs of the company.

**89.** **Liability of directors of private company-** (1) Notwithstanding


-----

anything contained in the Companies Act, 2013, (Act No.18 of 2013)
where any tax, interest or penalty due from a private company in respect of
any supply of goods or services or both for any period cannot be recovered,
then, every person who was a director of the private company during such
period shall, jointly and severally, be liable for the payment of such tax,
interest or penalty unless he proves that the non-recovery cannot be
attributed to any gross neglect, misfeasance or breach of duty on his part in
relation to the affairs of the company.

(2) Where a private company is converted into a public company

and the tax, interest or penalty in respect of any supply of goods or services
or both for any period during which such company was a private company
cannot be recovered before such conversion, then, nothing contained in
sub- section (1) shall apply to any person who was a director of such private
company in relation to any tax, interest or penalty in respect of such
supply of goods or services or both of such private company:

Provided that nothing contained in this sub-section shall apply to any

personal penalty imposed on such director.

**90.** **Liability of partners of firm to pay tax-**

Notwithstanding any contract to the contrary and any other law for the

time being in force, where any firm is liable to pay any tax, interest or penalty
under this Act, the firm and each of the partners of the firm shall, jointly and
severally, be liable for such payment:

Provided that where any partner retires from the firm, he or the firm,

shall intimate the date of retirement of the said partner to the Chief
Commissioner by a notice in that behalf in writing and such partner shall be
liable to pay tax, interest or penalty due upto the date of his retirement
whether determined or not, on that date:

Provided further that if no such intimation is given within one month

from the date of retirement, the liability of such partner under the first
proviso shall continue until the date on which such intimation is received by
the Chief Commissioner.

**91.** **Liability of guardians, trustees etc-**
Where the business in respect of which any tax, interest or penalty

is payable under this Act is carried on by any guardian, trustee or agent of a
minor or other incapacitated person on behalf of and for the benefit of such
minor or other incapacitated person, the tax, interest or penalty shall be
levied upon and recoverable from such guardian, trustee or agent in like
manner and to the same extent as it would be determined and recoverable
from any such minor or other incapacitated person, as if he were a major or


-----

capacitated person and as if he were conducting the business himself, and all
the provisions of this Act or the rules made thereunder shall, apply
accordingly.

**92.** **Liability of Court of Wards etc-**

Where the estate or any portion of the estate of a taxable person owning

a business in respect of which any tax, interest or penalty is payable under
this Act is under the control of the Court of Wards, the Administrator
General, the Official Trustee or any receiver or manager (including any
person, whatever be his designation, who in fact manages the business)
appointed by or under any order of a court, the tax, interest or penalty shall
be levied upon and be recoverable from such Court of Wards, Administrator
General, Official Trustee, receiver or manager in like manner and to the
same extent as it would be determined and be recoverable from the
taxable person as if he were conducting the business himself, and all the
provisions of this Act or the rules made thereunder shall apply accordingly.

**93.** **Special provisions regarding liability to pay tax, interest or penalty**
**in certain cases-** (1) Save as otherwise provided in the Insolvency and
Bankruptcy Code, 2016, (Act No.31 of 2016) where a person, liable to pay tax,
interest or penalty under this Act, dies, then:
(a) if a business carried on by the person is continued after

his death by his legal representative or any other person, such
legal representative or other person, shall be liable to pay tax,
interest or penalty due from such person under this Act; and

(b) if the business carried on by the person is discontinued,

whether before or after his death, his legal representative shall
be liable to pay, out of the estate of the deceased, to the extent
to which the estate is capable of meeting the charge, the tax,
interest or penalty due from such person under this Act,
whether such tax, interest or penalty has been determined
before his death but has remained unpaid or is determined
after his death.

(2) Save as otherwise provided in the Insolvency and Bankruptcy Code,

2016, (Act No.31 of 2016) where a taxable person, liable to pay tax, interest or
penalty under this Act, is a Hindu undivided family or an association of
persons and the property of the Hindu undivided family or the association
of persons is partitioned amongst the various members or groups of
members, then, each member or group of members shall, jointly and
severally, be liable to pay the tax, interest or penalty due from the taxable
person under this Act up to the time of the partition whether such tax,


-----

penalty or interest has been  determined  before  partition  but  has
remained unpaid or is determined after the partition.

(3) Save as otherwise provided in the Insolvency and Bankruptcy Code,

2016, (Act No.31 of 2016) where a taxable person, liable to pay tax, interest
or penalty under this Act, is a firm, and the firm is dissolved, then, every
person who was a partner shall, jointly and severally, be liable to pay the
tax, interest or penalty due from the firm under this Act up to the time of
dissolution whether such tax, interest or penalty  has  been  determined
before  the dissolution, but has remained unpaid or is determined after
dissolution.

(4) Save as otherwise provided in the Insolvency and Bankruptcy Code,

2016, (Act No.31 of 2016) where a taxable person liable to pay tax, interest or
penalty under this Act:
(a) is the guardian of a ward on whose behalf the business is

carried on by the guardian; or

(b) is a trustee who carries on the business under a trust for a

beneficiary, then, if the guardianship or trust is terminated, the
ward or the beneficiary shall be liable to pay the tax, interest or
penalty due from the taxable person up to the time of the
termination of the guardianship or trust, whether such tax,
interest or penalty has been determined before the termination
of guardianship or trust but has remained unpaid or is
determined thereafter.

**94. Liability in other cases-(1) Where a taxable person is a firm or an**
association of persons or a Hindu undivided family and such firm, association
or family has discontinued business,––

(a) the tax, interest or penalty payable under this Act by such

firm, association or family up to the date of such

discontinuance may be determined as if no such

discontinuance had taken place; and

(b) every person who, at the time of such discontinuance, was

a partner of such firm, or a member of such association or
family, shall, notwithstanding such discontinuance, jointly
and severally, be liable for the payment of tax and interest
determined and penalty imposed and payable by such firm,
association or family, whether such tax and interest has been
determined or penalty imposed prior to or after such
discontinuance and subject as aforesaid, the provisions of


-----

this Act shall, so far as may be, apply as if every such person
or partner or member were himself a taxable person.

(2) Where a change has occurred in the constitution of a firm or an

association of persons, the partners of the firm or members of association,
as it existed  before  and  as  it  exists  after  the reconstitution, shall,
without prejudice to the provisions of section 90, jointly and severally, be
liable to pay tax, interest or penalty due from such firm or association for
any period before its reconstitution.

(3) The provisions of sub-section (1) shall, so far as may be, apply

where the taxable person, being a firm or association of persons is
dissolved or where  the  taxable person,  being  a  Hindu Undivided
Family, has effected partition with respect to the business carried on
by it and accordingly references in that sub-section to discontinuance
shall be construed as reference to dissolution or, to partition.

**Explanation:- For the purposes of this Chapter,-**

(a) a “Limited Liability Partnership” formed and registered under

the provisions of the Limited Liability Partnership Act, 2008
(Act No.6 of 2008) shall also be considered as a firm;

(b) “court” means the District Court, High Court or Supreme

Court.

**CHAPTER XVII**

**ADVANCE RULING**

**95.** **Definitions - In this Chapter, unless the context otherwise requires,––**

(a) “advance ruling” means a decision provided by the Authority

or the Appellate Authority to an applicant on matters or on
questions specified in sub-section (2) of section 97 or subsection (1) of section 100, in relation to the supply of goods or
services or both being undertaken or proposed to be
undertaken by the applicant;

(b) "Appellate Authority" means the Appellate Authority for

Advance Ruling constituted under section 99.

(c) “applicant” means any person registered or desirous of

obtaining registration under this Act;

(d) “application” means an application made to the Authority

under sub-section (1) of section 97;


-----

(e) “Authority” means the Authority for Advance Ruling,

constituted under section 96;

**96. Constitution of Authority for Advance Ruling-**

(1) The Government shall, by notification, constitute an Authority to

be known as the Andhra Pradesh Authority for Advance Ruling:

Provided that the Government may, on the recommendation  of  the

Council,  notify  any Authority located in another State to act as the
Authority for the State.

(2) The Authority shall consist of
(i) one member from amongst the officers of central

tax; and

(ii) one member from amongst the officers of State

tax, to be appointed by the Central Government
and the State Government respectively.

(3) The qualifications, the method of appointment of the members

and the terms and conditions of their services shall be such as may be
prescribed.

**97.** **Application for advance ruling-**

(1) An applicant desirous of obtaining an advance ruling under this

Chapter may make an application in such form and manner and
accompanied by such fee as may be prescribed, stating the question on which
the advance ruling is sought.

(2) The question on which the advance ruling is sought under this Act,

shall be in respect of, 
(a) classification of any goods or services or both;

(b) applicability of a notification issued under the provisions of this

Act;

(c) determination of time and value of supply of goods or services or

both;

(d) admissibility of input tax credit of tax paid or deemed to have

been paid;

(e) determination of the liability to pay tax on any goods or services


-----

or both;

(f) whether applicant is required to be registered;

(g) whether any particular thing done by the applicant with

respect to any goods or services or both amounts to or results in
a supply of goods or services or both, within the meaning of that
term.

**98. Procedure on receipt of application-**
(1) On receipt of an application, the Authority shall cause a copy

thereof to be forwarded to the concerned officer and, if necessary, call upon
him to furnish the relevant records:

Provided that where any records have been called for by the Authority

in any case, such records shall, as soon as possible, be returned to the said
concerned officer.

(2) The Authority may, after examining the application and the records

called for and after hearing the applicant or his authorised representative and
the concerned officer or his authorised representative, by order, either admit
or reject the application:

Provided that the Authority shall not admit the application where the

question raised in the application is already pending or decided in any
proceedings in the case of an applicant under any of the provisions of this
Act:

Provided further that no application shall be rejected under this sub
section unless an opportunity of hearing has been given to the applicant:

Provided also that where the application is rejected, the reasons for

such rejection shall be specified in the order.

(3) A copy of every order made under sub-section (2) shall be sent to

the applicant and to the concerned officer.

(4) Where an application is admitted under sub-section (2), the

Authority shall, after examining such further material as may be placed
before it by the applicant or obtained by the Authority and after providing an
opportunity of being heard to the applicant or his authorised representative
as well as to the concerned officer or his authorised representative,
pronounce its advance ruling on the question specified in the application.

(5) Where the members of the Authority differ on any question on

which the advance ruling is sought, they shall state the point or points on
which they differ and make a reference to the Appellate Authority for hearing


-----

and decision on such question.

(6) The Authority shall pronounce its advance ruling in writing within

ninety days from the date of receipt of application.

(7) A copy of the advance ruling pronounced by the Authority duly

signed by the members and certified in such manner as may be prescribed
shall be sent to the applicant, the concerned officer and the jurisdictional
officer after such pronouncement.

**99. Constitution of Appellate Authority for Advance Ruling-**

The Government shall, by notification, constitute an Authority to be

known as the Andhra Pradesh Appellate Authority for Advance Ruling for
Goods and Services Tax for hearing appeals against the advance ruling
pronounced by the Advance Ruling Authority consisting of,(i) the Chief Commissioner of central tax as designated by the

Board; and

(ii) the Chief Commissioner of State tax:

Provided that the Government may, on the recommendations of the

Council, notify any Appellate Authority located in another State or Union
territory to act as the Appellate Authority for the State.

**100. Appeal to the Appellate Authority-**

(1) The concerned officer, the jurisdictional officer or an applicant

aggrieved by any advance ruling pronounced under sub-section (4) of section
98, may appeal to the Appellate Authority.

(2) Every appeal under this section shall be filed within a period of

thirty days from the date on which the ruling sought to be appealed against is
communicated to the concerned officer, the jurisdictional officer and the
applicant:

Provided that the Appellate Authority may, if it is satisfied that the

appellant was prevented by a sufficient cause from presenting the appeal
within the said period of thirty days, allow it to be presented within a further
period not exceeding thirty days.

(3) Every appeal under this section shall be in such form, accompanied

by such fee and verified in such manner as may be prescribed.

**101. Orders of Appellate Authority-**


-----

(1) The Appellate Authority may, after giving the parties to the appeal or

reference an opportunity of being heard, pass such order as it think fit,
confirming or modifying the ruling appealed against or referred to.

(2) The order referred to in sub-section (1) shall be passed within a

period of ninety days from the date of filing of the appeal under section 100 or
a reference under sub-section (5) of section 98.

(3) Where the members of the Appellate Authority differ on any point or

points referred to in appeal of reference, it shall be deemed that no advance
ruling can be issued in respect of the question under the appeal or reference.

(4) A copy of the advance ruling pronounced by the Appellate Authority

duly signed by the Members and certified in such manner as may be
prescribed shall be sent to the applicant, the concerned officer, the
jurisdictional officer and to the Authority after such pronouncement.

**102. Rectification of advance ruling-**

The authority or the Appellate Authority may amend any order passed by
it under  section 98 or section 101, so as to rectify any error apparent on the
fact of the record, if such error is noticed by the Authority or the Appellate
Authority on its own accord, or is brought to its notice by the concerned
officer, the jurisdictional officer or the applicant or the appellant within a
period of six months from the date of the order:

Provided that no rectification which has the effect of enhancing the tax

liability or reducing the amount of admissible input tax credit shall be made
unless the applicant or the appellant has been given an opportunity of being
heard.

**103. Applicability of advance ruling-**

(1) The advance ruling pronounced by the Authority or the Appellate

authority under this Chapter shall be binding only:
(a) on the applicant who had sought it in respect of
any matter referred to in sub-section (2) of
section 97 for advance ruling;

(b) On the concerned officer or the jurisdictional

officer in respect of the applicant.


-----

(2) The advance ruling referred to in sub-section (1) shall be binding

unless the law, facts or circumstances supporting the original advance
ruling have changed.

**104. Advance ruling to be void in certain circumstances-**

(1) Where the Authority or the Appellate Authority finds that

advance ruling pronounced by it under sub-section (4) of section 98 or under
sub-section (1) of section 101 has been obtained by the applicant or the
appellant by fraud or suppression of material facts or misrepresentation of
facts, it may, by order, declare such ruling to be void ab-initio and thereupon
all the provisions of this Act or the rules made thereunder shall apply to the
applicant or the appellant as if such advance ruling had never been made:

Provided that no order shall be passed under this sub-section unless an

opportunity of being heard has been given to the applicant or appellant.

**Explanation:- (1) The period beginning with the date of such advance ruling**
and ending with the date of order under this sub-section shall be excluded
while computing the period specified in sub-sections (2) and (10) of section 73
or sub-section (2) and (10) of section 74.

(2) A copy of the order made under sub-section (1) shall be sent to the

applicant, the concerned officer and the jurisdictional officer.

**105. Powers of Authority and Appellate Authority-**
(1) The Authority or the Appellate Authority shall, for the purpose of

exercising its powers regarding,
(a) discovery and inspection;

(b) enforcing the attendance of any person and examining him

on oath;

(c) issuing commissions and compelling production of books of

account and other records, have all the powers of a civil court
under the Code of Civil Procedure, 1908. (Act No.5 of 1908).

(2) The Authority or the Appellate Authority shall be deemed to be a

civil court for the purposes of section 195, but not for the purposes of
Chapter XXVI of the Code of Criminal Procedure, 1973, (Act No.2 of 1974)
and every proceedings before the Authority or the Appellate Authority shall
be deemed to be a judicial proceedings within the meaning of sections
193 and 228, and for the purpose of section 196 of the Indian Penal
Code, 1860. (Act No.45 of 1860).


-----

**106. Procedure of Authority and Appellate Authority-**

The Authority or the Appellate Authority shall, subject to the provisions

of this Chapter, have power to regulate its own procedure.

**CHAPTER-XVIII**

**APPEALS AND REVISION**

**107. Appeals to Appellate Authority-**

(1) Any person aggrieved by any decision or order passed under this

Act or the Central Goods and Services Tax Act, 2017 (Act No.12 of 2017)
by an adjudicating authority may appeal to such Appellate Authority as
may be prescribed within three months from the date on which the said
decision or order is communicated to such person.

(2) The Chief Commissioner may, on his own motion, or upon request

from the Commissioner of central tax, call for and examine the record of
any proceeding in which an adjudicating authority has passed any decision or
order under this Act or the Central Goods and Services Tax Act, 2017 (Act
No.12 of 2017) for the purpose of satisfying himself as to the legality or
propriety of the said decision or order and may, by order, direct any officer
subordinate to him to apply to the Appellate Authority within six months
from the date of communication of the said decision or order for the
determination of such points arising out of the said decision or order as may
be specified by the Chief Commissioner in his order.

(3) Where, in pursuance of an order under sub-section (2), the

authorized officer makes an application to the Appellate Authority, such
application shall be dealt with by the Appellate Authority as if it were an
appeal made against the decision or order of the adjudicating authority and
such authorized officer were an appellant and the provisions of this Act
relating to appeals shall apply to such application.

(4) The Appellate Authority may, if he is satisfied that the appellant

was prevented by sufficient cause from presenting the appeal within the
aforesaid period of three months or six months, as the case may be, allow it to
be presented within a further period of one month.

(5) Every appeal under this section shall be in such form and shall be

verified in such manner as may be prescribed.


-----

(6) No appeal shall be filed under sub-section (1), unless the appellant

has paid:
(a) in full, such part of the amount of tax, interest, fine, fee and

penalty arising from the impugned order, as is admitted by
him; and

(b) a sum equal to ten per cent. of the remaining amount of tax in

dispute [1][subject to a maximum of twenty-five crore rupees,] in
relation to which the appeal has been filed.

(7) Where the appellant has paid the amount under sub-section (6), the

recovery proceedings for the balance amount shall be deemed to be stayed.

(8) The Appellate Authority shall give an opportunity to the appellant of

being heard.

(9) The Appellate Authority may, if sufficient cause is shown at any

stage of hearing of an appeal, grant time to the parties or any of them and
adjourn the hearing of the appeal for reasons to be recorded in writing:

Provided that no such adjournment shall be granted more than three

times to a party during hearing of the appeal.

(10) The Appellate Authority may, at the time of hearing of an appeal,

allow an appellant to add any ground of appeal not specified in the grounds of
appeal, if it is satisfied that the omission of that ground from the grounds of
appeal was not willful or unreasonable.

(11) The Appellate Authority shall, after making such further inquiry as

may be necessary, pass such order, as it thinks just and proper, confirming,
modifying or annulling the decision or order appealed against but shall not
refer the case back to the adjudicating authority that passed the said decision
or order:

Provided that an order enhancing any fee or penalty or fine in lieu of

confiscation or confiscating goods of greater value or reducing the amount of
refund or input tax credit shall not be passed unless the appellant has been
given a reasonable opportunity of showing cause against the proposed order:

Provided further that where the Appellate Authority is of the opinion

that any tax has not been paid or short-paid or erroneously refunded, or
where input tax credit has been wrongly availed or utilised, no order requiring
the appellant to pay such tax or input tax credit shall be passed unless the
appellant is given notice to show cause against the proposed order and the

1
Subs. by Act 23 of 2018, s.25, for the words “arising from the said order” (w.e.f. 1-2-2019)


-----

order is passed within the time limit specified under section 73 or
section 74.

(12) The order of the Appellate Authority disposing of the appeal shall

be in writing and shall state the points for determination, the decision
thereon and the reasons for such decision.

(13) The Appellate Authority shall, where it is possible to do so, hear

and decide every appeal within a period of one year from the date on which it
is filed:

Provided that where the issuance of order is stayed by an order of a

court or Tribunal, the period of such stay shall be excluded in computing the
period of one year.

(14) On disposal of the appeal, the Appellate Authority shall

communicate the order passed by it to the appellant, respondent and to the
adjudicating authority.

(15) A copy of the order passed by the Appellate Authority shall also be

sent to the Chief Commissioner or the authority designated by him in this
behalf and the jurisdictional Commissioner of central tax or an authority
designated by him in this behalf.

(16) Every order passed under this section shall, subject to the

provisions of section 108 or section 113 or section 117 or section 118 be final
and binding on the parties.

**108.** **Powers of Revisional Authority-**

(1) Subject to the provisions of section 121 and any rules made

thereunder, the Revisional Authority may on his own motion, or upon
information received by him or on request from the Commissioner of
Central tax, call for and examine the record of any proceedings, and if he
considers that any decision or order passed under this Act or under the
Central Goods and Services Tax Act, 2017 (Act No.12 of 2017) by any
officer subordinate to him is erroneous in so far as it is prejudicial to the
interest of revenue and is illegal or improper or has not taken into
account certain material facts, whether available at the time of issuance
of the said order or not or in consequence of an observation by the
Comptroller and Auditor General of India, he may, if necessary, stay
the operation of such decision or order for such period as he deems fit and
after giving the person concerned an opportunity of being heard and after
making such further inquiry as may be necessary, pass such order, as he


-----

thinks just and proper, including enhancing or modifying or annulling the
said decision or order.

(2) The Revisional Authority shall not exercise any power under sub
section (I), if,
(a) the order has been subject to an appeal under section 107 or

section 112 or section 117 or section 118; or

(b) the period specified under sub-section (2) of section 107 has

not yet expired or more than three years have expired after
the passing of the decision or order sought to be revised; or

(c) the order has already been taken for revision under this

section at an earlier stage; or

(d) the order has been passed in exercise of the powers under

sub-section (1):

Provided that the Revisional Authority may pass an order

under sub-section (I) on any point which has not been raised
and decided in an appeal referred to in clause (a) of subsection (2), before the expiry of a period of one year from the
date of the order in such appeal or before the expiry of a
period of three years referred to in clause (b) of that subsection, whichever is later.

(3) Every order passed in revision under sub-section (1) shall, subject

to the provisions of section 113 or section 117 or section 118, be final and
binding on the parties.

(4) If the said decision or order involves an issue on which the

Appellate Tribunal or the High Court has given its decision in some other
proceedings and an appeal to the High Court or the Supreme Court against
such decision of the Appellate Tribunal or the High Court is pending, the
period spent between the date of the decision of the Appellate Tribunal and
the date of the decision of the High Court or the date of the decision of the
High Court and the date of the decision of the Supreme Court shall be
excluded in computing the period of limitation referred to in clause (b) of subsection (2) where proceedings for revision have been initiated by way of issue
of a notice under this section.

(5) Where the issuance of an order under sub-section (1) is stayed by

the order of a court or Appellate Tribunal, the period of such stay shall be
excluded in computing the period of limitation referred to in clause (b) of subsection (2).

(6) For the purpose of this section, the terms,
(i) “record” shall include all records relating to any proceedings
under this Act available at the time of examination by the
Revisional Authority;


-----

(ii) “decision” shall include intimation given by any officer lower
rank than the Revisional Authority

**109.** **Appellate Tribunal and Benches thereof-**

(1) Subject to the provisions of this chapter, the Goods and Services

Tax Tribunal constituted under the central goods and services tax Act, 2017
(Act No.12 of 2017) shall be the Appellate Tribunal for hearing appeals
against the orders passed by the Appellate Authority or the Revisional
Authority under this Act.

(2) The constitution and jurisdiction of the State bench and the Area

Benches located in the State shall be in accordance with the provisions of
section 109 of the Central Goods and Services Tax Act, 2017 (Act No.12 of
2017) or the rules made thereunder.

**110.** **President and members of Appellate Tribunal, their qualification,**
**appointment,** **conditions of service, etc.,** The qualifications, appointment,
salary and allowances, terms of office, resignation and removal, of the
President and Members of the State Bench and Area Benches shall be in
accordance with the provisions of section 110 of the Central Goods and
Services Tax Act, 2017. *Act No.12 of 2017).

**111.** **Procedure before Appellate Tribunal-**

(1) The Appellate Tribunal shall not, while disposing of any

proceedings before it or an appeal before it, be bound by the procedure laid
down in the Code of Civil Procedure, 1908, (Act No. 5 of 1908) but shall be
guided by the principles of natural justice and subject to the other provisions
of this Act and the rules made thereunder, the Appellate Tribunal shall
have power to regulate its own procedure.

(2) The Appellate Tribunal shall, for the purposes of discharging its

functions under this Act, have the same powers as are vested in a civil court
under the Code of Civil Procedure, 1908 (Act No.5 of 1908) while trying a suit
in respect of the following matters, namely:
(a) summoning and enforcing the attendance of any person and

examining him on oath;

(b) requiring the discovery and production of documents;

(c) receiving evidence on affidavits;

(d) subject to the provisions of sections 123 and 124 of the Indian

Evidence Act, 1872, (Act No.1 of 1872).

(e) requisitioning any public record or document or a copy of such

record or document from any office;


-----

(f) Issuing commissions for the examination of witnesses or

documents;

(g) dismissing a representation for default or deciding it ex parte;

(h) setting aside any order of dismissal of any representation for

default or any order passed by it ex parte; and

(i) any other matter which may be prescribed.

(3) Any order made by the Appellate Tribunal may be enforced by it in

the same manner as if it were a decree made by a court in a suit pending
therein, and it shall be lawful for the Appellate Tribunal to send for execution
of its orders to the court within the local limits of whose jurisdiction.

(a) in the case of an order against a company, the registered office

of the company is situated; or

(b) in the case of an order against any other person, the person

concerned voluntarily resides or carries on business or
personally works for gain.

(4) All proceedings before the Appellate Tribunal shall be deemed to be

judicial proceedings within the meaning of sections 193 and 228, and for the
purposes of section 196 of the Indian penal Code, 1860 (Act No. 45 of 1860)
and the Appellate Tribunal shall be deemed to be civil court for the purposes
of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973.
(Act No. 2 of 1974).

**112. Appeals to Appellate Tribunal-**

(1) Any person aggrieved by an order passed against him under section

107 or section 108 of this Act or the Central Goods and Services Tax Act,
2017 (Act No.12 of 2017) may appeal to the Appellate Tribunal against such
order within three months from the date on which the order sought to be
appealed against is communicated to the person preferring the appeal.

(2) The Appellate Tribunal may, in its discretion, refuse to admit any

such appeal where the tax or input tax credit involved or the difference in tax
or input tax credit involved or the amount of fine, fee or penalty determined
by such order, does not exceed fifty thousand rupees.

(3) The Chief Commissioner may, on his own motion, or upon request

from the Commissioner of central tax, call for and examine the record of any
order passed by the Appellate Authority or the Revisional Authority under
this Act or under the Central Goods And Services Tax Act,2017(Act No.12 of
2017)for the purpose of satisfying himself as to the legality or propriety of the
said order and may, by order, direct any officer subordinate to him to apply to
the Appellate Tribunal within six months from the date on which the said
order has been passed for determination of such points arising out of the


-----

said  order  as  may  be  specified  by  the Chief Commissioner in his
order.

(4) Where in pursuance of an order under sub-section (3) the

authorised officer makes an application to the Appellate Tribunal, such
application shall be dealt with by the Appellate Tribunal as if it were an
appeal made against the order under sub-section (11) of section 107 or under
sub-section (1) of section 108 and the provisions of this Act shall apply to
such application, as they apply in relation to appeals filed under sub-section
(1).

(5) On receipt of notice that an appeal has been preferred under this

section, the party against whom the appeal has been preferred may,
notwithstanding that he may not have appealed against such order or any
part thereof, file, within forty-five days of the receipt of notice, a
memorandum of cross-objections, verified in the prescribed manner, against
any part of the order appealed against and such memorandum shall be
disposed of by the Appellate Tribunal, as if it were an appeal presented within
the time specified in sub-section (1).

(6) The Appellate Tribunal may admit an appeal within three months

after the expiry of the period referred to in sub-section (1), or permit the filing
of a memorandum of cross-objections within forty-five days after the expiry of
the period referred to in sub-section (5), if it is satisfied that there was
sufficient cause for not presenting it within that period.

(7) An appeal to the Appellate Tribunal shall be in such form, verified

in such manner and shall be accompanied by such fee, as may be prescribed.

(8) No appeal shall be filed under sub-section (1), unless the appellant

has paid:
(a) in full, such part of the amount of tax, interest, fine, fee and
penalty arising from the impugned order, as is admitted by
him; and

(b) a sum equal to twenty per cent. of the remaining amount of tax
in dispute, in addition to the amount paid under sub-section
(6) of the section 107, arising from the said order, [1][subject to a
maximum of fifty crore rupees,] in relation to which the appeal
has been filed.

(9) Where the appellant has paid the amount as per sub-section (8), the

recovery proceedings for the balance amount shall be deemed to be stayed till
the disposal of the appeal.

1
Ins. by Act 23 of 2018, s.26 (w.e.f. 1-2-2019)


-----

(10) Every application made before the Appellate Tribunal:
(a) in an appeal for rectification of error or for any other purpose;

or

(b) for restoration of an appeal or an application; shall be

accompanied by such fees as may be prescribed.

**113.** **Orders of Appellate Tribunal-**

(1) The Appellate Tribunal may, after giving the parties to the appeal an

opportunity of being heard, pass such orders thereon as  it thinks fit,
confirming, modifying or annulling the decision or order appealed against or
may refer the case back to the Appellate Authority, or the Revisional Authority
or to the original adjudicating authority, with such directions as it may think
fit, for a fresh adjudication or decision after taking additional evidence, if
necessary.

(2) The Appellate Tribunal may, if sufficient cause is shown, at any

stage of hearing of an appeal, grant time to the parties or any of them and
adjourn the hearing of the appeal for reasons to be recorded in writing:

Provided that no such adjournment shall be granted more than three

times to a party during hearing of the appeal.

(3) The Appellate Tribunal may amend any order passed by it under

sub-section (1) so as to rectify any error apparent on the face of the record, if
such error is noticed by it on its own accord, or is brought to its notice by the
Chief Commissioner or the Commissioner of central tax or the other party to
the appeal within a period of three months from the date of the order:

Provided that no amendment which has the effect of enhancing an

assessment or reducing a refund or input tax credit or otherwise increasing
the liability of the other party, shall be made under this sub-section, unless
the party has been given an opportunity of being heard.

(4) The Appellate Tribunal shall, as far as possible, hear and decide

every appeal within a period of one year from the date on which it is filed.

(5) The Appellate Tribunal shall send a copy of every order passed

under this section to the Appellate Authority or the Revisional Authority, or
the original adjudicating authority, as the case may be, the appellant and the
Chief Commissioner or the jurisdictional Commissioner of central tax.

(6) Save as provided in section 117 or section 118, orders passed by

the Appellate Tribunal on an appeal shall be final and binding on the parties.

**114. Financial and administrative powers of State President-**


-----

The State President shall exercise such financial and administrative

powers over the State Bench and Area Benches of the Appellate Tribunal in a

State, as may be prescribed:

Provided that the State President shall have the authority to

delegate such of his financial and administrative powers as he may think
fit to any other Member or any officer of the State Bench or Area Benches,
subject to the condition that such Member or officer shall, while exercising
such delegated powers, continue to act under the direction, control and
supervision of the State President.

**115. Interest on refund of amount paid for admission of appeal-**

Where an amount paid by the appellant under sub- section (6) of

section 107 or under sub-section (8) of section 112 is required to be refunded
consequent to any order of the Appellate Authority or of the Appellate
Tribunal, interest at the rate specified under section 56 shall be payable in
respect of such refund from the date of payment of the amount till the date of
refund of such amount.

**116. Appearance by authorised representative-**

(1) Any person who is entitled or required to appear before an officer

appointed under this Act, or the Appellate Authority or the Appellate Tribunal
in connection with any proceedings under this Act, may, otherwise than when
required under this Act to appear personally for examination on oath or
affirmation, subject to the other provisions of this section, appear by an
authorised representative.

(2) For the purposes of this Act, the expression “authorized

representative” shall mean a person authorized by the person referred to in
sub-section (1) to appear on his behalf being:
(a) his relative or regular employee; or

(b) an advocate who is entitled to practice in any court in India,

and who has not been debarred from practicing before any
court in India; or

(c) any chartered accountant, a cost accountant or a company

secretary, who holds a certificate of practice and who has not
been debarred from practice; or

(d) a retired officer of the Commercial Tax Department of any State

Government or Union territory or of the Board who, during his
service under the Government, had worked in a post not below
the rank than that of a Group-B Gazetted officer for a period of


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not less than two years:

Provided that such officer shall not be entitled to appear before
any proceedings under this Act for a period of one year from
the date of his retirement or resignation; or

(e) any person who has been authorised to act as a goods and

services tax practitioner on behalf of the concerned registered
person.

(3) No person:
(a) who has been dismissed or removed from Government Service;

or

(b) who is convicted of an offence connected with any proceedings

under this Act, the Central Goods and Services Tax Act, 2017,
(Act No.12 of 2017)the Integrated Goods and Services Tax Act
2017 (Act No.13 of 2017)or the Union Territory Goods and
Services Tax Act, 2017 (Act No.14 of 2017)or under the existing
law or under any of the Acts passed by a State Legislature
dealing with the imposition of taxes on sale of goods or supply
of goods or services or both; or

(c) who is found guilty of misconduct by the prescribed authority;

(d) who has been adjudged as an insolvent, shall be qualified to

represent any person under sub-section(1):
(i) for all times in case of persons referred to in clauses
(a), (b) and (c); and

(ii) for the period during which the insolvency continues in
the case of a person referred to in clause (d).

(4) Any person who has been disqualified under the provisions of the

Central Goods and Services Tax Act, 2017 (Act No.12 of 2017) or the Goods
and Services Tax Act of any other State or the Union Territory Goods and
Services Tax Act, 2017 (Act No.14 of 2017)shall be deemed to be disqualified
under this Act.

**117.** **Appeal to High Court-**

(1) Any person aggrieved by any order passed by the State Bench or

Area Benches of the Appellate Tribunal may file an appeal to the High Court
and the High Court may admit such appeal, if it is satisfied that the case
involves a substantial question of law.

(2) An appeal under sub-section (1) shall be filed within a period of one

hundred and eighty days from the date on which the order appealed against


-----

is received by the aggrieved person and it shall be in such form, verified in
such manner as may be prescribed:

Provided that the High Court may entertain an appeal after the expiry

of the said period if it is satisfied that there was sufficient cause for not filing
it within such Period.

(3) Where the High Court is satisfied that a substantial question of law

is involved in any case, it shall formulate that question and the appeal shall
be heard only on the question so formulated, and the respondents shall, at
the hearing of the appeal, be allowed to argue that the case does not involve
such question:

Provided that nothing in this sub-section shall be deemed to take away

or abridge the power of the court to hear, for reasons to be recorded, the
appeal on any other substantial question of law not formulated by it, if it is
satisfied that the case involves such question.

(4) The High Court shall decide the question of law so formulated and

deliver such judgment thereon containing the grounds on which such
decision is founded and may award such cost as it deems fit.

(5) The High Court may determine any issue which:
(a) has not been determined by the State Bench or Area Benches;

or

(b) has been wrongly determined by the State Bench or Area

Benches, by reason of a decision on such question of law as
herein referred to in sub-section (3).

(6) Where an appeal has been filed before the High Court, it shall be

heard by a Bench of not less than two Judges of the High Court, and shall be
decided in accordance with the opinion of such Judges or of the majority, if
any, of such Judges.

(7) Where there is no such majority, the Judges shall state the point of

law upon which they differ and the case shall, then, be heard upon that point
only, by one or more of the other Judges of the High Court and such point
shall be decided according to the opinion of the majority of the Judges who
have heard the case including those who first heard it.

(8) Where the High Court delivers a judgment in an appeal filed before

it under this section, effect shall be given to such judgment by either side on
the basis of a certified copy of the judgment.

(9) Save as otherwise provided in this Act, the provisions of the

Code of Civil Procedure, 1908, (Act No.5 of 1908) relating to appeals to the
High Court shall, as far as may be, apply in the case of appeals under this
section.


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**118. Appeal to Supreme Court-**

(1) An appeal shall lie to the Supreme Court:
(a) from any order passed by the National Bench or Regional

Benches of the Appellate Tribunal; or

(b) from any judgment or order passed by the High Court in an

appeal made under section 117 in any case which, on its own
motion or on an application made by or on behalf of the party
aggrieved, immediately after passing of the judgment or order,
the High Court certifies to be a fit one for appeal to the
Supreme Court.

(2) The provisions of the Code of Civil Procedure, 1908, (Act No.5 of

1908) relating to appeals to the Supreme Court shall, so far as may be, apply
in the case of appeals under this section as they apply in the case of appeals
from decrees of a High Court.

(3) Where the judgment of the High Court is varied or reversed in the

appeal, effect shall be given to the order of the Supreme Court in the manner
provided in section 117 in the case of a judgment of the High Court.

**119. Sums due to be Paid Notwithstanding appeal etc.,-**

Notwithstanding that an appeal has been preferred to the High Court or

the Supreme Court, sums due to the Government as a result of an order
passed by the National or Regional Benches of the Appellate Tribunal
under sub-section (1) of section 113 or an order passed by the State Bench or
Area Benches of the Appellate Tribunal under sub-section (1) of section
113 or an order passed by the High Court under section 117, as the case
may be, shall be payable in accordance with the order so passed.

**120. Appeal not to be filed in certain cases-**

(1) The Chief Commissioner  may,  on  the recommendations of the
Council, from time to time, issue orders or instructions or directions
fixing such monetary limits, as he may deem fit, for the purposes of
regulating the filing of appeal or application by the officer of the State
tax under the provisions of this Chapter.

(2) Where, in pursuance of the orders or instructions or

directions issued under sub-section (1), the officer of the State tax
has not filed an appeal or application against any decision or order
passed under the provisions of this Act, it shall not preclude such


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officer of the State tax from filing appeal or application in any other
case involving the same or similar issues or questions of law.

(3) Notwithstanding the fact that no appeal or application

has been filed by the officer of the State tax pursuant to the orders or
instructions or directions issued under sub-section (1), no person,
being a party in appeal or application shall contend that the officer
of the State tax has acquiesced in the decision on the disputed issue by
not filing an appeal or application.

(4) The Appellate Tribunal or court hearing such appeal or

application shall have regard to the circumstances under which
appeal or application was not filed by the officer of the State tax in
pursuance of the orders or instructions or directions issued under
sub-section (1).

**121. Non Appealable decisions and orders-**

Notwithstanding anything to the contrary in any provisions of this Act,

no appeal shall lie against any decision taken or order passed by an officer of
State tax if such decision taken or order passed relates to any one or more of
the following matters, namely:–

(a) an order of the Chief Commissioner or other authority
empowered to direct transfer of proceedings from one officer
to another officer; or

(b) an order pertaining to the seizure or retention of books of
account, register and other documents; or

(c) an order sanctioning prosecution under this Act; or

(d) an order passed under section 80.

**CHAPTER  XIX**

**OFFENCES AND PENALTIES**

**122. Penalty for certain offences - (1) Where a taxable person who:-**

(i) supplies any goods or services or both without issue of any

invoice or issues an incorrect or false invoice with regard to
any such supply;


-----

(ii) issues any invoice or bill without supply of goods or services

or both in violation of the provisions of this Act or the rules
made thereunder;

(iii) collects any amount as tax but fails to pay the same to the

Government beyond a period of three months from the date on
which such payment becomes due;

(iv) collects any tax in contravention of the provisions of this Act

but fails to pay the same to the Government beyond a period
of three months from the date on which such payment
becomes due;

(v) fails to deduct the tax in accordance with the provisions of

sub-section of section 51, or deducts an amount which is less
than the amount required to be deducted under the said subsection, or where he fails to pay to the Government under
sub-section (2) thereof, the amount deducted as tax;

(vi) fails to collect tax in accordance with the provisions of sub
section (1) of section 52, or collects an amount which is less
than the amount required to be collected under the said subsection or where he fails to pay to the Government the
amount collected as tax under sub-section (3) of section 52;

(vii) takes or utilises input tax credit without actual receipt of
goods or services or both either fully or partially, in
contravention of the provisions of this Act, or the rules made
thereunder;

(viii) fraudulently obtains refund of tax under this Act;

(ix) takes or distributes input tax credit in contravention of

section 20, or the rules made thereunder;

(x) falsifies or substitutes financial records or produces fake

accounts or documents or furnishes any false information or
return with an intention to evade payment of tax due under
this Act;

(xi) is liable to be registered under this Act but fails to obtain

registration;

(xii) furnishes any false information with regard to registration
particulars, either at the time of applying for registration, or
subsequently;

(xiii) obstructs or prevents any officer in discharge of his duties

under this Act;

(xiv) transports any taxable goods without the cover of

documents as may be specified in this behalf;

(xv) suppresses his turnover leading to evasion of tax under

this Act;


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(xvi) fails to keep, maintain or retain books of account and other

documents in accordance with the provisions of this Act or

the rules made thereunder;

(xvii) fails to furnish information or documents called for by an

officer in accordance with the provisions of this Act or the

rules made thereunder or furnishes false information or

documents during any proceedings under this Act;

(xviii) supplies, transports or stores any goods which he has

reasons to believe are liable to confiscation under this Act;

(xix) issues any invoice or document by using the registration

number of another registered person;

(xx) tampers with, or destroys any material evidence or

documents;

(xxi) disposes off or tampers with any goods that have been

detained, seized, or attached under this Act,

he shall be liable to pay a penalty of ten thousand rupees

or an amount equivalent to the tax evaded or the tax not
deducted under section 51 or short deducted or deducted but
not paid to the Government or tax not collected under section
52 or short collected or collected but not paid to the
Government or input tax credit availed of or passed on or
distributed irregularly, or the refund claimed fraudulently,
whichever is higher.

(2)  Any registered person who supplies any goods or services or both

on which any tax has not been paid or short-paid or erroneously refunded, or
where the input tax credit has been wrongly availed or utilized,
(a) for any reason, other than the reason of fraud or any wilful
misstatement or suppression of facts to evade tax, shall be liable to a
penalty of ten thousand rupees or ten percent of the tax due from such
person, whichever is higher;

(b) for reason of fraud or any willful isstatement of suppression of facts
to evade tax shall be liable to a penalty equal to ten thousand rupees or
tax due from such person, whichever is higher.

(3) Any person who:
(a) aids or abets any of the offences specified in clauses (i) to (xxi)

of sub-section (1);

(b) acquires possession of, or in any way concerns himself in

transporting, removing, depositing, keeping, concealing,

supplying, or purchasing or in any other manner deals with
any goods which he knows or has reasons to believe are liable
to confiscation under this Act or the rules made thereunder;


-----

(c) receives or is in any way concerned with the supply of, or in

any other manner deals with any supply of services which he
knows or has reasons to believe are in contravention of any
provisions of this Act or the rules made thereunder;

(d) fails to appear before the officer of State tax, when issued with

a summon for appearance to give evidence or produce a
document in an inquiry;

(e) fails to issue invoice in accordance with the provisions of this

Act or the rules made thereunder or fails to account for an
invoice in his books of account, shall be liable to a penalty
which may extend to twenty five thousand rupees.

**123. Penalty for failure To furnish information return-**

If a person who is required to furnish an information return under

section 150 fails to do so within the period specified in the notice issued
under sub-section (3) thereof, the proper officer may direct, that such person
shall be liable to pay a penalty of one hundred rupees for each day of the
period during which the failure to furnish such return continues:

Provided that the penalty imposed under this section shall not exceed

five thousand rupees.

**124.** **Fine for failure to furnish statistics-**

If any person required to furnish any information or return under

section 151,
(a) without reasonable cause fails to furnish such information or

return as may be required under that section, or

(b) willfully furnishes or causes to furnish any information or

return which he knows to be false, he shall be punishable
with a fine which may extend to ten thousand rupees and in
case of a continuing offence to a further fine which may
extend to one hundred rupees for each day after the first day
during which the offence continues subject to a maximum
limit of twenty-five thousand rupees.

**125. General Penalty-**

Any person, who contravenes any of the provisions of this Act or any

rules made thereunder for which no penalty is separately provided for in this
Act, shall be liable to a penalty which may extend to twenty five thousand
rupees.

**126.** **General disciplines related penalty-**


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(1) No officer under this Act shall impose any penalty for minor

breaches of tax regulations or procedural requirements and in particular, any
omission or mistake in documentation which is easily rectifiable and made
without fraudulent intent or gross negligence.

**Explanation:- For the purpose of this sub-section,**

(a) a breach shall be considered a ‘minor breach’ if the amount of

tax involved is less than five thousand rupees;

(b) an omission or mistake in documentation shall be considered

to be easily rectifiable if the same is an error apparent on the
face of record.

(2) The penalty imposed under this Act shall depend on the facts and

circumstances of each case and shall be commensurate with the degree and
severity of the breach.

(3) No penalty shall be imposed on any person without giving him an

opportunity of being heard.

(4) The officer under this Act shall while imposing penalty in an order

for a breach of any law, regulation or procedural requirement, specify the
nature of the breach and the applicable law, regulation or procedure under
which the amount of penalty for the breach has been specified.

(5) When a person voluntarily discloses to an officer under this Act the

circumstances of a breach of the tax law, regulation or procedural
requirement prior to the discovery of the breach by the officer under this Act,
the proper officer may consider this fact as a mitigating factor when
quantifying a penalty for that person.

(6) The provisions of this section shall not apply in such cases where

the penalty specified under this Act is either a fixed sum or expressed as a
fixed percentage.

**127. Power to impose penalty in certain cases-**

Where the proper officer is of the view that a person is liable to a

penalty and the same is not covered under any proceedings under section 62
or section 63 or section 64 or section 73 or section 74 or section 129 or
section 130, he may issue an order levying such penalty after giving a
reasonable opportunity of being heard to such person.

**128. Power to waive penalty or fee or both-**

The Government may, by notification, waive in part or full, any penalty

referred to in section 122 or section 123 or section 125 or any late fee referred
to in section 47 for such class of taxpayers and under such mitigating
circumstances as may be specified therein on the recommendations of the


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Council.

**129. Detention, Seizure and release of goods and conveyances in**
**transit-**

(1) Notwithstanding anything contained in this Act, where any person

transports any goods or stores any goods while they are in transit in
contravention of the provisions of this Act or the rules made
thereunder, all such goods and conveyance used as a means of transport for
carrying the said goods and documents relating to such goods and
conveyances shall be liable to detention or seizure and after detention or
seizure, shall be released:
(a) on payment of the applicable tax and penalty equal to one

hundred per cent of the tax payable on such goods and, in case
of exempted goods, on payment of an amount equal to two per
cent of the value of goods or twenty five thousand rupees,
whichever is less, where the owner of the goods comes forward
for payment of such tax and penalty;

(b) on payment of the applicable tax and penalty equal to the fifty

per cent of the value of the goods reduced by the tax amount
paid thereon and, in case of exempted goods, on payment of an
amount equal to five per cent of the value of goods or twenty
five thousand rupees, whichever is less, where the owner of the
goods does not come forward for payment of such tax and
penalty;

(c) upon furnishing a security equivalent to the amount

payable under clause (a) or clause (b) in such form and manner
as may be prescribed:

Provided that no such goods or conveyance shall be detained
or seized without serving an order of detention or seizure
on the person transporting the goods.

(2) The provisions of sub-section (6) of section 67 shall, mutatis

mutandis, apply for detention and seizure of goods and conveyances.

(3) The proper officer detaining or seizing goods or conveyances shall

issue a notice specifying the tax and penalty payable and thereafter, pass an
order for payment of tax and penalty under clause (a) or clause (b) or clause
(c).

(4) No tax, interest or penalty shall be determined under sub-section

(3), without giving the person concerned an opportunity of being heard.


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(5) On payment of amount referred in sub-section (1), all proceedings

in respect of the notice specified in sub- section (3), shall be deemed to be
concluded.

(6) Where the person transporting any goods or the owner of the goods

fails to pay the amount of tax and penalty as provided in sub-section (1)
within [1][fourteen days] of such detention or seizure, further proceedings shall
be initiated in accordance with the provisions of section 130:

Provided that where the detained or seized goods are perishable or

hazardous in nature or are likely to depreciate in value with passage of time,
the said period of seven days may be reduced by the proper officer.

**130. Confiscation of goods or conveyances and levy of penalty-**

(1) Notwithstanding anything contained in this Act, if any person
(i) supplies or receives any goods in contravention of any of the
provisions of this Act or the rules made thereunder with
intent to evade payment of tax; or

(ii) does not account for any goods on which he is liable to pay
tax under this Act; or

(iii) supplies any goods liable to tax under this Act without

having applied for registration; or

(iv) contravenes any of the provisions of this Act or the rules

made thereunder with intent to evade payment of tax; or

(v) uses any conveyance as a means of transport for carriage of
goods in contravention of the provisions of this Act or the
rules made thereunder unless the owner of the conveyance
proves that it was so used without the knowledge or
connivance of the owner himself, his agent, if any, and the
person in charge of the conveyance, then, all such goods or
conveyances shall be liable to confiscation and the person
shall be liable to penalty under section 122.

(2) Whenever confiscation of any goods or conveyance is authorised by

this Act, the officer adjudging it shall give to the owner of the goods an option
to pay in lieu of confiscation, such fine as the said officer thinks fit:

Provided that such fine leviable shall not exceed the market value of the

goods confiscated, less the tax chargeable thereon:

1
Subs. by Act 23 of 2018, s.27, for the words “seven days” (w.e.f. 1-2-2019)


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Provided further that the aggregate of such fine and penalty leviable

shall not be less than the amount of penalty leviable under sub-section (1) of
section 129:

Provided also that where any such conveyance is used for the carriage

of the goods or passengers for hire, the owner of the conveyance shall be
given an option to pay in lieu of the confiscation of the conveyance a fine
equal to the tax payable on the goods being transported thereon.

(3) Where any fine in lieu of confiscation of goods or conveyance is

imposed under sub-section (2), the owner of such goods or conveyance or the
person referred to in sub-section (1), shall, in addition, be liable to any tax,
penalty and charges payable in respect of such goods or conveyance.

(4) No order for confiscation of goods or conveyance or for imposition

of penalty shall be issued without giving the person an opportunity of being
heard.

(5) Where any goods or conveyance are confiscated under this Act, the

title of such goods or conveyance shall thereupon vest in the Government.

(6) The proper officer adjudging confiscation shall take and hold

possession of the things confiscated and every officer of Police, on the
requisition of such proper officer, shall assist him in taking and holding such
possession.

(7) The proper officer may, after satisfying himself that the confiscated

goods or conveyance are not required in any other proceedings under this Act
and after giving reasonable time not exceeding three months to pay fine in
lieu of confiscation, dispose of such goods or conveyance and deposit the sale
proceeds thereof with the Government.

**131.** **Confiscation or penalty not to interfere with other punishments-**
Without prejudice to the provisions contained in the  Code  of Criminal
Procedure, 1973,(Act No.2 of 1974)no confiscation made or penalty imposed
under the provisions of this Act or the rules made thereunder shall prevent
the infliction of any other punishment to which the person affected thereby is
liable under the provisions of this Act or under any other law for the time
being in force.

**132.** **Punishment for certain offences-** (1) Whoever commits any of the
following offences, namely:
(a) supplies any goods or services or both without issue of any

invoice, in violation of the provisions of this Act, or the rules
made there under with the intention to evade tax;

(b) issues any invoice or bill without supply of goods or services

or both in violation of the provisions of this Act, or the rules
made thereunder leading to wrongful availment or utilisation
of input tax credit or refund of tax;


-----

(c) avails input tax credit using such invoice or bill referred to in

clause (b);

(d) collects any amount as tax but fails to pay the same to the

Government beyond a period of three months from the date on
which such payment becomes due;

(e) evades tax, fraudulently avails input tax credit or fraudulently

obtains refund and where such offence is not covered under
clauses (a) to (d);

(f) falsifies or substitutes financial records or produces fake

accounts or documents or furnishes any false information
with an intention to evade payment of tax due under this Act;

(g) obstructs or prevents any officer in the discharge of his duties

under this Act;

(h) acquires possession of, or in any way concerns himself in

transporting, removing, depositing, keeping, concealing,

supplying, or purchasing or in any other manner deals with,
any goods which he knows or has reasons to believe are liable
to confiscation under this Act or the rules made thereunder;

(i) receives or is in any way concerned with the supply of, or in

any other manner deals with any supply of services which he
knows or has reasons to believe are in contravention of any
provisions of this Act or the rules made thereunder;

(j) tampers with or destroys any material evidence or documents;

(k) fails to supply any information which he is required to supply

under this Act or the rules made thereunder or (unless with a
reasonable belief, the burden of proving which shall be upon
him, that the information supplied by him is true) supplies
false information; or

(l) attempts to commit, or abets the commission of any of the

offences mentioned in clauses (a) to (k) of this section, shall be
punishable
(i) in cases where the amount of tax evaded or the amount
of input tax credit wrongly availed or utilised or the
amount of refund wrongly taken exceeds five hundred
lakh rupees, with imprisonment for a term which may
extend to five years and with fine;


-----

(ii) in cases where the amount of tax evaded or the amount
of input tax credit wrongly availed or utilised or the
amount of refund wrongly taken exceeds two hundred
lakh rupees but does not exceed five hundred lakh
rupees, with imprisonment for a term which may extend
to three years and with fine;

(iii) in the case of any other offence where the amount of tax
evaded or the amount of input tax credit wrongly
availed or utilised or the amount of refund wrongly
taken exceeds one hundred lakh rupees but does not
exceed two hundred lakh rupees, with imprisonment for
a term which may extend to one year and with fine;

(iv) in cases where he commits or abets the commission of
an offence specified in clause (f) or clause (g) or clause
(j), he shall be punishable with imprisonment for a term
which may extend to six months or with fine or with
both.

(2) Where any person convicted of an offence under this section is

again convicted of an offence under this section, then, he shall be punishable
for the second and for every subsequent offence with imprisonment for a term
which may extend to five years and with fine:

(3) The imprisonment referred to in clauses (i), (ii) and (iii) of sub
section (1) and sub-section (2) shall, in the absence of special and adequate
reasons to the contrary to be recorded in the judgment of the Court, be for a
term not less than six months.

(4) Notwithstanding anything contained in the Code of Criminal

Procedure, 1973, (Act No.2 of 1974) all offences under this Act, except the
offences referred to in sub-section (5) shall be non-cognizable and bailable.

(5) The offences specified in clause (a) or clause (b) or clause (c) or

clause (d) of sub-section (1) and punishable under clause (i) of that subsection shall be cognizable and non-bailable.

(6) A person shall not be prosecuted for any offence under this section

except with the previous sanction of the Chief Commissioner.

**Explanation:– For the purposes of this section, the term “tax” shall include**
the amount of tax evaded or the amount of input tax credit wrongly availed or
utilised or refund wrongly taken under the provisions of this Act, the Central
Goods and Services Tax Act, 2017 (Act No.12 of 2017.) the Integrated Goods
and Services Tax Act, 2017 (Act No.13 of 2017)and cess levied under the


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Goods and Services Tax (Compensation to States) Act, 2017 (Act No.15 of
2017).

**133.** **Liability of officers and certain other persons- (1)** Where any

person engaged in connection with the collection  of statistics under section
151 or compilation or computerisation thereof or if any officer of State
tax having access to information specified under sub-section (1) of section
150, or any person engaged in connection with provisions of service on
the common portal or the agent of common portal, willfully discloses any
information or the contents of any return furnished under this Act or rules
made thereunder otherwise than in execution of his duties under the said
sections or for the purposes of the prosecution of an offence under this Act or
under any other Act for the time being in force, he shall be punishable with
imprisonment for a term which may extend to six months or with fine which
may extend to twenty five thousand rupees, or with both.

(2) Any person –

(a) who is a Government servant shall not be prosecuted for any
offence under this section except with the previous sanction of
the Government;

(b) who is not a Government servant shall not be prosecuted for
any offence under this section except with the previous
sanction of the Chief Commissioner.

**134. Cognizance of offences-**

No court shall take cognizance of any offence punishable under this

Act or the rules made thereunder except with the previous sanction of the
Chief Commissioner, and no court inferior to that of a Magistrate of the
First Class, shall try any such offence.

**135. Presumption of culpable mental state-**

In any prosecution for an offence under this Act which requires a

culpable mental state on the part of the accused, the court shall presume the
existence of such mental state but it shall be a defence for the accused to
prove the fact that he had no such mental state with respect to the act
charged as an offence in that prosecution.

**Explanation:- For the purposes of this section,-**

(i) the expression “culpable mental state” includes intention,

motive, knowledge of a fact, and belief in, or reason to believe, a
fact;

(ii) a fact is said to be proved only when the court believes it to exist

beyond reasonable doubt and not merely when its existence is
established by a preponderance of probability.


-----

**136.** **Relevancy of statements under certain circumstances-**

A statement made and signed by a person on appearance in response to

any summons issued under section 70 during the course of any inquiry
or proceedings under this Act shall be relevant, for the purpose of proving, in
any prosecution for an offence under this Act, the truth of the facts
which it contains:
(a) when the person who made the statement is dead or cannot

be found, or is incapable of giving evidence, or is kept out of
the way by the adverse party, or whose presence cannot be
obtained without an amount of delay or expense which,
under the circumstances of the case, the court considers
unreasonable; or

(b) when the person who made the statement is examined as a

witness in the case before the court and the court is of the
opinion that, having regard to the circumstances of the case,
the statement should be admitted in evidence in the interest
of justice.

**137. Offences by Companies-**

(1) Where an offence committed by a person under this Act is a

company, every person who, at the time the offence was committed was in
charge of, and was responsible to, the company for the conduct of business of
the company, as well as the company, shall be deemed to be guilty of the
offence and shall be liable to be proceeded against and punished
accordingly.

(2) Notwithstanding anything contained in sub-section (1), where an

offence under this Act has been committed by a company and it is proved
that the offence has been committed with the consent or connivance of, or is
attributable to any negligence on the part of, any director, manager, secretary
or other officer of the company, such director, manager, secretary or other
officer shall also be deemed to be guilty of that offence and shall be liable to
be proceeded against and punished accordingly.

(3) Where an offence under this Act has been committed by a taxable

person being a partnership firm or a Limited Liability Partnership or a Hindu
undivided family or a trust, the partner or karta or managing trustee shall be
deemed to be guilty of that offence and shall be liable to be proceeded against
and punished accordingly and the provisions of sub-section (2) shall _mutatis_
_mutandis apply to such persons._

(4) Nothing contained in this section shall render any such person

liable to any punishment provided in this Act, if he proves that the offence
was committed without his knowledge or that he had exercised all due


-----

diligence to prevent the commission of such offence.

**Explanation:- For the purposes of this section,-**

(i) “company” means a body corporate and includes a firm or

other association of individuals; and

(ii) “director”, in relation to a firm, means a partner in the firm.

**138.** **Compounding of offences-**

(1) Any offence under this Act may, either before or after the institution

of prosecution, be compounded by the Chief Commissioner on payment, by
the person accused of the offence, to the Central Government or the State
Government, as the case may be, of such compounding amount in such
manner as may be prescribed (Act No.2 of 1974):

Provided that nothing contained in this section shall apply to,
(a) a person who has been allowed to compound once in respect

of any of the offences specified in clauses (a) to (f) of subsection (1) of section 132 and the offences specified in clause
(l) which are relatable to offences specified in clauses (a) to (f)
of the said sub-section;

(b) a person who has been allowed to compound once in respect

of any offence, other than those in clause (a), under this
Act or under the provisions of any State Goods and Services
Tax Act or the Central Goods and Services Tax Act, 2017 (Act
No.12 of 2017) or the Union Territory Goods and Services Tax
Act, 2017 (Act No.14 of 2017)or the Integrated Goods and
Services Tax Act, 2017 (Act No.13 of 2017) in respect of
supplies of value exceeding one crore rupees;

(c) a person who has been accused of committing an offence

under this Act which is also an offence under any other law
for the time being in force;

(d) a person who has been convicted for an offence under this Act

by a court;

(e) a person who has been accused of committing an offence

specified in clause (g) or clause (j) or clause (k) of sub-section
(1) of section 132; and

(f) any other class of persons or offences as may be prescribed:

Provided further that any compounding allowed under the
provisions of this section shall not affect the proceedings, if


-----

any, instituted under any other law:

Provided also that compounding shall be allowed only after
making payment of tax, interest and penalty involved in such
offences.

(2) The amount for compounding of offences under this section shall be

such as may be prescribed, subject to the minimum amount not being less
than ten thousand rupees or fifty per cent of the tax involved, whichever is
higher, and the maximum amount not being less than thirty thousand
rupees or one hundred and fifty per cent of the tax, whichever is higher.

(3) On payment of such compounding amount as may be

determined by the Chief Commissioner, no further proceedings shall be
initiated under this Act against the accused person in respect of the same
offence and any criminal proceedings, if already initiated in respect of the said
offence, shall stand abated.

**CHAPTER XX**

**TRANSITIONAL PROVISIONS**

**139. Migration of existing taxpayers-**

(1) On and from the appointed day, every person registered under any

of the existing laws and having a valid Permanent Account Number shall be
issued a certificate of registration on provisional basis, subject to such
conditions and in such form and manner as may be prescribed and, unless
replaced by a final certificate of registration under sub-section (2), shall be
liable to be cancelled if the conditions so prescribed are not complied with.

(2) The final certificate of registration shall be granted in such form

and manner and subject to such conditions as may be prescribed.

(3) The certificate of registration issued to a person under sub-section

(1) shall be deemed to have not been issued if the said registration is
cancelled in pursuance of an application filed by such person that he was not
liable to registration under section 22 or section 24.

**140. Transitional arrangements for input tax credit-** (1) A registered
person, other than a person opting to pay tax under section 10, shall be
entitled to take, in his electronic credit ledger, credit of the amount of Value
Added Tax carried forward in the return relating to the period ending with the
day immediately preceding the appointed day, furnished by him under the
existing law, the said day, in such manner as may be prescribed:

Provided that the registered person shall not be allowed to take credit in

the following circumstances, namely: –


-----

(i) where the said amount of credit is not admissible as input tax
credit under this Act; or

(ii) where he has not furnished all the returns required under the
existing law for the period of six months immediately preceding
the appointed date;

Provided further that so much of the said credit as is attributable

to any claim related to section 3, sub-section (3) of section 5, section 6,
section 6A or sub-section (8) or section 8 of the Central Sales Tax Act,
1956 which is not substantiated in the manner, and within the period,
prescribed in rule 12 of the Central Sales Tax (Registration and
Turnover) Rules, 1957 shall not be eligible to be credited to the
electronic credit ledger:

Provided also that an amount equivalent to the credit specified in

the second proviso shall be refunded under the existing law when the
said claims are substantiated in the manner prescribed in rule 12 of the
Central Sales Tax (Registration and Turnover) Rules, 1957.

(2) A registered person, other than a person opting to pay tax under

section 10, shall be entitled to take, in his electronic credit ledger, credit
of the unavailed input tax credit in respect of capital goods, not carried
forward in a return, furnished under the existing law by him, for the
period ending with the day immediately preceding the appointed day in
such manner as may be prescribed:

Provided that the registered person shall not be allowed to take

credit unless the said credit was admissible as input tax credit under the
existing law and is also admissible as input tax credit under this Act.

**Explanation:-** For the purposes of this section, the expression “unavailed

input tax credit” means the amount that remains after subtracting the
amount of input tax credit already availed in respect of capital goods by the
taxable person under the existing law from the aggregate amount of input tax
credit to which the said person was entitled in respect of the said capital
goods under the existing law.

(3) A registered person, who was not liable to be registered under the

existing law or who was engaged in the sale of exempted goods, or tax free
goods, by whatever name called or goods which have suffered tax at the first
point of their sale in the State and the subsequent sales of which are not
subject to tax in the State under the existing law but which are liable to tax
under this Act or where the person was entitled to the credit of input tax at
the time of sale of goods, if any, shall be entitled to take, in his electronic
credit ledger, credit of the value added tax in respect of inputs held in stock
and inputs contained in semi-finished or finished goods held in stock on the
appointed day subject to the following conditions namely:

-----

(i) such inputs or goods are used or intended to be used for
making taxable supplies under this Act;

(ii) the said registered person is eligible for input tax credit on
such inputs under this Act;

(iii) the said registered person is in possession of invoice or other

prescribed documents evidencing payment of tax under the
existing law in respect of such inputs; and

(iv) such invoices or other prescribed documents were issued not

earlier than twelve months immediately preceding the

appointed day:

Provided that where a registered person, other than a

manufacturer or a supplier of services, is not in possession of an
invoice or any other documents evidencing payment of tax in respect
of inputs, then, such registered person shall, subject to such
conditions, limitations and safeguards as may be prescribed, including
that the said taxable person shall pass on the benefit of such credit by
way of reduced prices to the recipient, be allowed to take credit at
such rate and in such manner as may be prescribed.

(4) A registered person, who was engaged in the sale of taxable

goods as well as exempted goods [or tax free goods] under the existing
law but which are liable to tax under this Act, shall be entitled to take,
in his electronic credit ledger,
(a) the amount of credit of the value added tax carried forward in a

return furnished under the existing law by him in accordance
with the provisions of sub-section (1); and

(b) the amount of credit of the value added tax in respect of inputs

held in stock and inputs contained in semi-finished or finished
goods held in stock on the appointed day, relating to such
exempted goods or tax free goods by whatever name called in
accordance with the provisions of sub-section (3).

(5) A registered person shall be entitled to take, in his electronic credit

ledger, credit of value added tax in respect of inputs received on or after the
appointed day but the tax in respect of which has been paid by the supplier
under the existing law, subject to the condition that the invoice or any other
taxpaying document of the same was recorded in the books of account of
such person within a period of thirty days from the appointed day:

Provided that the period of thirty days may, on sufficient cause being

shown, be extended by the Chief Commissioner for a further period not


-----

exceeding thirty days:

Provided further that the said registered person shall furnish a

statement, in such manner as may be prescribed, in respect of credit that has
been taken under this sub-section.

(6) A registered person, who was either paying tax at a fixed rate

or paying a fixed amount in lieu of the tax payable under the existing law
shall be entitled to take, in his electronic credit ledger, credit of value added
tax in respect of inputs held in stock and inputs contained in semi-finished or
finished goods held in stock on the appointed day subject to the following
conditions, namely:––

(i) such inputs or goods are used or intended to be used or
making taxable supplies under this Act;

(ii) the said registered person is not paying tax under section 10;

(iii) the said registered person is eligible for input tax credit on

such inputs under this Act;

(iv) the said registered person is in possession of invoice or other

prescribed documents evidencing payment of tax under the
existing law in respect of inputs; and

(v) such invoices or other prescribed documents were issued not
earlier than twelve months immediately preceding the

appointed day.

(7) The amount of credit under sub-sections (3), (4) and (6) shall be

calculated in such manner as may be prescribed.

**141.** **Transitional provisions relating to job work-**

(1) where any inputs received at a place of business had been

dispatched as such or dispatched after being partially processed to a job
worker for further processing, testing, repair, reconditioning or any other
purpose in accordance with the provisions of existing law prior to the
appointed day and such inputs are returned to the said place on or after the
appointed day, no tax shall be payable if such inputs, after completion of the
job work or otherwise, are returned to the aid place within six months from
the appointed day:

Provided that the period of six months may, on sufficient cause being

shown, be extended by the Chief Commissioner for a further period not
exceeding two months:

Provided further that if such inputs are not returned within the

period specified in this sub-section the input tax credit shall be liable to be


-----

recovered in accordance with the provisions of clause (a) of sub-section (8) of
section 142.

(2) Where any semi-finished goods had been dispatched from any place

of business to any other premises for carrying out certain manufacturing
process in accordance with the provisions of existing law prior to the
appointed day and such goods (hereafter in this sub-section referred to as
“the said goods”) are returned to the said place on or after the appointed day,
no tax shall be payable if the said goods, after undergoing manufacturing
process or otherwise, are returned to the said place within six months from
the appointed day:

Provided that the period of six months may, on sufficient cause being

shown, be extended by the Commissioner for a further period not exceeding
two months:

Provided further that if the said goods are not returned within a period

specified in this sub-section, the input tax credit shall be liable to be
recovered in accordance with the provisions of clause (a) of sub-section (8) of
section 142:

(2) Where any goods had been despatched from the place of business

without payment of tax for carrying out tests or any other process, to any
other premises, whether registered or not, in accordance with the provisions
of existing law prior to the appointed day and such goods are returned to the
said place of business on or after the appointed day, no tax shall be payable if
the said goods, after undergoing tests or any other process, are returned to
such place within six months from the appointed day:

Provided that the period of six months may, on sufficient cause being

shown, be extended by the Chief Commissioner for a further period not
exceeding two months:

Provided further that if the said goods are not returned within the

period specified in this sub-section, the input tax credit shall be liable to be
recovered in accordance with the provisions of clause (a) of sub-section (8) of
section 142:

Provided also that the person despatching the goods may, in

accordance with the provisions of the existing law, transfer the said goods
from the said other premises on payment of tax in India or without payment
of tax for exports within the period specified in this sub-section.

(2) Where any goods had been despatched from the place of business

without payment of tax for carrying out tests or any other process, to any
other premises, whether registered or not, in accordance with the provisions
of existing law prior to the appointed day and such goods are returned to the


-----

said place of business on or after the appointed day, no tax shall be payable if
the said goods, after undergoing tests or any other process, are returned to
such place within six months from the appointed day:

Provided that the period of six months may, on sufficient cause being

shown, be extended by the Chief Commissioner for a further period not
exceeding two months:

Provided further that if the said goods are not returned within the

period specified in this sub-section, the input tax credit shall be liable to be
recovered in accordance with the provisions of clause (a) of sub-section (8) of
section 142:

Provided also that the person despatching the goods may, in

accordance with the provisions of the existing law, transfer the said goods
from the said other premises on payment of tax in India or without payment
of tax for exports within the period specified in this sub-section.

(4) The tax under sub-sections (1), (2) and (3) shall not be payable only

if the person despatching the goods and the job worker declare the details of
the inputs or goods held in stock by the job worker on behalf of the said
person on the appointed day in such form and manner and within such time
as may be prescribed.

**142.** **Miscellaneous transitional provisions- (1) Where any goods on which**
tax, if any, had been paid under the existing law at the time of sale thereof,
not being earlier than six months prior to the appointed day, are returned to
any place of business on or after the appointed day, the registered person
shall be eligible for refund of the tax paid under the existing law where such
goods are returned by a person, other than a registered person, to the
said place of business within a period of six months from the appointed day
and such goods are identifiable to the satisfaction of the proper officer:

Provided that if the said goods are returned by a registered person, the

return of such goods shall be deemed to be a supply.

(2) (a) Where, in pursuance of a contract entered into prior to the
appointed day, the price of any goods is revised upwards on or after the
appointed day, the registered person who had sold such goods shall issue to
the recipient a supplementary invoice or debit note, containing such
particulars as may be prescribed, within thirty days of such price revision
and for the purposes of this Act, such supplementary invoice or debit note
shall be deemed to have been issued in respect of an outward supply
made under this Act.

(b) Where, in pursuance of a contract entered into prior to the

appointed day, the price of any goods is revised downwards on or after the
appointed day, the registered person who had sold such goods may issue to
the recipient a credit note, containing such particulars as may be prescribed,


-----

within thirty days of such price revision and for the purposes of this Act such
credit note shall be deemed to have been issued in respect of an outward
supply made under this Act:

Provided that the registered person shall be allowed to reduce his tax

liability on account of issue of the credit note only if the recipient of the credit
note has reduced his input tax credit corresponding to such reduction of tax
liability.

(3) Every claim for refund filed by any person before, on or after the

appointed day, for refund of any amount of input tax credit, tax, interest or
any other amount paid under the existing law, shall be disposed of in
accordance with the provisions of existing law and any amount eventually
accruing to him shall be refunded to him in cash in accordance with the
provisions of the said law:

Provided that where any claim for refund of the amount of input tax

credit is fully or partially rejected, the amount so rejected shall lapse:

Provided further that no refund shall be allowed of any amount of input

tax credit where the balance of the said amount as on the appointed day has
been carried forward under this Act.

(4) Every claim for refund filed after the appointed day for refund of

any tax paid under the existing law in respect of the goods exported before or
after the appointed day shall be disposed of in accordance with the provisions
of the existing law:

Provided that where any claim for refund of input tax credit is fully or

partially rejected, the amount so rejected shall lapse:

Provided further that no refund shall be allowed of any amount of input

tax credit where the balance of the said amount as on the appointed day has
been carried forward under this Act.

(5) Not withstanding anything to the contrary contained in this Act,

any amount of input tax credit reversed prior to the appointed day shall not
be admissible as input tax credit under this Act.

(6) (a) Every proceeding of appeal, revision, review or reference relating

to a claim for input tax credit initiated whether before, on or after the
appointed day, under the existing law shall be disposed of in accordance with
the provisions of the existing law, and any amount of credit found to be
admissible to the claimant shall be refunded to him in cash in accordance
with the provisions of the existing law, and the amount rejected, if any, shall
not be admissible as input tax credit under this Act:

Provided that no refund claim shall be allowed of any amount of _input_

_tax credit where the balance of the said amount as on the appointed day has_


-----

been carried forward under this Act.

(b) Every proceeding of appeal, revision, review or reference relating to

recovery of input tax credit initiated whether before, on or after the appointed
day, under the existing law shall be disposed of in accordance with the
provisions of the existing law, and if any amount of credit becomes
recoverable as a result of such appeal, revision, review or reference, the same
shall, unless recovered under the existing law, be recovered as an arrear of
tax under this Act and the amount so recovered shall not be admissible as
input tax credit under this Act.

(7) (a) Every proceeding of appeal, revision, review or reference

relating to any output tax liability initiated whether before, on or after the
appointed day under the existing law, shall be disposed of in accordance
with the provisions of the existing law, and if any amount becomes
recoverable as a result of such appeal, revision, review or reference, the same
shall, unless recovered under the existing law, be recovered as an arrear of
tax under this Act and amount so recovered shall not be admissible as input
tax credit under this Act.

(b) Every proceeding of appeal, revision, review or reference relating

to any output tax liability initiated whether before, on or after the appointed
day under the existing law, shall be disposed of in accordance with the
provisions of the existing law, and any amount found to be admissible to the
claimant shall be refunded to him in cash in accordance with the provisions
of the existing law and the amount rejected, if any, shall not be admissible as
input tax credit under this Act.

(8) (a) Where in pursuance of an assessment or adjudication

proceedings instituted, whether before, on or after the appointed day, under
the existing law, any amount of tax, interest, fine or penalty becomes
recoverable from the person, the same shall, unless recovered under the
existing law, be recovered as an arrear of tax under this Act and the amount
so recovered shall not be admissible as input tax credit under this Act.

(b) Where in pursuance of an assessment or adjudication proceedings

instituted, whether before, on or after the appointed day under the existing
law, any amount of tax, interest, fine or penalty becomes refundable to the
taxable person, the same shall be refunded to him in cash under the said
law, and the amount rejected, if any, shall not be admissible as input tax
credit under this Act.

(9) (a) Where any return, furnished under the existing law, is revised

after the appointed day and if, pursuant to such revision, any amount is
found to be recoverable or any amount of input tax credit is found to be


-----

inadmissible, the same shall, unless recovered under the existing law, be
recovered as an arrear of tax under this Act and the amount so recovered
shall not be admissible as input tax credit under this Act.

(b) Where any return, furnished under the existing law, is revised after

the appointed day but within the time limit specified for such revision under
the existing law and if, pursuant to such revision, any amount is found to be
refundable or input tax credit is found to be admissible to any taxable person,
the same shall be refunded to him in cash, under the existing law, and the
amount rejected, if any, shall not be admissible as input tax credit under this
Act.

(10) Save as otherwise provided in this Chapter, the goods or services

or both supplied on or after the appointed day in pursuance of a contract
entered into prior to the appointed day shall be liable to tax under the
provisions of this Act.

(11) (a) Notwithstanding anything contained in section 12, no tax

shall be payable on goods under this Act to the extent the tax was leviable on
the said goods under the Andhra Pradesh Value Added Tax Act, 2005 (Act
No.5 of 2005)

(b) Notwithstanding anything contained in section 13, no tax shall be

payable on services under this Act to the extent the tax was leviable on the
said services under Chapter V of the Finance Act, 1994. (Act No.32 of 1994).

(c) Where tax was paid on any supply, both under the Andhra Pradesh

Value Added Tax Act, 2005 (Act No.5 of 2005) and under Chapter V of the
Finance Act, 1994, (Act No. 32 of 1994)tax shall be leviable under this Act
and the taxable person shall be entitled to take credit of value added tax or
service tax paid under the existing law to the extent of supplies made after
the appointed day and such credit shall be calculated in such manner as may
be prescribed.

(12) Where any goods sent on approval basis, not earlier than six

months before the appointed day, are rejected or not approved by the buyer
and returned to the seller on or after the appointed day, no tax shall be
payable thereon if such goods are returned within six months from the
appointed day:

Provided that the said period of six months may, on sufficient cause

being shown, be extended by the Chief Commissioner for a further period not
exceeding two months:

Provided further that the tax shall be payable by the person returning

the goods if such goods are liable to tax under this Act, and are returned after
the period specified in this sub-section:

Provided also that tax shall be payable by the person who has sent the


-----

goods on approval basis if such goods are liable to tax under this Act, and
are not returned within the period specified in this sub-section.

(13) Where a supplier has made any sale of goods in respect of which

tax was required to be deducted at source under the Andhra Pradesh
Value Added Tax Act,2005- (Act No.5 of 2005) and has also issued an invoice
for the same before the appointed day, no deduction of tax at source under
section 51 shall be made by the deductor under the said section where
payment to the said supplier is made on or after the appointed day.

(14) Where any goods or capital goods belonging to the principal are

lying at the premises of the agent on the appointed day, the agent shall be
entitled to take credit of the tax paid on such goods or capital goods subject
to fulfillment of the following conditions :

(i) the agent is a registered taxable person under this Act;

(ii) both the principal and the agent declare the details of stock of
goods or capital goods lying with with such agent on the day
immediately preceding the appointed day in such form an
manner and within such time as may be prescribed in this
behalf;

(iii) the invoices for such goods or capital goods had been issued not

earlier than twelve months immediately preceding the appointed
day; and

(iv) the principal has either reversed or not availed of the input tax

credit in respect of such,
(a) goods; or
(b) capital goods or, having availed of such credit, has reversed

the said credit, to the extent availed of by him.

**CHAPTER XXI**

**MISCELLANEOUS PROVISIONS**

**143. Job work procedure- (1) A registered person (hereafter in this section**
referred to as the “principal”) may, under intimation and subject to such
conditions as may be prescribed, send any inputs or capital goods, without
payment of tax, to a job worker for job work and from there subsequently
send to another job worker and likewise, and shall,––

(a) bring back inputs, after completion of job work or otherwise,
or capital goods, other than moulds and dies, jigs and
fixtures, or tools, within one year and three years,
respectively, of their being sent out, to any of his place of
business, without payment of tax;


-----

(b) supply such inputs, after completion of job work  or

otherwise, or capital goods, other than moulds and dies,
jigs and fixtures, or tools, within one year and three years,
respectively, of their being sent out from the place of
business of a job worker on payment of tax within India, or
with or without payment of tax for export, as the case may
be:

Provided that the principal shall not supply the goods

from the place of business of a job worker in accordance with
the provisions of this clause unless the said principal
declares the place of business of the job worker as his
additional place of business except in a case;

1[Provided further that the period of one year and

three years may, on sufficient cause being shown, be
extended by the Chief Commissioner for a further period
not exceeding one year and two years respectively.]

(i) where the job worker is registered under section
25; or

(ii) where the principal is engaged in the supply of such

goods as may be notified by the Chief Commissioner.

(2) The responsibility for keeping proper accounts for the inputs or

capital goods shall lie with the principal.

(3) Where the inputs sent for job work are not received back by the

principal after completion of job work or otherwise in accordance with the
provisions of clause (a) of sub-section (1) or are not supplied from the place
of business of the job worker in accordance with the provisions of clause (b) of
sub-section (1) within a period of one year of their being sent out, it shall be
deemed that such inputs had been supplied by the principal to the job worker
on the day when the said inputs were sent out.

(4) Where the capital goods, other than moulds and dies, jigs and

fixtures, or tools, sent for job work are not received back by the principal in
accordance with the provisions of clause (a) of sub-section (1) or are not
supplied from the place of business of the job worker in accordance with the
provisions of clause (b) of sub-section (1) within a period of three years of
their being sent out, it shall be deemed that such capital goods had been
supplied by the principal to the job-worker on the day when the said capital
goods were sent out.

(5) Notwithstanding anything contained in sub-sections (1) and (2), any

1
Ins. by Act 23 of 2018, s.28 (w.e.f. 1-2-2019)


-----

waste and scrap generated during the job work may be supplied by the job
worker directly from his place of business on payment of tax, if such job
worker is registered, or by the principal, if the job worker is not registered.

_Explanation:- For the purpose of job work, input_ includes intermediate goods
arising from any treatment or process carried out on the inputs by the
principal or the job worker.

**144.** **Presumption as to documents in certain cases-**

Where any document
(i) is produced by any person under this Act or any other law
for the time being in force; or

(ii) has been seized from the custody or control of any person
under this Act or any other law for the time being in force; or

(iii) has been received from any place outside India in the course

of any proceedings under this Act or any other law for the
time being in force, and such document is tendered by the
prosecution in evidence against him or any other person who
is tried jointly with him, the court shall, 
(a) unless the contrary is proved by such person, presume,
(i) the truth of the contents of such document;

(ii) that the signature and every other part of such

document which purports to be in the handwriting of
any particular person or which the court may
reasonably assume to have been signed by, or to be in
the handwriting of, any particular person, is in that
person’s handwriting, and in the case of a document
executed or attested, that it was executed or attested by
the person by whom it purports to have been so
executed or attested;

(b) admit the document in evidence notwithstanding that it is
not duly stamped, if such document is otherwise admissible
in evidence.

**145. Admissibility of micro films, facsimile copies of documents and**
**computer printouts as documents and as evidence-** (1) Notwithstanding
anything contained in any other law for the time being in force, 

-----

(a) a micro film of a document or the reproduction of the image
or images embodied in such micro film (whether enlarged or
not); or

(b) a facsimile copy of a document; or

(c) a statement contained in a document and included in a
printed material produced by a computer, subject to such
conditions as may be prescribed; or

(d) any information stored electronically in any device or media,
including any hard copies made of such information, shall be
deemed to be a document for the purposes of this Act and
the rules made thereunder and shall be admissible in any
proceedings thereunder, without further proof or production
of the original, as evidence of any contents of the original or
of any fact stated therein of which direct evidence would be
admissible.

(2) In any proceedings under this Act and or the rules made

thereunder, where it is desired to give a statement in evidence by virtue of
this section, a certificate, —

(a) identifying the document Containing the statement and
describing the manner in which it was produced;

(b) giving such particulars of any device involved in the
production of that  document as may be appropriate for
the purpose of showing that the document was produced
by a computer, shall be evidence of any matter stated in the
certificate and for the purposes of this sub-section it
shall be sufficient for a matter to be stated to the best of the
knowledge and belief of the person stating it.

**146.** **Common Portal-**

The Government may, on the recommendations of the Council, notify

the Common Goods and Services Tax Electronic Portal for facilitating
registration, payment of tax, furnishing of returns, computation and
settlement of integrated tax, electronic way bill and for carrying out such
other functions and for such purposes as may be prescribed.

**147.** **Deemed Exports-**

The Government may, on the recommendations of the Council, notify certain
supplies of goods as “deemed exports”, where goods supplied do not leave
India, and payment for such supplies is received either in Indian
rupees or in convertible foreign exchange, if such goods are manufactured
in India.

**148.** **Special Procedure for certain processes-**


-----

The Government may, on the recommendations of the Council, and subject to
such conditions and safeguards as may be prescribed, notify certain
classes of registered persons, and the special procedures to be followed by
such taxable persons including those with regard to registration, furnishing
of return, payment of tax and administration of such persons.

**149.** **Goods and services tax compliance rating-**

(1) Every registered person may be assigned a goods and services tax

compliance rating score by the Government based on his record of compliance
with the provisions of this Act.

(2) the goods and services tax compliance rating score may be

determined on the basis of such parameters as may be prescribed.

(3) The goods and services tax compliance rating score may be updated

at periodic intervals and intimated to the registered person and also placed in
the public domain in such manner as may be prescribed.

**150. Obligation to furnish information return-**

(1) Any person, being,
(a) a taxable person; or
(b)  a local authority or other public body or association; or
(c) any authority of the State Government responsible for the
collection of value added tax or sales tax or State excise duty or
an authority of the Central Government responsible for the
collection of excise duty or customs duty; or

(d) an income tax authority appointed under the provisions of the

Income-tax Act, 1961 (Act No.43 of 1961); or

(e)  a banking company within the meaning of clause (a) of

section 45A of the Reserve Bank of India Act, 1934 (Act No.2 of
1934); or

(f)  a State Electricity Board or an electricity distribution or

transmission licensee under the Electricity Act, 2003, (Act
No.36 of 2003) or any other entity entrusted with such
functions by the Central Government or the State Government;
or

(g) the Registrar or Sub-Registrar appointed under section 6 of the

Registration Act, 1908 (Act No.16 of 1908); or

(h)  a Registrar within the meaning of the Companies Act, 2013

(Act No.18 of 2013); or

(i) the registering authority empowered to register motor vehicles
under the Motor Vehicles Act, 1988 (Act No.59 of 1988); or

(j) the Collector referred to in clause (c) of section 3 of the Right to


-----

Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement Act, 2013 (Act No.30 of 2013);
or

(k) the recognised stock exchange referred to in clause (f) of

section 2 of the Securities Contracts (Regulation) Act, 1956
(Act No.42 of 1956); or

(l) a depository referred to in clause (e) of sub-section (1) of
section 2 of the Depositories Act, 1996 (Act No.22 of 1996); or

(m) an officer of the Reserve Bank of India as constituted under

section 3 of the Reserve Bank of India Act, 1934 (Act No.2 of
1934); or

(n)  the Goods and Services Tax Network, a company registered

under the Companies Act, 2013 (Act No.18 of 2013); or

(o) a person to whom a Unique Identity Number has been granted

under sub-section (9) of section 25; or

(p) any other person as may be specified, on the recommendations

of the Council, by the Government,

who is responsible for maintaining record of registration or

statement of accounts or any periodic return or document
containing details of payment of tax and other details of
transaction of goods or services or both or transactions related
to a bank account or consumption of electricity or transaction
of purchase, sale or exchange of goods or property or right or
interest in a property under any law for the time being in force,
shall furnish an information return of the same in respect of
such periods, within such time, in such form and manner and
to such authority or agency as may be prescribed.

(2) Where the Chief Commissioner, or an officer authorised by him in

this behalf, considers that the information furnished in the information
return is defective, he may intimate the defect to the person who has
furnished such information return and give him an opportunity of rectifying
the defect within a period of thirty days from the date of such intimation or
within such further period which, on an application made in this behalf, the
said authority may allow and if the defect is not rectified within the said
period of thirty days or the further period so allowed, then, notwithstanding
anything contained in any other provisions of this Act, such information
return shall be treated as not furnished and the provisions of this Act shall
apply.

(3) Where a person who is required to furnish information return has


-----

not furnished the same within the time specified in sub-section (1) or subsection (2), the said authority may serve upon him a notice requiring
furnishing of such information return within a period not exceeding ninety
days from the date of service of the notice and such person shall furnish the
information return.

**151.  Power to collect statistics-** (1)The Chief Commissioner may, if he
considers that it is necessary so to do, by notification, direct that
statistics may be collected relating to any matter dealt with, by or in
connection with this Act.

(2) Upon  such  notification being  issued, the Chief Commissioner,

or any person authorised by him in this behalf, may call upon the
concerned persons to furnish such information or returns, in such form and
manner as may be prescribed, relating to any matter in respect of which
statistics is to be collected.

**152.** **Bar on disclosure of information required under section 151-**

(1)No information of any individual return or part thereof with respect

to any matter given for the purposes of section 150 or section 151 shall,
without the previous consent in writing of the concerned person or his
authorised representative, be published in such manner so as to enable
such particulars to be identified as referring to a particular person and no
such information shall be used for the purpose of any proceedings under this
Act.

(2) Except for the purposes of prosecution under this Act, or any other

Act for the time being in force, no person who is not engaged in the
collection of statistics  under  this  Act  or  compilation  or
computerization thereof for the purposes of this Act, shall be permitted to
see or have access to any information or any individual return referred to
in section 151.

(3) Nothing in this section shall apply to the publication of any

information relating to a class of taxable persons or class of transactions, if in
the opinion of the Chief Commissioner, it is desirable in the public interest to
publish such information.

**153.** **Taking assistance from an expert-  Any officer not below the rank**

of Assistant Commissioner may, having regard to the nature and complexity


-----

of the case and the interest of revenue, take assistance of any expert at any

stage of scrutiny, inquiry, investigation or any other proceedings before him.

**154. Power to take samples-** The Chief Commissioner or an officer
authorised by him may take samples of goods from the possession of any
taxable person, where he considers it necessary, and provide a receipt for any
samples so taken.

**155.** **Burden of Proof- Where any person claims that he is eligible for input**
tax credit under this Act, the burden of proving such claim shall lie on such
person.

**156. Persons deemed to be public servants- All persons discharging**
functions under this Act shall be deemed to be public servants within the
meaning of section 21 of the Indian Penal Code. (Act No.45 of 1860).

**157. Protection of action taken under this Act- (1) No suit, prosecution or**
other legal proceedings shall lie against the President, State President,
Members, officers or other employees of the Appellate Tribunal or any
other person authorised by the said Appellate Tribunal for anything which is
in good faith done or intended to be done under this Act or the rules made
thereunder.

(2) No suit, prosecution or other legal proceedings shall  lie  against

any  officer  appointed  or authorised under this Act for anything which is
done or intended to be done in good faith under this Act or the rules made
thereunder.

**158.** **Disclosure of information by a public servant-**

(1) All particulars contained in any statement made, return furnished

or accounts or documents produced in accordance with this Act, or in any
record of evidence given in the course of any proceedings under this Act
(other than proceedings before a criminal court), or in any record of any
proceedings under this Act shall, save as provided in sub-section (3), not be
disclosed.

(2) Notwithstanding anything contained in the Indian Evidence Act,

1872, (Act No1 of 1872) no court shall, save as otherwise provided in subsection (3), require any officer appointed or authorised under this Act to
produce before it or to give evidence before it in respect of particulars referred
to in sub-section (1).

(3)  Nothing contained in this section shall apply to the disclosure of,
(a) any particulars in respect of any statement, return, accounts,

documents, evidence, affidavit or deposition, for the purpose
of any prosecution under the Indian Penal Code, 1860 (Act


-----

No.45 of 1860) or the Prevention of Corruption Act, 1988, (Act
No.49 of 1988) or any other law for the time being in force; or

(b) any particulars to the Central Government or the State

Government or to any person acting in the implementation of
this Act, for the purposes of carrying out the objects of this
Act; or

(c) any particulars when such disclosure is occasioned by the

lawful exercise under this Act of any process for the service of
any notice or recovery of any demand; or

(d) any particulars to a civil court in any suit or proceedings, to

which the Government or any authority under this Act is a
party, which relates to any matter arising out of any
proceedings under this Act or under any other law for the time
being in force authorising any such authority to exercise any
powers thereunder; or

(e) any particulars to any officer appointed for the purpose of audit

of tax receipts or refunds of the tax imposed by this Act; or

(f) any particulars where such particulars are relevant for the

purposes of any inquiry into the conduct of any officer
appointed or authorised under this Act, to any person or
persons appointed as an inquiry officer under any law for the
time being in force; or

(g) any such particulars to an officer of the Central Government or

of any State Government, as may be necessary for the purpose
of enabling that Government to levy or realise any tax or duty;
or

(h) any particulars when such disclosure is occasioned by the

lawful exercise by a public servant or any other statutory
authority, of his or its powers under any law for the time being
in force; or

(i) any particulars relevant to any inquiry into a charge of

misconduct in connection with any proceedings under this Act
against a practising advocate, a tax practitioner, a practising
cost accountant, a practising chartered accountant, a

practising company secretary to the authority empowered to
take disciplinary action against the members practising the
profession of a legal practitioner, a cost accountant, a
chartered accountant or a company secretary, as the case may
be; or

(j) any particulars to any agency appointed for the purposes of

data entry on any automated system or for the purpose of


-----

operating, upgrading or maintaining any automated system
where such agency is contractually bound not to use or
disclose such particulars except for the aforesaid purposes; or

(k) any such particulars to an officer of the Government as may be

necessary for the purposes of any other law for the time being
in force; and

(l) any information relating to any class of taxable persons or class

of transactions for publication, if, in the opinion of the Chief
Commissioner, it is desirable in the public interest, to publish
such information.

**159.** **Publication of information respecting persons in certain cases- (1)**
If the Chief Commissioner, or any other officer authorised by him in this
behalf, is of the opinion that it is necessary or expedient in the public interest
to publish the name of any person and any other particulars relating to
any proceedings or prosecution under this Act in respect of such person, it
may cause to be published such name and particulars in such manner as it
thinks fit.

(2) No publication under this section shall be made in relation to any

penalty imposed under this Act until the time for presenting an appeal to
the Appellate Authority under section 107 has expired without an appeal
having been presented or the appeal, if presented, has been disposed of.

**Explanation:- In the case of firm, company or other association of persons,**
the names of the partners of the firm,  directors,  managing  agents,
secretaries  and treasures or managers of the company, or the members of
the association, as the case may be, may also be published if, in the opinion
of the Chief Commissioner, or any other officer authorised by him in this
behalf, circumstances of the case justify it.

**160.** **Assessment proceedings, etc., not to be invalid on certain**
**grounds- (1) No assessment, re-assessment, adjudication, review,  revision,**
appeal,  rectification,  notice, summons or other proceedings done, accepted,
made, issued, initiated, or purported to have been done, accepted, made,
issued, initiated in pursuance of any of the provisions of this Act shall be
invalid or deemed to be invalid merely by reason of any mistake,  defect
or  omission  therein,  if  such assessment, re-assessment, adjudication,
review, revision, appeal, rectification, notice, summons or other proceedings
are in substance and effect in conformity with or according to the intents,
purposes and requirements of this Act or any existing law.

(2) The  service  of  any  notice,  order  or communication shall

not be called in question, if the notice, order or communication, as the case
may be, has already been acted upon by the person to whom it is issued or


-----

where such service has not been called in question at or in the earlier
proceedings commenced, continued or finalised pursuant to such notice,
order or communication.

**161.** **Rectification of errors apparent on the face ofrecord-**

Without prejudice to the provisions of section 160, and not

withstanding anything contained in any other provisions of this Act, any
authority, who has passed or issued any decision or order or notice or
certificate or any other document, may rectify any error which is apparent on
the face of record in such decision or order or notice or certificate or any other
document, either on its own motion or where such error is brought to its
notice by any officer appointed under this Act or an officer appointed
under the Central Goods and Services Tax Act, 2017 (Act No.12 of 2017)
or by the affected person within a period of three months from the date of
issue of such decision or order or notice or certificate or any other document,
as the case may be:

Provided that no such rectification shall be done after a period of six

months from the date of issue of such decision or order or notice or certificate
or any other document:

Provided further that the said period of six months shall not apply in

such cases where the rectification is purely in the nature of correction of a
clerical or arithmetical error, arising from any accidental slip or omission:

Provided also that where such rectification adversely affects any person,

the principles of natural justice shall be followed by the authority carrying out
such rectification.

**162. Bar on jurisdiction of civil courts-**

Save as provided in sections 117 and 118, no civil court shall have

jurisdiction to deal with or decide any question arising from or relating to
anything done or purported to be done under this Act.

**163. Levy of fee-**

Wherever a copy of any order or document is to be provided to any

person on an application made by him for that purpose, there shall be paid
such fee as may be prescribed.

**164.** **Power of Government to make rules-**

(1) The Government may, on the recommendations of the Council, by

notification, make rules for carrying out the provisions of this Act.

(2) Without prejudice to the generality of the provisions of sub

-----

section (1), the Government may make rules for all or any of the matters
which by this Act are required to be, or may be, prescribed or in respect
of which provisions are to be or may be made by rules.

(3) The power to make rules conferred by this section shall include the

power to give retrospective effect to the rules or any of them from a date not
earlier than the date on which the provisions of this Act come into force.

(4) Any rules made under sub-section (1) or sub-section (2) may

provide that a contravention thereof shall be liable to a penalty not
exceeding ten thousand rupees.

**165.** **Power to make regulations-**

The Government may, by notification, make regulations consistent with

this Act and the rules made thereunder to carry out the provisions of this Act.

**166.** **Laying of rules, regulations and notifications-**

Every rule made by the Government, every regulation made by

the Government and every notification issued by the Government under this
Act, shall be laid, as soon as may be after it is made or issued, before the
State Legislature, while it is in session, for a total period of thirty days which
may be comprised in one session or in two or more successive sessions, and
if, before the expiry of the session immediately following the session or the
successive sessions aforesaid, the State Legislature agrees in making any
modification in the rule or regulation or in the notification, as the case may
be, or the State Legislature agrees that the rule or regulation or the
notification should not be made, the rule or regulation or notification, as the
case may be, shall thereafter have effect only in such modified form or be of
no effect, as the case may be; so, however, that any such modification or
annulment shall be without prejudice to the validity of anything previously
done under that rule or regulation or notification, as the case may be.

**167.** **Delegation of power -**

The Chief Commissioner may, by notification, direct that subject to

such conditions, if any, as may be specified in the notification, any power
exercisable by any authority or officer under this Act may be exercisable also
by another authority or officer as may be specified in such notification.

**168. Power to issue instructions or directions-**

The Chief Commissioner may, if he considers it necessary or

expedient so to do for the purpose of uniformity in the implementation of this
Act, issue such orders, instructions or directions to the State tax officers as it
may deem fit, and thereupon all such officers and all other persons
employed in the implementation of this Act shall observe and follow such
orders, instructions or directions.


-----

**169. Service of notice in certain circumstances-**

(1) Any decision, order, summons, notice or other communication

under this Act or the rules made thereunder shall be served by any one of
the following methods, namely: 
(a) by giving or tendering it directly or by a messenger including a

courier to the addressee or the taxable person or to his manager
or authorised representative or an advocate or a tax practitioner
holding authority to appear in the proceedings on behalf of the
taxable person or to a person regularly employed by him in
connection with the business, or to any adult member of family
residing with the taxable person; or

(b) by registered post or speed post or courier with

acknowledgement due, to the person for whom it is intended or
his authorised representative, if any, at his last known place of
business or residence; or

(c) by sending a communication to his e-mail address provided at

the time of registration or as amended from time to time; or

(d) by making it available on the common portal; or

(e) by publication in a newspaper circulating in the locality in

which the taxable person or the person to whom it is issued is
last known to have resided, carried on business or personally
worked for gain; or

(f) if none of the modes aforesaid is practicable, by affixing it in

some conspicuous place at his last known place of business or
residence and if such mode is not practicable for any reason,
then by affixing a copy thereof on the notice board of the office of
the concerned officer or authority who or which passed such
decision or order or issued such summons or notice.

(2) Every decision, order, summons, notice or any communication shall

be deemed to have been served on the date on which it is tendered or
published or a copy thereof is affixed in the manner provided in sub-section
(1).

(3) When such decision, order, summons, notice or any communication

is sent by registered post or speed post, it shall be deemed to have been
received by the addressee at the expiry of the period normally taken by such
post in transit unless the contrary is proved.

**170. Rounding off of tax etc.,-**

The amount of tax, interest, penalty, fine or any other sum payable,


-----

and the amount of refund or any other sum due, under the provisions of this
Act shall be rounded off to the nearest rupee and, for this purpose, where
such amount contains a part of a rupee consisting of paise, then, if such part
is fifty paise or more, it shall be increased to one rupee and if such part is
less than fifty paise it shall be ignored.

**171.** **Anti-profiteering Measure-**

(1) Any reduction in rate of tax on any supply of goods or services or

the benefit of input tax credit shall be passed on to the recipient by way
of commensurate reduction in prices.

(2) The Central Government may on recommendations of the Council,

by notification, constitute an Authority, or empower an existing Authority
constituted under any law for the time being in force, to examine whether
input tax credits availed by any registered person or the reduction in the tax
rate have actually resulted in a commensurate reduction in the price of
the goods or services or both supplied by him.

(3) The Authority referred to in sub-section (2) shall exercise such

powers and discharge such functions as may be prescribed.

**172. Removal of difficulties-**

(1) If any difficulty arises in giving effect to any provisions of this Act,

the Government may, on the recommendations of the Council, by a general or
a special order published in the Andhra Pradesh Gazette, make such
provisions not inconsistent with the provisions of this Act or the rules or
regulations made thereunder, as may be necessary or expedient for the
purpose of removing the said difficulty:

Provided that no such order shall be made after the expiry of a period

of three years from the date of commencement of this Act.

(2) Every order made under this section shall be laid, as soon as may

be, after it is made, before the State Legislature.

**173.** **Amendment of certain Acts- Save as otherwise provided in this Act,**

on and from the date of commencement of this Act,
The following provisions of law shall be omitted.

(i) Section 14 of the Andhra Pradesh Municipal Corporations

Act, 1994, (Act No.25 of 1994) in so far as it refers to clause
(f) of sub-section (1) of section 197 of the Municipal
Corporations Act, 1955; (Act No.2 of 1956)

(ii) Section 114 of the Andhra Pradesh Municipalities Act, 1965


-----

(Act No.6 of 1965);

(iii) Section 63 of the Andhra Pradesh Panchayat Raj Act, 1994

(Act No.13 of 1994);

**174. Repeal and saving- (1) Save as otherwise provided in this Act, on and**
from the date of commencement of this Act.

(i) the Andhra Pradesh Value Added Tax Act, 2005, (Andhra

Pradesh Act No.5 of 2005)except in respect of goods included
in the Entry 54 of the State List of Seventh Schedule to the
Constitution,

(ii) the Andhra Pradesh Entertainments Tax Act, 1939 (Andhra

Pradesh Act No.10 of 1939).

(iii) the Andhra Pradesh Tax on Entry of Motor Vehicles into

Local Areas Act, 1996 (Andhra Pradesh Act No.26 of 1996);

(iv) the Andhra Pradesh Tax on Entry of Goods into Local Areas

Act, 2001 (Andhra Pradesh Act No.39 of 2001).

(v) the Andhra Pradesh Tax on Luxuries Act, 1987 (Andhra

Pradesh Act No.24 of 1987);

(vi) the Andhra Pradesh (Telangana Area) Horse Racing and

Betting Tax Regulations, 1358 Fasli (Adaption and

Amendment) Act, 2015;

(vii) the Andhra Pradesh Rural Development Act, 1996 (Andhra
Pradesh (Act No.11 of 1996) (hereafter referred to as the
repealed Acts) are hereby repealed.

(2) The repeal of the said Acts to the amendment of the Acts specified

in section 173 (hereafter referred to as “such amendment” or “amended Act”,
as the case may be) to the extent mentioned in sub-section (1) or section 173
shall not,
(a) revive anything not in force or existing at the time of such

amendment or repeal; or

(b) affect the previous operation of the amended Acts or

repealed Acts and orders or anything duly done or suffered
thereunder; or

(c) affect any right, privilege, obligation, or liability acquired,

accrued or incurred under the amended the Acts or
repealed Acts or orders under such repealed or amended
Acts:


-----

Provided that any tax exemption granted as an incentive against

investment through a notification shall not continue as
privilege if the said notification is rescinded on or after the
appointed day; or

(d) affect any tax, surcharge, penalty, fine, interest as are due

or may become due or any forfeiture or punishment
incurred or inflicted in respect of any offence or violation
committed against the provisions of the amended Acts or
repealed Acts; or

(e) affect any investigation, inquiry, verification (included

scrutiny and audit), assessment proceedings, adjudication
and any other legal proceedings or recovery of arrears or
remedy in respect of any such tax, surcharge, penalty, fine,
interest, right, privilege, obligation, liability, forfeiture or
punishment, as aforesaid, and any such investigation,
inquiry, verification (included scrutiny and audit),

assessment proceedings, adjudication and other legal
proceedings or recovery of arrears or remedy may be
instituted, continued or enforced, and any such tax,
surcharge, penalty, fine, interest, forfeiture or punishment
may be levied or imposed as if these Acts had not been so
amended or repealed; or

(f) affect any proceedings including that relating to an appeal,
revision, review or reference, instituted before, on or after
the appointed day under the said amended Acts or repealed
Acts and such proceedings shall be continued under the
said amended Acts or repealed Acts as if this Act had not
come into force and the said Acts had not been amended or
repealed.

(3) The mention of the particular matters referred to in section 173 and

sub-section (1) shall not be held to prejudice or affect the general application
of sections 8, 8A, 9 and 18 of the Andhra Pradesh General Clauses Act, 1891
(Andhra Pradesh Act No.1 of 1891)with regard to the effect of repeal.

**SCHEDULE –I**

**[See Section 7]**

**ACTIVITIES TO BE TREATED AS SUPPLY EVEN IF MADE WITHOUT**

**CONSIDERATION**


-----

**1.** Permanent transfer or disposal of business assets where input tax

credit has been availed on such assets.

**2.** Supply of goods or services or both between related persons or between

distinct persons as specified in section 25, when made in the course or
furtherance of business:

Provided that gifts not exceeding fifty thousand rupees in value in a

financial year by an employer to an employee shall not be treated as supply of
goods or services or both.

**3.** Supply of goods:
(a) by a principal to his agent where the agent undertakes to
supply such goods on behalf of the principal; or

(b) by an agent to his principal where the agent undertakes to
receive such goods on behalf of the principal.

**4.** Import of services by a [1]* * * * * person from a related person or from

any of his other establishments outside India, in the course or furtherance of
business.

**SCHEDULE II**

**[See Section 7]**

**ACTIVITIES [2][OR TRANSACTIONS] TO BE TREATED AS SUPPLY OF**

**GOODS OR**

**SUPPLY OF SERVICES**

**1.** **Transfer:-**

(a) any transfer of the title in goods is a supply of goods;

(b) any transfer of right in goods or of undivided share in goods
without the transfer of title thereof, is a supply of services;

(c) any transfer of title in goods under an agreement which
stipulates that property in goods shall pass at a future date
upon payment of full consideration as agreed, is a supply of

1
The word “taxable” omitted by Act 23 of 2018, s.29 (w.e.f. 1-2-2019)

2
The words “OR TRANSACTIONS” inserted, shall always be deemed to have been inserted by Act 23 of 2018, s.30, (w.e.f. 1-7-2017)


-----

goods.

**2.** **Land and Building:-**

(a) any lease, tenancy, easement, licence to occupy land is a
supply of services;

(b) any lease or letting out of the building including a commercial,
industrial or residential complex for business or commerce,
either wholly or partly, is a supply of services.

**3.** **Treatment or process:-**

Any treatment or process which is applied to another person’s goods is

a supply of services.

**4.** **Transfer of business assets**

(a) where goods forming part of the assets of a business are
transferred or disposed of by or under the directions of the
person carrying on the business so as no longer to form part of
those assets, whether or not for a consideration, such transfer
or disposal is a supply of goods by the person;

(b) where, by or under the direction of a person carrying on a
business, goods held or used for the purposes of the business
are put to any private use or are used, or made available to any
person for use, for any purpose other than a purpose of the
business, whether or not for a consideration, the usage or
making available of such goods is a supply of services;

(c) where any person ceases to be a taxable person, any goods
forming part of the assets of any business carried on by him
shall be deemed to be supplied by him in the course or
furtherance of his business immediately before he ceases to be
a taxable person, unless—

(i) the business is transferred as a going concern to
another person; or

(ii) the business is carried on by a personal representative
who is deemed to be a taxable person.


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**5.** **Supply of services:-**

The following shall be treated as supply of service, namely:
(a) renting of immovable property;

(b) construction of a complex, building, civil structure or a part
thereof, including a complex or building intended for sale to a
buyer, wholly or partly, except where the entire consideration
has been received after issuance of completion certificate,
where required, by the competent authority or after its first
occupation, whichever is earlier.

**Explanation:-** For the purposes of this clause––

(1) the expression "competent authority" means the Government or any

authority authorised to issue completion certificate under any law for the time
being in force and in case of non-requirement of such certificate from such
authority, from any of the following, namely:–

(i) an architect registered with the Council of Architecture
constituted under the Architects Act, 1972 (Act No.20 of
1972); or

(ii) a chartered engineer registered with the Institution of
Engineers (India); or

(iii) a licensed surveyor of the respective local body of the city or
town or village or development or planning authority;

(2) the expression "construction" includes additions, alterations,

replacements or remodeling of any existing civil structure;

(c) temporary transfer or permitting the use or enjoyment of any
intellectual property right;

(d) development, design, programming, customisation,

adaptation, upgradation, enhancement, implementation of
information technology software;

(e) agreeing to the obligation to refrain from an act, or to
tolerate an act or a situation, or to do an act; and

(f) transfer of the right to use any goods for any purpose
(whether or not for a specified period) for cash, deferred
payment or other valuable consideration.


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**6.** **Composite supply:-**

The following composite supplies shall be treated as a supply of

services, namely:—

(a) works contract as defined in clause (119) of section 2; and

(b) supply, by way of or as part of any service or in any other
manner whatsoever, of goods, being food or any other article
for human consumption or any drink (other than alcoholic
liquor for human consumption), where such supply or
service is for cash, deferred payment or other valuable
consideration.

**7.** **Supply of Goods:-**

The following shall be treated as supply of goods, namely,
Supply of goods by any unincorporated association or body of persons

to a member thereof for cash, deferred payment or other valuable
consideration.

**SCHEDULE III**

**[See Section 7]**

**ACTIVITIES OR TRANSACTIONS WHICH SHALL BE TREATED NEITHER**

**AS A SUPPLY OF GOODS NOR A SUPPLY OF SERVICES**

**1. Services by an employee to the employer in the course of or in relation to**

his employment.

**2.** Services by any court or Tribunal established under any law for the

time being in force.

**3.** (a) the functions performed by the Members of Parliament, Members of

State Legislature, Members of Panchayats, Members of Municipalities and
Members of other local authorities;

(b) the duties performed by any person who holds any post in

pursuance of the provisions of the Constitution of India in that
capacity; or

(c) the duties performed by any person as a Chairperson or a Member

or a Director in a body established by the Central Government or a
State Government or local authority and who is not deemed as an
employee before the commencement of this clause.


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**4.** Services of funeral, burial, crematorium or mortuary including

transportation of the deceased.

**5.** Sale of land and, subject to clause (b) of paragraph 5 of Schedule II,

sale of building.

**6.** Actionable claims, other than lottery, betting and gambling.

**1[7. Supply of goods from a place outside India to another place outside India**
without such goods entering into India.

**8.** (a) Supply of warehoused goods to any person before clearance for

home consumption;
(b) Supply of goods by the consignee to any other person, by

endorsement of documents of title to the goods, after the goods have been
dispatched from the port of origin located outside India but before clearance
for home consumption.]

**2[Explanation 1]:-** For the purposes of paragraph 2 the term “court”
includes District Court, High Court and Supreme Court.

**[3][Explanation 2.–– For the purposes of paragraph 8, the expression**
“warehoused goods” shall have the same meaning as assigned to it in the
Customs Act, 1962.]

1
Ins. by Act 23 of 2018, s.31 (w.e.f. 1-2-2019)

2
Subs. by Act 23 of 2018, s.31, for the word “Explanation ” (w.e.f. 1-2-2019)
3
Ins. by Act 23 of 2018, s.31 (w.e.f. 1-2-2019)


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